LEH naked jan call, need advise on exiting

Newguy...

Here is the smartest advice you will get.

Stop being stupid (harshness is needed here) and put $40k in a position you know nothing about.

Take your loss like a man and get out while you can and write the loss down on a post it and stick it to your computer to remind you of what can happen when you go where you know nothing at all.

Take the rest of the money and spend a tiny amount on your option education.

With all due respect to my brethern here, anyone who has told you anything else beside sell and get out and learn is giving you bad advice.

You have no business throwing that kind of money in options with your limited knowledge even if you are a multimillionaire because it is beyond ignorant.

STOP and walk away and with no money in the market, proceed to learn the basics of calls and puts and the greeks and option pricing and then come back really small to learn.

I cannot fathom how many newbies donate over their head into something they know nothing about. I did it and wish someone would have slapped me and said take your money out and learn so I am doing it for you.

Forget any advice outside of what I said and you will thank me. No one here has your best interests over your money except yourself so take some responsibility and LEARN first before throwing good money away.

SELL THE POSIITON AND GET OUT NOW WITH SOME MONEY LEFT AND PRIDE AND FOCUS ON EDUCATION.

Ignore me at your own risk. If you cannot even close out a long call that has gone bad and you do not have the strength to have a stop loss, then forget about strangles, straddles, or any other strategy you know nothing about.
 
Quote from boost123:

Newguy05.

You over estimate Atticus! You traded 40 contracts in one trade. Where can you find Atticus trading over 40 contracts on one trade on here?

I also remember Atticus accusing another Option trader as being INSANE for opening a CALL RATIO position. If Atticus had advanced knowledge on CALL RATIO OPTIONS he would NOT have made that "INSANE" comment to that person.

I do SHORT STRANGLES on index on many contracts and both ends naked. This would be seen as INSANE by people like Atticus.:D
More...

The only thing insane is you advocating naked strangles to a complete newbie. Atticus has more option knowledge on a drunk comotosed day than you have wide awake.

How do I know this? Because you are telling a newbie who dropped $40k to do short strangles, one of the more riskier strategies a person can do.

And just because Atty does not post a trade here with over 40 contracts means he does not do it lol....

Newbie, put this person on ignore or follow him and lose more money since you do not know what you are doing. Insanity is blindly following bad advice.
 
lol Boost..

good luck with your naked strangles but newguy has a long road to travel before he can consider whether those are right for him. Options requires crawling before walking and short straddles is flying so long road to go..
 
Quote from dipper17:

Ever get the feeling that some screen names are just set up to tout other screen names?
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There is no big conspiracy...some of the names have been around quite a while and been very helpful (consistently) so they are respected for both their knowledge and generosity in giving it freely :)

Atticus is the new name for a trader active on ET since 02 and without whom ET would (for us option traders) be a very dull place.

check out optiontrading coach's SPX journal and you'll see.......a great number of good generous knowledgeable contributors.
 
I certainly believe you are twice my age because the eyesight is the first thing to go. Must be the reason why you missed the first line of Newguy's post explaining that he was a newbie. Also for you to think that just because he traded 40 contracts he must not be a newbie makes no sense. The logic is that if you put your first trade on real big you are not a newbie.

Please find me a broker that will isntruct as newbie to trade naked strangles... I will say your quest will be a fruitless one. If you like em use em, but to advocate a newbie start selling short strangles is dangerous. I would love to hear any experience option trader advocate short strangles for the newbie who knows nothing of the Greeks or option pricing, especially volatility.

Moreover, for someone as experienced as you it should be quite clear why ignoring volatility is a no no when trading short options.

Quote from boost123:

POSTED BY OPTION COACH.
"Newbie, put this person on ignore or follow him and lose more money since you do not know what you are doing. Insanity is blindly following bad advice."

Optioncoach,

I did not know that Newguy was a newbie. Trading 40 contracts on options does NOT spell out NEWBIE to me.

I am about twice your age and have traded options while you were still at junior school.

My advice to NEWGUY was the CORRECT ONE and he would have recovered his loses within 3 mths! If he contacted me by pm i would have given him 10yrs of knowledge on how best to convert that LONG CALL position in less than one hour over the phone.

Newguy05. Come back in a few months after you have learned more on Options and tell US if my advice was GOOD or SH!TE

Infact, ask your broker about my advice on short OTM strangles and he will tell you the truth! Forget ABOUT STRADDLES!

Happy new year to all at ET

Booster
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For the cephalic fool -- you're not compensated for selling curvature. OTM options are leveraged to gamma, +dgamma/dspot, ATM/ITM options carry the opposing sign. Don't sell leveraged gamma unless compensated by the vol-smile. Knowing that one strangle strike will remain profitable at expiration is akin to knowing you have a pee pee. Apparently Capuchin monkeys aren't endangered after all.
 
Quote from boost123:

Optioncoach.

I remember you doing short naked options, RATIO etc and i never wished you GOOD LUCK!!

Advanced option traders DONT trade on GOOD LUCK!:D

A naked option trader or a short OTM strangler is an advanced trader who trades mainlly against the Market Makers and NEVER trades on LUCK!! he is what is known as an APPROVED WRITER by his broker!!

Have a good and happy new year

Regards

Booster
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I did ratio spreads but I do not advocate newbies do them. that is the big difference.

And since it offends you, I am sorry for wishing you luck then lol :D

Most importantly you freely admit that a naked option writer is an advanced trader.

Which means telling a newbie to do naked options was contrary to that statement and incorrect advice.

Thank you for proving my point and saving Newguy from some really bad lossed in the future. When Newguy learns option pricing, greeks and masters volatility he can then come over to your holy grail but for now as you admit, naked options are for advanced traders and not for this newbie so you need not continue to push him to do naked options.

and since I cannot wish you luck, I wish you good fortune in 2008 all based on skill :D
 
So ask him to give you all his money and trade it for him letting him know you are an advanced trader. You just admitted naked options is an advanced trader's strategy but you want a newbie to do it.....

Which is it then...
 
optioncoach,

i dont mind the harsh advise, actually it's refreshing. But please read my replies in this thread from beginning, i certainly made my share of mistakes on this trade but wasnt just dropping 40k cluelessly on a whim. I started this thread looking for more of technical analysis on the call/underlying on an exit strategy

Anyway good general advise, i already reduced my position by 30 contracts yesterday when it went up to 6.2. Have 10 strike60 calls left with 10 strike70 shorts to cover some loss. I still believe Leh will make a run to 67 in Jan, so will holdon to the last 10 for a while longer.

Boost123,

please, you are taking this thread way off topic. Just stop posting. thanks
 
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