My Options Play
- Thread starter Multioption
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My posts do show a knowledge about options and the flaws of "TA".
I have listed many mistakes I made due to FEAR, GREED and pointed out the problems with LIMIT option orders (below the ask). I also brought up DELL's problems before earnings this Thurdsay, after a poster sold some naked DELL November puts at huge risk for only $150.00 credit, less commisssion ($300.00 debt plus commission to close at this time). I also asked a key "TA" question that doesn't get answered.
I have listed many mistakes I made due to FEAR, GREED and pointed out the problems with LIMIT option orders (below the ask). I also brought up DELL's problems, before earnings this Thursday, after a poster sold some naked DELL Nov puts. I also asked a key question that doesn't get answered.
There is nothing wrong with putting LIMIT option orders if you believe that there will be a correction and you are a swing trader.
DELL has no problem. It is still dominating PC industry. Their outlook was just slightly below the estimate. The stock got over-multi-punished. If the stock goes below 27.5 AH Nov 10,and stays below 27.5 till Nov option expiry date, I will gladly hug the shares at that price. I belive the stock will be around 30-31 area on option expiry date.
Your question did not get answered because it is not a real question. You are challenging Multioption not based on a solid fact.Your way of investment can be different from Multioption's and both can make money or all of us can disagree with each other and all end up losing money. I see that you recommend or used to recommend GOOG that I believe is super risky compared to selling naked PUT 27.5 for DELL. It is just so easy that GOOG drops $30 by an analyst's comment and still nothing has happened to GOOG but you will be smoked. I am more in favor of playing with INTC, XLNX, CSCO,DELL. Saying that both can make money or both can lose money.
There is nothing wrong with putting LIMIT option orders if you believe that there will be a correction and you are a swing trader.
DELL has no problem. It is still dominating PC industry. Their outlook was just slightly below the estimate. The stock got over-multi-punished. If the stock goes below 27.5 AH Nov 10,and stays below 27.5 till Nov option expiry date, I will gladly hug the shares at that price. I belive the stock will be around 30-31 area on option expiry date.
Your question did not get answered because it is not a real question. You are challenging Multioption not based on a solid fact.Your way of investment can be different from Multioption's and both can make money or all of us can disagree with each other and all end up losing money. I see that you recommend or used to recommend GOOG that I believe is super risky compared to selling naked PUT 27.5 for DELL. It is just so easy that GOOG drops $30 by an analyst's comment and still nothing has happened to GOOG but you will be smoked. I am more in favor of playing with INTC, XLNX, CSCO,DELL. Saying that both can make money or both can lose money.
You made me laugh with that link. Thanks. 
Some people take longer to realize how inept they are at what they believe to be true in their trading and in life.
Limits orders to buy on the bid or sell on the ask are worthless to this guy. He sees no possible way that one can utilize this type of order. He goes as far as stating the reality. Problem is, as long as it took him to type it is as long as he gave it any thought.
With that type of analysis on DELL by the OP i'd stick to trading bazooka joe comics.
Asians don't like to use credits cards so we will short DELL. You wouldn't know a product cycle or earnings lull if it hit you in that empty space you call your head.
Please enlighten us? I'd like to hear your thoughts on what BBY will do tomorrow and the next day? I'll wait for you to search for some cultural insignificant fact to give me the trading picture.
Very good question.
It is a very difficult decision. On the one hand yes you are right it might work(I didn't try it). How is your experience with stop loss limit orders ? Would you suggest using this approach ?
If price moves too fast, in a position that had violated "me" and I didn't want to be in anymore, why risk losing more ?
At the time, I was holding too many positions, I was just happy to have gotten out even if I had to pay more than I would have liked too.
I was afraid that if the limit price was exceeded in a fast moving market, the loss I was going to have to take was going to be even greater. In most cases my stop price level was correctly placed, but a clean exit wasn't possible. I wonder if anybody in this thread has experience with this. Is it because of the system IB uses? or are all other platforms the same? I believe they call it a "two touch____", meaning a lower price has to print twice in order for the stop order to trigger.
To me it sounds ridiculous. The MM is making the profit difference.
One day, as a (put) position was going against me, one that I had great conviction on, I noticed how price went up up up....passed my option price stop loss and something like 30 cents over. Right at that moment I canceled my order, and like night follows day, price went back down within a few minutes. This one ended up being a profitable trade as it took my profit target a few days later.
Is this magic ? I am supposed to place a large limit order above the market, go long the stock, once price almost reaches my limit price, cancel the stop order and short the stock. ... in other words play the MMs game? Fire with fire...? Haven't read about this in any book.
Any thoughts ?
I've struggled with stop orders in the same manner you seem to have. Eventually I decided: I have to pay for my peace of mind. So I use a stop order with a limit wide enough to allow for the regular slippage, maybe a dime more. This order is intended to protect me from a large gap. Under normal conditions I'll exit with a limit order when I see that my reason of entering the trade was not confirmed by price, IV or time frame. My stop limit orders are rarely hit, but I keep them as an insurance policy. On the other hand using near ITM options the risk is limited even in a catastrophic situation. This is other reason for which I don't like DITM options.
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