Anybody trading LEAP options?

[options4me]

Quote from drcha:

Do you have access to an option calculator? Put some LEAPS in and change the implied volatility. You will see how extremely sensitive they are to this factor. You will want to get this to work in your favor Generally, one wants to buy them when IV is low/rising and sell them when it is high/falling. These are not trading instruments; the bid-ask spread is quite high on all but the largest and most liquid underlying issues/indexes. So they are most suitable for a trade that you want to be in for weeks, months, or years.

Mary

The LEAP can be used as a surrogate instead of buying the actual stock. You can get a LEAP for about 30% of what the actual stock purchase would have cost you. With the B/A spread so high it is not a very good instrument for trading , as stated above.
But if you want to use them as an income generator buy one a couple strikes ITM, then sell a current month call, one or two strikes OTM. I would only do this when the stock that I buy the LEAP for is at a Yearly low or at a major suport level. Did this a couple times and worked out.

 

[dagnyt]

Quote from options4me:

The LEAP can be used as a surrogate instead of buying the actual stock.

PLEASE. PLEASE.

The singular form of the term LEAPS is LEAPS.

It it an acronym and that acronym is always 5-letter long.

Long Term Equity AnticiPation Series

Mark

 

[spindr0]

Those MM's are idiots. I am 1 penny away from their ask, take it or leave it. the other guys are offering a penny less. I I refuse to budge. Better that penny today because tomorrow I will bid a penny lower.

LOL. I would never waste my time on an open position for a penny.
But then again, it's your time

 

[spindr0]

PLEASE. PLEASE. The singular form of the term LEAPS is LEAPS. It it an acronym and that acronym is always 5-letter long.

Long Term Equity AnticiPation Series

Technically, for most of these peeps it is a LEAP (of faith) into a LEAPS option.

 

[KINGOFSHORTS]

Quote from zdreg:

are you in the insurance business? how do u hedge your risks?

Yes I sell insurance to scared investors, just doing my civic duty.

I hedge by keeping a diversified portfolio of puts or calls (or both), and I am very careful about risk management and I carefully calculate the values of all contracts to squeeze out the most buck and give myself the most room to maneuver. I also have a large cash warchest, I do not use margin.


Anyhow I was able to get my orders filled for one penny less it took about two hours to fill, I am real stingy and will try to squeeze that last penny out of the deal

The last few trades ended up 4 cents higher after I bought to close.


Anyhow options writing, think of it more from an actuary's perspective. More like selling auto insurance ie: GEICO etc..

 

[KINGOFSHORTS]

Quote from spindr0:

Technically, for most of these peeps it is a LEAP (of faith) into a LEAPS option.

Or a LEAP into profits with LEAPS

 

[4444CJones4444]

Quote from dagnyt:

PLEASE. PLEASE.

The singular form of the term LEAPS is LEAPS.

It it an acronym and that acronym is always 5-letter long.

Long Term Equity AnticiPation Series

Mark

I notice things like that too. For instance:

Try FedEx Express (try Federal Express Express?)

Order a PCB board (Order a Printed Circuit Board board)

I need your vehicle's VIN number. (I need your vehicle's Vehicle Identification Number number)

 

[Euler]

Quote from dagnyt:

PLEASE. PLEASE.

The singular form of the term LEAPS is LEAPS.

It it an acronym and that acronym is always 5-letter long.

Long Term Equity AnticiPation Series

Mark

You are right, of course, but why care so much? The very need for the distinction between LEAPS and non-LEAPS options is due to the almost comical brokenness of the present symbology. With any luck (or maybe A LOT of luck ), they will have it fixed within a year or two.

http://www.theocc.com/initiatives/symbology/default.jsp

 

[KINGOFSHORTS]

Quote from Euler:

You are right, of course, but why care so much? The very need for the distinction between LEAPS and non-LEAPS options is due to the almost comical brokenness of the present symbology. With any luck (or maybe A LOT of luck ), they will have it fixed within a year or two.

http://www.theocc.com/initiatives/symbology/default.jsp

I am already used to the way things are.

We can change all our keyboards to dvorak layout as well.

 

[zdreg]

Quote from KINGOFSHORTS:

Yes I sell insurance to scared investors, just doing my civic duty.

I hedge by keeping a diversified portfolio of puts or calls (or both), and I am very careful about risk management and I carefully calculate the values of all contracts to squeeze out the most buck and give myself the most room to maneuver. I also have a large cash warchest, I do not use margin.


Anyhow I was able to get my orders filled for one penny less it took about two hours to fill, I am real stingy and will try to squeeze that last penny out of the deal

The last few trades ended up 4 cents higher after I bought to close.


Anyhow options writing, think of it more from an actuary's perspective. More like selling auto insurance ie: GEICO etc..

I do think of it from an "actuary perspective " but still wonder how you are capable of evaluating risk besides diversifying your portfolio.