My option trades

[falconview]

Jeff

I see the VIX is dropping, so that should make it harder for you to make money with long options.

The VIX and the daily Average True Range ( ATR ) pretty much reflect each other. When the VIX drops, the daily bar in the charts get shorter. Which means there is less price movement. This means you can require more days to get enough of an increase in VIX to make a long option pay off, as the amount of price increase gets smaller and smaller as reflected in the shorter daily bars.

 

[atticus]

Quote from falconview:

Jeff

I see the VIX is dropping, so that should make it harder for you to make money with long options.

The VIX and the daily Average True Range ( ATR ) pretty much reflect each other. When the VIX drops, the daily bar in the charts get shorter. Which means there is less price movement. This means you can require more days to get enough of an increase in VIX to make a long option pay off, as the amount of price increase gets smaller and smaller as reflected in the shorter daily bars.

Don't rely on VIX as an indication of relative vol. Best to remove VIX entirely from that equation.

 

[jeffalvinson]

Quote from falconview:

Jeff

I see the VIX is dropping, so that should make it harder for you to make money with long options.

The VIX and the daily Average True Range ( ATR ) pretty much reflect each other. When the VIX drops, the daily bar in the charts get shorter. Which means there is less price movement. This means you can require more days to get enough of an increase in VIX to make a long option pay off, as the amount of price increase gets smaller and smaller as reflected in the shorter daily bars.

falcon,

I have made money with directional trades when the VIX was
10 to 15 range during the early to mid-part of the bull market of 2003 to 2007.
When low VIX occurs, I simply adjust the the VIX parameter in my trading program and suddenly a trading system that was looking for big discounted entries and profits is all the sudden looking for small discounted entries and smaller profits.
The VIX was the last piece of the puzzle that I learned which actually gave my trade systems the ability to have at least adequate performance in all market environments.

Jeff

 

[babutime]

Huge ebay block trade at July 40.

15000 contracts

 

[jeffalvinson]

Quote from babutime:

Huge ebay block trade at July 40.

15000 contracts

babu,

It will be interesting to see if that block of 15K July 40 call contracts moves into Open Interest tomorrow. That might prove some type of conviction in direction within the next 3 months. Otherwise, if it doesn't move into Open Interest, its fairly meaningless.
Even if this block moves into O.I. tomorrow, it could also just be some insider who has 1.5 million shares, who knows this stock won't get above 40 by July expiration, because he knows what's going on with earnings, so he sold calls on his stock to make a few extra bucks.

 

[newwurldmn]

Quote from babutime:

Huge ebay block trade at July 40.

15000 contracts

15,000 contracts as a block trade for a name like EBAY isn't unusual. I wouldn't try to read into it. Many blocks of 10k+ trade every day.

 

[babutime]

Quote from newwurldmn:

15,000 contracts as a block trade for a name like EBAY isn't unusual. I wouldn't try to read into it. Many blocks of 10k+ trade every day.

Well it's their earnings today in a few moments. So I thought it might have something to do with it.

I had a "bearish" Qualcomm butterfly going into earnings betting it'll fall. Right after this analyst interview news surfaced that it might have weaker results next time. This thing flew right out of the lower wing lol... o well tiny loss... nothing that i can't handle. I'll probably break even above 66.5..

Sucks losing money even when you're right..haha

 

[newwurldmn]

Quote from babutime:

Well it's their earnings today in a few moments. So I thought it might have something to do with it.

I had a "bearish" Qualcomm butterfly going into earnings betting it'll fall. Right after this analyst interview news surfaced that it might have weaker results next time. This thing flew right out of the lower wing lol... o well tiny loss... nothing that i can't handle. I'll probably break even above 66.5..

Sucks losing money even when you're right..haha

I personally think that's the worst trading sin: being right and losing money.

Yeah, 15,000 contracts at 1.7 = like a 2.5MM bet. Almost a tiny punt if you are a 700MM long short fund.

 

[RichardRimes]

Quote from babutime:

I'm out of ISRG. Originally at a $1000 profit, slippage and stock's swift rise caused a -$300 loss.

It's a pain in IB to quickly close orders... I wish it were more like ThinkOrSwim.

Closed BIDU as well. WAsn't worth holding on to it. I won't smack myself if it rises now.

I've had a rough couple weeks. Quite a few losses.

Why is it a pain? I've only used TOS but when I tried out IB it seemed fairly easy.

 

[babutime]

Quote from RichardRimes:

Why is it a pain? I've only used TOS but when I tried out IB it seemed fairly easy.

It is except when you're so used to TOS's interface- I use it to enter simulated orders just to visualize my risk. It's a really good proxy for your actual trades.

I wish IB spent a little bit more time improving their system. Nothing wrong. Just could compete a bit better if they had a few more upgrades- like better risk graphs, etc...