You still haven't answered the question yet. Why are you avoiding it?
My OPTION TRADES..... part 2
- Thread starter Put_Master
- Start date
You still haven't answered the question yet. Why are you avoiding it?
I am someone who shares actual "real trades", with real cash, in real time.
The last one being $25 CNW a few days ago.
Asking an open and honest investor like me, a silly "fantasy" trade question, about a stock and price, which I would never invest in, is ridiculous.
Meanwhile, I find it amusing that the individuals who love that APPLE trade so much, are the ones refusing to answer a potentially realistic question sbout their investment dropping a mere 3% to 639.
But it's clear they are not going to, so for the sake of the board, I'm done bantering over this issue.
Dude, you should really stick to your knitting, and this ain't it. Price both at the open tomorrow... add a dollar to spot, flat vol and recalc... the short put wins. Calc a small drop or rise in vol, the short put wins. Add $3 to spot... the short put wins.
$36 thetas on the put vs. $20 thetas on the spread (2.5x). Obviously more vega in the put. 1/2 the comms in the put and twice the spread (in the spread).
Now what were you stating?
Oh yeah. AAPL at 640 at Sep exp. Spread loses 4,440 (your number). Put loses 1,250.
<<< Oh yeah. AAPL at 640 at Sep exp. Spread loses 4,440. Put loses 1,250. >>>
Thank you ATTICUS. Now the rest of the board understands why they refused to answer my question about the stocks suffering a minor drop.
The math is very basic. It wasn't difficult to calculate if they wanted to.
But then again, for the 2 living in Fantasy Land, stocks don't ever drop, so that is never a consideration when making an investment.
Thank you ATTICUS. Now the rest of the board understands why they refused to answer my question about the stocks suffering a minor drop.
The math is very basic. It wasn't difficult to calculate if they wanted to.
But then again, for the 2 living in Fantasy Land, stocks don't ever drop, so that is never a consideration when making an investment.
AAPL....Sept....At Expiration
.............(1 contract)....(2 contracts).....(1 contract)
..............665..................665/640....... 600/590
........ . Naked Put............Spread............Spread
req:......65250.................3560...............968.......
Price...................................................................Prob
700.......1250.....................1440..............32..........26%
675.......1250.....................1440..............32..........48%
659........640......................0.0................32..........63%
652........0.0.....................(1365).............32..........68%
640.......(1000).................(3560).............32..........78%
625......(2700)..................(3560).............32..........86%
600......(5200)..................(3560).............32..........95%
575......(7700)..................(3560)...........(968)........99%
It's a matter of preference, where on the continuum you have your most
concerns, where your skills are and where your fears are and what you are doing.
e.g. I do the 600/590 sort of spread (never on apple) and I usually do 3 contracts. i.e. I am not trying to get a major part of my income from these trades. I would have to do 40 contracts to equal the naked put in dollars. That number is rediculous to me. I don't put that kind of money in these or any other option trades. My money is in treasuries and mutual funds like Hussman's... and real estate. This activity, for me, is purely recreational. I made my serious money building a Clinical Trials service company and selling it.
If you are doing this stuff to actually make serious money then you shouldn't pay any attention to me... nor I to you. We are in totally different universes... and that's why things look so different to us.
e.g when I read Atticus saying:
Price both at the open tomorrow... add a dollar to spot, flat vol and recalc... the short put wins. Calc a small drop or rise in vol, the short put wins. Add $3 to spot... the short put wins.
$36 thetas on the put vs. $20 thetas on the spread (2.5x). Obviously more vega in the put. 1/2 the comms in the put and twice the spread (in the spread).
I just laugh. I have NO idea what he's talking about (sometimes I doubt he is talking about anything... that it's just blowing smoke in our face) and I frankly don't care.
.............(1 contract)....(2 contracts).....(1 contract)
..............665..................665/640....... 600/590
........ . Naked Put............Spread............Spread
req:......65250.................3560...............968.......
Price...................................................................Prob
700.......1250.....................1440..............32..........26%
675.......1250.....................1440..............32..........48%
659........640......................0.0................32..........63%
652........0.0.....................(1365).............32..........68%
640.......(1000).................(3560).............32..........78%
625......(2700)..................(3560).............32..........86%
600......(5200)..................(3560).............32..........95%
575......(7700)..................(3560)...........(968)........99%
It's a matter of preference, where on the continuum you have your most
concerns, where your skills are and where your fears are and what you are doing.
e.g. I do the 600/590 sort of spread (never on apple) and I usually do 3 contracts. i.e. I am not trying to get a major part of my income from these trades. I would have to do 40 contracts to equal the naked put in dollars. That number is rediculous to me. I don't put that kind of money in these or any other option trades. My money is in treasuries and mutual funds like Hussman's... and real estate. This activity, for me, is purely recreational. I made my serious money building a Clinical Trials service company and selling it.
If you are doing this stuff to actually make serious money then you shouldn't pay any attention to me... nor I to you. We are in totally different universes... and that's why things look so different to us.
e.g when I read Atticus saying:
Price both at the open tomorrow... add a dollar to spot, flat vol and recalc... the short put wins. Calc a small drop or rise in vol, the short put wins. Add $3 to spot... the short put wins.
$36 thetas on the put vs. $20 thetas on the spread (2.5x). Obviously more vega in the put. 1/2 the comms in the put and twice the spread (in the spread).
I just laugh. I have NO idea what he's talking about (sometimes I doubt he is talking about anything... that it's just blowing smoke in our face) and I frankly don't care.
My point exactly... I know I want to work a low delta on my credit spreads.... Do not comletely understand the formula behind delt and other Greeks.... but I do learn from these exchanges on how greeks impact decisions.
