ANF 50 Put looks tempting. I'm watching!
My Options Play
- Thread starter Multioption
- Start date
- Status
Not the case at all, and way off the mark if you are directing this at me.Quote from iceman1:
amazing how anyone who sets really BIG goals that are seemingly impossible to achieve by most... is met with all kinds of negative feedback. Perhaps that's why we have a bell curve of life..... most people believe only mediocrity is possible for 'them'. So they judge others by their low standards and views of what is possible.
Think about it..... the next time you set limits on your achievement goals.
IcE
We are talking about two different things here. Not that some people can't believe in other's success. Hell, I believe Multi - he sure has the account, anyway. My "delusional" and "con man" comments were tongue and cheek. And haven't I congratulated him on a profitable ballsy trade?
The only point I've ever tried to make here, is the extreme way the odds are against you for Multi's type of trading. That he's beat those odds thru skill or whatever doesn't matter.
I don't care what your "system" or "indicators" are, you don't know with near enough certainty what that stock or the market will do next. Can you do well enough to profit? Of course, that's why we are here.
As has been pointed out already by d-v, there is a darn near mathematical certainty of a complete wipeout. The "risk of ruin" is too great. Can a great trader do well with Multi's risky trades and overcome this risk for an extended time? Sure, but there will be 10-100-1000, or whatever, great traders that will fail.
It's close to the idea you can overcome negative expectation bets at roulette with money management. Nope. Not for an extended time. So can you take a slightly positive expectation trade and throw huge size and risk at it and survive? Not for long.
I think Multi's great. Let 'em rip! But to suggest that doing very risky trades somehow sets the standard for success in life is ...wrong.
Good luck to all
C
Okay I'm only a rookie but it seems to me that the options market is set up for limiting risk. I looked at his trade and it doesn't seem that risky. Its not like he's writing calls or something.
I'm not trying to be arguementive, I just am learning, and I'm not sure I understand why you think its risky.
I had the same feeling when I started looking at using options as another tool. Here is what I've learned so far (please note, I AM NOT A PRO).
1. Options can be very complex, and there are many very good investors/traders taking the other side of your trades. Tough crowd to beat.
2. Although buying outright calls (or puts) can limit your risk, it takes a lot less movement to incur big losses because of the leverage it allows you to use (and trust me, most newbs use it).
3. Time works against you when you buy options, sometimes very quickly.
4. Spreads are big, for volitile stocks, even bigger. Most of the risk is priced in by the MM (with VERY few exceptions) and they are taking statistically advantagous trades against you.
5. Building on the last one, every option trade has a negative expectancy.
6. More specific to his trade was the fact that he used 1/4 of that account's trading capital for one trade, and also it was put on one week before expiration. The stock could have stayed at the same price and he would have lost a lot of money, very quickly. The first day of his trade he had lost 1/2 the value of the position. This is a riskier trade that indicates he has a very high confidence in his pick, or that he was more than willing to lose whatever money he put in.
This is just my $.02, would love it if other more experienced people could elaborate/correct this.
Thanks,
- The New Guy
Hello Multioption. In reviewing your posts and account statements it occurred to me that you might be the guy who used to post to the misc.invest.options group pushing EOM Plus. Am I right? Just curious. On another note I noticed in one of your earlier posts that perhaps you could use some help finding suitable stocks that met your technical criteria. I have quite a bit of experience writing scans for stocks using various different software programs. I'm sure others on this board have as well. Perhaps we could help you if I/we knew a little more about your criteria 
Regards
Regards
I guess this first trade was not riskier than buying 4,000 shares of PEET at $31.85 and having a stop loss at $30.15. Multioption payed $2.2 for the October 30 calls, and set a stop at $-1.7. If his risk of $1.7*4,000 was acceptable for his trading account (much larger than the $20k he ear-marked for this exercise), I don't see anything wrong with it.
Instead of the "you gamble" etc. comments, I'd like to read more opinions about the trade itself: different underlying outlooks, different strikes, expirations, strategies, different stop loss and exit points, and why.
I appreciate Multioption's will to openely share his real trades.
Thanks Multioption!
Instead of the "you gamble" etc. comments, I'd like to read more opinions about the trade itself: different underlying outlooks, different strikes, expirations, strategies, different stop loss and exit points, and why.
I appreciate Multioption's will to openely share his real trades.
Thanks Multioption!
Quote from cnms2:
I guess this first trade was not riskier than buying 4,000 shares of PEET at $31.85 and having a stop loss at $30.15. Multioption payed $2.2 for the October 30 calls, and set a stop at $-1.7. If his risk of $1.7*4,000 was acceptable for his trading account (much larger than the $20k he ear-marked for this exercise), I don't see anything wrong with it.
Instead of the "you gamble" etc. comments, I'd like to read more opinions about the trade itself: different underlying outlooks, different strikes, expirations, strategies, different stop loss and exit points, and why.
I appreciate Multioption's will to openely share his real trades.
Thanks Multioption!
MUCH riskier, if only for the fact that it had a week to work out, and no more.
- The New Guy
Quote from maxreturn:
Hello Multioption. In reviewing your posts and account statements it occurred to me that you might be the guy who used to post to the misc.invest.options group pushing EOM Plus. Am I right? Just curious. On another note I noticed in one of your earlier posts that perhaps you could use some help finding suitable stocks that met your technical criteria. I have quite a bit of experience writing scans for stocks using various different software programs. I'm sure others on this board have as well. Perhaps we could help you if I/we knew a little more about your criteria
Regards
Congrats on your first post, I see that you carefully selected it!
- The New Guy
- Status