best options strategies for advanced beginners

[shMark]

Good thing I don't have a farm.

It certainly is. lol

 

[ironchef]

Thanks. I think so. I am not going to bet the farm on options, so it will be a nice hobby. Hopefully one that is profitable.

Yes, in that case don't bet the farm.

There is an old saying: hungry dog hunts best and you are not hungry.

 

[Windlesham1]

ONLY trade strategies on the indexes, NEVER sell naked, you'll be lucky to make 3% p.a.

 

[taowave]

If you are a "decent" derivatives trader/market maker,options most certainly exist in a vacum.

And if you are a decent directional trader,Im not so sure why a newbie would want to trade options (other than leverage/punting/charitable contribution)

Whenever this question comes up I always ask the person, are you also an advanced beginner in analyzing stocks?

Optiosn are derivatives, they do not exist in a vaccuum. If you are not good at all at analyzing stocks, price charts or making good analytical directional bets on stocks (lets not get into vol trades with beginners) then there are no easy step right into beginner option strategies...because you do not know what you are doing with the underlying even.

Covered calls are only simple to explain. But for a newbie stock investor, they are putting lipstick on a pig. I am never a fan of one strategy 100% of the time with options. You have to adjust to the market, the underlying and later on in your journey, vols. Selling calls against your stock position as a newbie is just cutting off your upside and folling you into thinking you have some cushion.

Advanced beginner option strategies are almost all of them when used properly, but none of them if you do not even know how to analyze the market or specific stocks, IMHO.

 

[Zwaen]

If you are a "decent" derivatives trader/market maker,options most certainly exist in a vacum.

And if you are a decent directional trader,Im not so sure why a newbie would want to trade options (other than leverage/punting/charitable contribution)

Suppose you are a directional trader who wants to be longer term invested, in my view one can use the longer expiration and convert the postion somewhat when you want to 'take tempory profits', or expect slower momentum* after a relatively large move. Or use t/g for creating spreads/calenders. Do you disagree with this?(really curious)


* ofcourse the assumption one can anyhow predict this beyond random, which can be a futile attempt

 

[taowave]

Does T/G stand for Theta / Gamma??

Suppose you are a directional trader who wants to be longer term invested, in my view one can use the longer expiration and convert the postion somewhat when you want to 'take tempory profits', or expect slower momentum* after a relatively large move. Or use t/g for creating spreads/calenders. Do you disagree with this?(really curious)


* ofcourse the assumption one can anyhow predict this beyond random, which can be a futile attempt

 

[El OchoCinco]

If you are a "decent" derivatives trader/market maker,options most certainly exist in a vacum.

And if you are a decent directional trader,Im not so sure why a newbie would want to trade options (other than leverage/punting/charitable contribution)

Question was about a beginner...why are you bringing up market making? You have to read comments in context...

Also I said in analyzing stocks, not in being a stock directional trader..... you got to read a little

 

[taowave]

Its beyond your scope and I read too much..

Question was about a beginner...why are you bringing up market making? You have to read comments in context...

Also I said in analyzing stocks, not in being a stock directional trader..... you got to read a little

 

[newwurldmn]

Its beyond your scope and I read too much..

Question was about a beginner...why are you bringing up market making? You have to read comments in context...

Also I said in analyzing stocks, not in being a stock directional trader..... you got to read a little

I know both of you. You both are good guys and both have quite a bit of experience in this field.

 

[taowave]

Who are you and what have you done with NWD?

I know both of you. You both are good guys and both have quite a bit of experience in this field.