Conservative Options Trades
- Thread starter danshirley
- Start date
15% over a two month period. 15% x 6 = 90% for 1 year. The options expire October 2012.
Still a lot more than the 15% you came up with.
<<< What makes you so angry??
It's very inappropriate and very unattractive >>>
What I think is "inappropriate" is to label a thread "conservative option trades", when the trades are not conservative.
They are dart throws of stocks whose only investment criteria he uses is, that they have already had fantastic run ups.
<<< I think the point that you are missing is that Dan is NOT BUYING THE STOCK... he is merely putting on a DIM credit spread for income. If he were buying the stock your criticism would have merit >>>
I think you may be missing the point. Because the point is, that he can NOT buy the stocks.
In a previous discussion with him he stated that his strategy is to use 100% of his cash for spreads, with no cash cushion. Because as he stated, his spreads are all cash secured. No margin is used.
Hence the reason a $15 (5 point gap) spread and a $50 (5 point gap) spread all have the same risk profile to him, since he can't buy any of them.
Hence the reason he uses so many high priced strikes for his spreads, since he will NEVER and can NEVER even consider buying any stocks.
Novice investors who may consider following his example, because of his misleading label of "conservative",.... are therefore enouraged to also use high priced strikes, being unaware they too may be unable to consider buying them. The result..... massive or devastating loses to their accounts if the stocks drop.
<<< He relies on the low probability of the stock violating the upper bound of the spread. Thus his calculation of Probability and expectation to support the trading thesis. >>>
Those calculations that are for periods of 5 - 7 months out,... that go though 2 earnings cycles,... that are for stocks trading no where near any kind of tech support,... in a market that has a history of violent corrections,... are not only silly, they are also useless and meaningless.
I don't like the idea that novice investors may read under his misleading thread called CONSERVATIVE OPTION TRADES, that such lengthy contracts have a 94 - 97% probability and expectation of being successful. That is a HOPE. Not a calculation.
All the while, while never mentioning any risk of using high priced strikes, and excessive leverage for those spreads.
If he changes the name of his thread, I'll stop mocking him.
Frankly, I'm disappointed that you are not more upset at his misleading labeling of his trades as conservative, using excessive leverage, with ridiculous probability expectations, the use of high strikes he can never buy, and so on.....
Perhaps now you are? As he is encouraging novice investors to get in over their heads.
It's very inappropriate and very unattractive >>>
What I think is "inappropriate" is to label a thread "conservative option trades", when the trades are not conservative.
They are dart throws of stocks whose only investment criteria he uses is, that they have already had fantastic run ups.
<<< I think the point that you are missing is that Dan is NOT BUYING THE STOCK... he is merely putting on a DIM credit spread for income. If he were buying the stock your criticism would have merit >>>
I think you may be missing the point. Because the point is, that he can NOT buy the stocks.
In a previous discussion with him he stated that his strategy is to use 100% of his cash for spreads, with no cash cushion. Because as he stated, his spreads are all cash secured. No margin is used.
Hence the reason a $15 (5 point gap) spread and a $50 (5 point gap) spread all have the same risk profile to him, since he can't buy any of them.
Hence the reason he uses so many high priced strikes for his spreads, since he will NEVER and can NEVER even consider buying any stocks.
Novice investors who may consider following his example, because of his misleading label of "conservative",.... are therefore enouraged to also use high priced strikes, being unaware they too may be unable to consider buying them. The result..... massive or devastating loses to their accounts if the stocks drop.
<<< He relies on the low probability of the stock violating the upper bound of the spread. Thus his calculation of Probability and expectation to support the trading thesis. >>>
Those calculations that are for periods of 5 - 7 months out,... that go though 2 earnings cycles,... that are for stocks trading no where near any kind of tech support,... in a market that has a history of violent corrections,... are not only silly, they are also useless and meaningless.
I don't like the idea that novice investors may read under his misleading thread called CONSERVATIVE OPTION TRADES, that such lengthy contracts have a 94 - 97% probability and expectation of being successful. That is a HOPE. Not a calculation.
All the while, while never mentioning any risk of using high priced strikes, and excessive leverage for those spreads.
If he changes the name of his thread, I'll stop mocking him.
Frankly, I'm disappointed that you are not more upset at his misleading labeling of his trades as conservative, using excessive leverage, with ridiculous probability expectations, the use of high strikes he can never buy, and so on.....
Perhaps now you are? As he is encouraging novice investors to get in over their heads.
This thread does have a high rating (22 votes, 3.73 stars out of 5) so danshirleys methods can't be all that bad. I think he is winning an audience.
I can get 5 stars put on my thread in the next day or two if i want.Quote from diaoptions:
This thread does have a high rating (22 votes, 3.73 stars out of 5) so danshirleys methods can't be all that bad.
Anybody can.
I just have to call several people and tell them to give it a 5 star rating.
Quote from diaoptions:
This thread does have a high rating (22 votes, 3.73 stars out of 5) so danshirleys methods can't be all that bad. I think he is winning an audience.
Just another quick thought.
This is a guy who does not want to discuss his trades with anybody, and who says he has literally everyone on ignore.
This is a guy who on day one, said he is not posting these trades to discuss with anybody.
Do you seriously think any serious reader/investor is giving his thread all those 5 star ratings???
He is having friends and business associates do that for him. Perhaps they like looking at pictures of big buildings.
Who do you think he is posting all those real and theoretical "conservative" trades for,... which he refuses to discuss with 99% of the posters here.
Believe it or not, he is refering to questions and statements posted to him from more than a dozen individuals. I'm merely the last one.Quote from NOEXPERT:
I wonder what "angry, desperate narcissist" he is talking about??
Now i have a question for you.
Do you seriously believe a new reader/investor that arrives here seeking advice, suggestions and ideas, is going to review 50 pages of old trading postings and warnings over the past year, looking for an idea for a good CONSERVATIVE OPTION TRADE?
Or do you think they will more likely jump to the last few or several days, looking for a good "current conservative" suggestion?
Perhaps one with a 97% expectancy of being a profitable trade?
Again, I have no problem with him posting his trades.... real or theoretical. I post my trades as well.
In fact, I've told him on other threads, that I actually respect him for doing so. Other posters (cowards), only tell us in hindsite what they did days or weeks ago. He is honest about his timing.
My only issue with his trades is, that he labels them all as "conservative" and that he states they have a 97% chance of success.
That is misleading to new readers/investors who pop in here all the time, and are thus unaware of his warnings to ignore his trades. They aren't even aware that they are being ignored.
Thus if he wants to use a thread label called CONSERVATIVE OPTION TRADES, that are NOT ment to be shared or discussed with the public, then that thread belongs in the JOURNAL section of ET.
Not here, where some may misinterpret what they are reading.
He doesn't even differentiate between trades that are actual and merely hypothetical.
Thus they belong in the journal section.
Afterall, he is only posting them for his personal journal use.
NOEXPERT, "Have you ever sought anger management therapy???
Here try this:"
http://www.youtube.com/watch?v=XFX8...feature=related