My option trades

[ryanpatrick]

Quote from probe1957:

You're doing well Ryan. No question about that. But don't get too cocky. Anyone can make money as long as there is a trend.

That's true, but I'm not trading any trend trading here. Just quick in and quick out with profits or losses. No need to look back just move forward to next trade. And there's no time to get cocky here, I haven't even reached my target yet. I'll get cocky once I'm up at the top there, but not now.

Already put the profits today to the test with apkt puts and el calls. about $900 total at risk there.

 

[jeffalvinson]

Ryan,

I have been following this thread since inception and I have noticed that you are trading smarter and smarter as time goes on.
Each trade has less risk with respect to your total account value and your not afraid to take any amount of profit when you think that trade has been open long enough. Really good job!

Jeff

 

[TraderBoy23]

geez could really go for QCOM picking it up here. not even close to its AH or PM levels. C'mon!

 

[ForexForex]

Quote from TraderBoy23:

geez could really go for QCOM picking it up here. not even close to its AH or PM levels. C'mon!

One solution to lock in profits during AH is to sell short 100 shares for each call option.

 

[ryanpatrick]

Quote from jeffalvinson:

Ryan,

I have been following this thread since inception and I have noticed that you are trading smarter and smarter as time goes on.
Each trade has less risk with respect to your total account value and your not afraid to take any amount of profit when you think that trade has been open long enough. Really good job!

Jeff

Thanks, I've always had experience on the stock side with these earning trades, but I am starting to get adjusted nicely into the option side of these trades. Still some stuff to work out like those losses in amzn, goog, and ph. I don't forget my losses at all.

 

[ryanpatrick]

Quote from TraderBoy23:

geez could really go for QCOM picking it up here. not even close to its AH or PM levels. C'mon!

I know right, it looked like qcom was about to break above 62 and just take off, but I think the slow push out the gate is from the market's weakness. I am seeing red in SP and DIA, qcom might be the few holding nasdaq intact, but it can't hold for long and the entire market doesn't follow through. Still, I checked and new highs is still about 17 to 1 on nyse and 10 to 1 on nasdaq, so we're still in a clear bull rally. I'm going to hold on and see what happens over the next 2 weeks, but I really think qcom should be able to test 65 soon. If not, then I'll just tell myself the gmcr trade covered these losses and move on. disappointed in qcom's action.

 

[TraderBoy23]

Quote from ryanpatrick:

I know right, it looked like qcom was about to break above 62 and just take off, but I think the slow push out the gate is from the market's weakness. I am seeing red in SP and DIA, qcom might be the few holding nasdaq intact, but it can't hold for long and the entire market doesn't follow through. Still, I checked and new highs is still about 17 to 1 on nyse and 10 to 1 on nasdaq, so we're still in a clear bull rally. I'm going to hold on and see what happens over the next 2 weeks, but I really think qcom should be able to test 65 soon. If not, then I'll just tell myself the gmcr trade covered these losses and move on. disappointed in qcom's action.

yeah same here, as far as disappointment goes. I know that usually the AH is overdone and the next day isn't quite as flattering, but I means this pathetic compared to what I had originally thought. I'm doing the same, holding and looking for a strong day in the market within the next few days to let QCOM do its run. good thing they're monthlies and weeklies

 

[jeffalvinson]

Quote from ryanpatrick:

Thanks, I've always had experience on the stock side with these earning trades, but I am starting to get adjusted nicely into the option side of these trades. Still some stuff to work out like those losses in amzn, goog, and ph. I don't forget my losses at all.

Ryan,

Your ability to emotionally handle those losses is the difference between an overly cautious trader and a good trader.
That courage is what made it possibly to turn $1,700 into
$6K or $7K in a month! That's totally amazing!

One interesting thing you might look at to help limit losses on
losing trades:
Look at the draw-down (-20%....-30%...-40%...-50%...etc..)
of only "winning trades" (not losing trades).
Here's how I use that info:
What if you see a pattern that says, "of all the winning trades, not one ever dropped below -36% before rebounding and going on to produce an executable profit?"
That would mean you could reasonably run a -40% stop on your trades, which would prevent further loss.
I check this kind of data constantly with my system of trading SPY options and even through all the volatility since Sept-2011,
no winning trade has ever had a drawdown greater than -23%.
Therefore I am using a -25% simple stop.


Jeff

 

[ryanpatrick]

added 2 amzn feb 3 2012 180 call at 1.67. I want to see how this one runs out tomorrow. Amzn always does this, gaps down and then runs up to cover the gap before all else. I'm looking for 185 before the close tomorrow and that's it.

 

[ryanpatrick]

Quote from jeffalvinson:

Ryan,

Your ability to emotionally handle those losses is the difference between an overly cautious trader and a good trader.
That courage is what made it possibly to turn $1,700 into
$6K or $7K in a month! That's totally amazing!

One interesting thing you might look at to help limit losses on
losing trades:
Look at the draw-down (-20%....-30%...-40%...-50%...etc..)
of only "winning trades" (not losing trades).
Here's how I use that info:
What if you see a pattern that says, "of all the winning trades, not one ever dropped below -36% before rebounding and going on to produce an executable profit?"
That would mean you could reasonably run a -40% stop on your trades, which would prevent further loss.
I check this kind of data constantly with my system of trading SPY options and even through all the volatility since Sept-2011,
no winning trade has ever had a drawdown greater than -23%.
Therefore I am using a -25% simple stop.


Jeff

Thanks for the view Jeff, I'll have to test it on trades that I hold for longer than 1 day. I'm not sure if it'll work on these earning trades especially when the trades are front month and can expire in days.