For Directional traders

Rob on Business · Aug 22, 2005

Yeah, good advice - sounds like something I might say myself, except on this end, I'm wondering how bad the withdrawal symptoms are gonna get before I end the "fast" and get back in?! Points well appreciated, though.

Noticed how RIMM shot up again today? I wonder if eagerbeaver is enjoying it?

palawan · Aug 23, 2005

mini-update 8/23/05:

NTES Dec 75 calls - (qty=5) risk-capital is $2700

reasoning: "swallowed" the jim rogers' interview article on asia inc sept 05 issue regarding the china growth story...

Peace.

Chagi · Aug 24, 2005

Good news (for me) - if all goes well, it looks like I should have a much more in depth (if primarily academic) understanding of options by the end of the Fall semester.

I'm doing a course on risk management this Fall, and a full half of the class covers options, here is a sampling of topics:

- Options Markets
- Stock Options
- Trading Strategies with Options
- Binomial Trees
- The Blacks-Scholes Model
- Stock Index and Currency Options
- Futures Options
- Hedging with Options

I actually dropped this class the first time I attempted it, realized a bit too late what I was getting myself into when plugging through an assignment that was covering futures, swap valuations, etc. That said, with my new found interest in options, I'm really looking forward to this class. Also taking another class that covers management of fixed income portfolios, but I expect that one will be a bit of a snoozer...

palawan · Aug 24, 2005

Quote from Chagi:

Good news (for me) - if all goes well, it looks like I should have a much more in depth (if primarily academic) understanding of options by the end of the Fall semester.

I'm doing a course on risk management this Fall, and a full half of the class covers options, here is a sampling of topics:

- Options Markets
- Stock Options
- Trading Strategies with Options
- Binomial Trees
- The Blacks-Scholes Model
- Stock Index and Currency Options
- Futures Options
- Hedging with Options

I actually dropped this class the first time I attempted it, realized a bit too late what I was getting myself into when plugging through an assignment that was covering futures, swap valuations, etc. That said, with my new found interest in options, I'm really looking forward to this class. Also taking another class that covers management of fixed income portfolios, but I expect that one will be a bit of a snoozer...

Sounds like an interesting and exciting class! Have fun...

Rob on Business · Aug 24, 2005

That is a desireable plan, Palawan, to hedge with opposite pos'ns on another company, same as what Optionpro007 was outlining in his previous discussion with Moralhazard. I found JNJ also is a downer for puts right now, as is PTR. As soon as I accumulate (almost vanished from my vocabulary) enough from my ECA plays, I'll adopt same.

My ECA-TC (TSX) plans are working well - I think I've got more than 75% of the stock movement over the last 4 mos. figured out so that I know what to do on any given day, at day's open and close. But, time will have to tell how much I'm right.

ECA-TC (TSX) SEP 54calls x5, in @$1.69 Aug.17, dropped to $0.70, now @$1.00 x $1.05

palawan · Aug 24, 2005

Quote from Rob on Business:

That is a desireable plan, Palawan, to hedge with opposite pos'ns on another company, same as what Optionpro007 was outlining in his previous discussion with Moralhazard. I found JNJ also is a downer for puts right now, as is PTR. As soon as I accumulate (almost vanished from my vocabulary) enough from my ECA plays, I'll adopt same.

My ECA-TC (TSX) plans are working well - I think I've got more than 75% of the stock movement over the last 4 mos. figured out so that I know what to do on any given day, at day's open and close. But, time will have to tell how much I'm right.

ECA-TC (TSX) SEP 54calls x5, in @$1.69 Aug.17, dropped to $0.70, now @$1.00 x $1.05

Thanks, Rob. Congrats on your ECA! it went up quite a bit, today. hope it continues going up. oil is hitting new highs and ECA is gonna benefit from that, i think. I wish you the best. i know you meant sept 45 calls

i'm actually too heavily-positioned on the "long" side of the market. i got 3 call-positions and only 1 put-position. i'm thinking hard of closing at least 1. maybe i should have closed the DWA position, but it's already down so much, so it's not really gonna reduce my "long" exposure enough.

i may have to reconsider that NTES call-position.

yes, i agree that having call and put positions (not on the same company) will provide some peace of mind, especially on days like today.

Good luck to you, Rob.

Choad · Aug 24, 2005

Quote from Chagi:

Good news (for me) - if all goes well, it looks like I should have a much more in depth (if primarily academic) understanding of options by the end of the Fall semester.

I'm doing a course on risk management this Fall, and a full half of the class covers options, here is a sampling of topics:

- Options Markets
- Stock Options
- Trading Strategies with Options
- Binomial Trees
- The Blacks-Scholes Model
- Stock Index and Currency Options
- Futures Options
- Hedging with Options

Yer lucky. All I had to look forward to was nut-busters like Thermo, Statics/Dynamics, and Electromagnetic Fields and Waves (thank yooo, JC Maxwell...).

A couple "basket weaving" electives did have some hot babes tho!

Chagi · Aug 24, 2005

Quote from palawan:

Thanks, Rob. Congrats on your ECA! it went up quite a bit, today. hope it continues going up. oil is hitting new highs and ECA is gonna benefit from that, i think. I wish you the best. i know you meant sept 45 calls

Sorry, not trying to nitpick, but it's worth mentioning that Encana is a natural gas play, not an oil stock.

Rob on Business · Aug 24, 2005

The Sept. calls I'm in are indeed at a $54 strke on the Canadian version of Encana, trading on the TSX - the Toronto Stock Exchange, and that stock is at $53, whereas the American counterpart traded at about $44.50 today. I'm trading the TSX because I can daytrade it if I want, yet not so with US stocks til I have $25k in my acc't to comply with SEC rules, according to IB. I closed out my calls at day's close @$1.25 in anticipation of a significantly lower open tomorrow (because today's close was a bit higher than the average close above the trend line for this rally and characteristically, means next day opening lower, allowing me to re-enter at a low price. If it happens to open high, I can ride puts til it resumes the trend intraday, if it does at all. Still experimenting...)

Rob on Business · Aug 24, 2005

Good to hear from you, Chagi! I enclose an exerpt from Yahoo Finance on Encana that looks like it does deal some in oil...

EnCana Corporation engages in the exploration, production, and marketing of natural gas, crude oil, and natural gas liquids (NGL) in Canada, the U.S., Ecuador, and the United Kingdom. The company operates in two divisions, Upstream, and Midstream and Marketing. The Upstream division manages the companyâs exploration, development, and production of natural gas, NGL and crude oil, and other related activities. The Midstream and Marketing division engages in natural gas storage, NGL processing, and power generation operations, as well as the sale and delivery of produced product, and the purchase of third party product. EnCana had net proved reserves of approximately 10.5 trillion cubic feet of natural gas and 501 million barrels of crude oil and NGLs, as of December 31, 2004. EnCana Corporation was formed through the merger of Alberta Energy Company, Ltd. and PanCanadian Energy Corporation in 2002. EnCana is headquartered in Calgary, Canada.

I hope your courses are enthralling - I remember too well falling asleep in many of my college courses!