How long $3000 will last option trading

I determine to have +theta and +vega and try to limit my Delta not more than either +100 or -100. If my Delta is too high, I'll hedge it by openning new credit spread or use other means such as short/long stocks.

For Theta, I want to maintain Theta more than 2, whenever it drops lower than that, I know that I'm not earning much premium. Then, I will open more positions or roll my spreads to maintain that level.

I look at my Theta as how much I earn from time decay in one day too.

As for Gamma, I don't know the level I should be concern yet. I need to have more experience than this. I guess I should be alarmed when it reach 80. Since I elect to be +theta, I have to accept the -gamma.

As a premium seller (not all the time), I tried to have +vega as hedge. Most of my +vega came from diag or calendar.

I'm still learning to find the right number of greeks for me. I suspect that from my capital, I could tolerate higher delta risk.

Overall, I try to earn premium, have delta risk I can tolerate and use total greeks to adjust my portfolio into my comfortable range.

Quote from cnms2:

Delta 49 Gamma -20.36, Theta 6.87, Vega 15.5

How did those greeks influenced your decision to open this position? Or how do you plan to use them?
More...
 
Many guys said if you can survive the first year, then you may become a successful trader. Do you think you can stay in the market? It seems you can!:D
 
Quote from hermit_trader:

Many guys said if you can survive the first year, then you may become a successful trader. Do you think you can stay in the market? It seems you can!:D
More...

All I can say is that I try to avoid doing stupid things. I can't say for sure about my longetivity since it's been about 4-5 months only. Thanks for your support though.
 
SOLD -1 VERTICAL VLO 100 JAN 06 50/47.5 PUT @.50 ISE, VLO MARK 51.58

Reason: Pyramidding. I had one opened for $0.60.

On VLO, now I have 2 50/47.5 credit put spread and 2 47.5/45 credit put spread.

Total Delta on VLO is about 48.

I looked at this chart

http://host.businessweek.com/businessweek/Corporate_Snapshot.html?Symbol=.OIL&Timespan=130

The capital flow into oil industry group seems to decline for past 4 weeks so I should not open any new position in this industry group for now.
 
BOT +1 STJ APR 06 50 CALL @4.00 CBOE, STJ MARK 50.80

I'm long premium on this one based on my bullish view on this stock. I'll sell call against it later.
 
Check this. It's very true.
  • 38-Steps To Be A Successful Trader by Anonymous

    1. We accumulate information--buying books, going to seminars and researching.
    2. We begin to trade with our 'new' knowledge.
    3. We consistently 'donate' and then realize we may need more knowledge or information.
    4. We accumulate more information.
    5. We switch the commodities we are currently following.
    6. We go back into the market and trade with our 'updated' knowledge.
    7. We get 'beat up' again and begin to lose some of our confidence. Fear starts setting in.
    8. We start to listen to 'outside news' & other traders.
    9. We go back into the market and continue to donate.
    10. We switch commodities again.
    11. We search for more information.
    12. We go back into the market and start to see a little progress.
    13. We get 'overconfident' & market humbles us.
    14. We start to understand that trading successfully is going to take more time and more knowledge then we anticipated.

    Most People Will Give up at this Point as They Realize Work Is Involved.

    15. We get serious and start concentrating on learning a 'real' methodology.
    16. We trade our methodology with some success, but realize that something is missing.
    17. We begin to understand the need for having rules to apply our methodology.
    18. We take a sabbatical from trading to develop and research our trading rules.
    19. We start trading again, this time with rules and find some success, but overall we still hesitate when it comes time to execute.
    20. We add, subtract and modify rules as we see a need to be more proficient with our rules.
    21. We feel we are very close to crossing that threshold of successful trading.
    22. We start to take responsibility for our trading results as we understand that our success is in us, not the methodology.
    23. We continue to trade and become more proficient with our methodology and our rules.
    24. As we trade we still have a tendency to violate our rips and our results are still erratic.
    25. We know we are close.
    26. We go back and research our rules.
    27. We build the confidence in our rules and go back into the market and trade.
    28. Our trading results are getting better, but we are still hesitating in executing our rules.
    29. We now see the importance of following our rules as we see the results of our trades when we don't follow them.
    30. We begin to see that our lack of success is within us (a lack of discipline in following the rules because of some kind of fear) and we begin to work on knowing ourselves better.
    31. We continue to trade and the market teaches us more and more about ourselves.
    32. We master our methodology and trading rules.
    33. We begin to consistently make money.
    34. We get a little overconfident and the market humbles us.
    35. We continue to learn our lessons.
    36. We stop thinking and allow our rules to trade for us (trading becomes boring, but successful) and our trading account continues to grow as we increase our contract size.
    37. We are making more money then we ever dreamed to be possible.
    38. We go on with our lives and accomplish many of the goals we had always dreamed of.
  • Quote from hermit_trader:

    Many guys said if you can survive the first year, then you may become a successful trader. Do you think you can stay in the market? It seems you can!
Quote from skanan:

All I can say is that I try to avoid doing stupid things. I can't say for sure about my longetivity since it's been about 4-5 months only. Thanks for your support though.
More...
 
Thanks! I hope to see myself somewhere in step 36 in the future. Not any time soon.

Quote from cnms2:

Check this. It's very true.
  • 38-Steps To Be A Successful Trader by Anonymous

    36. We stop thinking and allow our rules to trade for us (trading becomes boring, but successful) and our trading account continues to grow as we increase our contract size.
    37. We are making more money then we ever dreamed to be possible.
    38. We go on with our lives and accomplish many of the goals we had always dreamed of.
More...
 
Sold AAPL JAN 06 67.5/70 credit put spread for $0.60.

Reason: With the release of FOMC, I feel bullish on the market as a whole and AAPL is one of a good leader.
 
Sold Goog 390/400 Feb Put for $2.50.

Reason, a little bullish on goog news when goog Stock Price Target Rises to $600 by Piper Jaffray Analyst. I don't really have opinion whether it will be $600 or not but I feel that it should not come down to below $400 in Feb.
 
Skanan,

Do you have a limit for how far out you will go short gamma?

I personally, don't go further out than 40 days but preferably less - as little time to be wrong as possible.

MoMoney.

Quote from skanan:

Sold Goog 390/400 Feb Put for $2.50.

Reason, a little bullish on goog news when goog Stock Price Target Rises to $600 by Piper Jaffray Analyst. I don't really have opinion whether it will be $600 or not but I feel that it should not come down to below $400 in Feb.
More...
 
You must log in or register to reply here.
Back
Top