My Options Play

[thenewguy]

Quote from Multioption:

I did not blow out, I withdraw (sic) my capital for a big project. Still trying to make $1.2M between now and August next year. It is possible! I have more screenshots that could shed more light to my confidence in direction trades, but I'm on the move right now (travelling).

I have a question, and a very important one: Why do many options' traders consider direction unimportant? I can remember very well many options savvy who have attempted to make money using complex strategies but ended up failing and woefully. Examples: QWave and Terry Tips.

With all the greeks, variables, and what have you, Option remains a derivative, so what's important? Underlying security or options?

I don't know any serious option traders that think direction is unimportant. I do know some who try to make it less important, however, but none that don't take it into consideration at all. Both the underlying security and the options (and all their greeks) are important in my mind. Personally, I don't have a good enough system so that I can completely disregard any advantages/disadvantages that I find, so I look for them everywhere. The better I can get at both, the more profitable I'll be.

- The New Guy

 

[cnms2]

Quote from Multioption:

...
I have a question, and a very important one: Why do many options' traders consider direction unimportant? I can remember very well many options savvy who have attempted to make money using complex strategies but ended up failing and woefully. Examples: QWave and Terry Tips.

With all the greeks, variables, and what have you, Option remains a derivative, so what's important? Underlying security or options?

Starting from the assumption that options are fairly priced based on what the market participants believe, any option position starts with a negative expectancy due to slippage and commission. If you're correct in your forecast of the evolution of the underlying price and/or IV, you overcome the pure probabilistic expectancy. Once in a profitable position, by adjusting you may lock in a positive expectancy (i.e. by pyramiding, opening new legs, etc.) if you want.

I'm with you that underlying price will determine much of the outcome, which will also be affected by the IV. I guess you agree with this, as I remember you writing that for high IV stocks you prefer opening spreads.

 

[Multioption]

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

I guess you're familiar with EOMplus. Yes! I'm the same person who used to run EOMplus. That was my greatest mistake as I ended up introducing newbies to options. Some did make it from $500 to over 12K but not 25K as projected. The problem was just too much on me, so much that I had to abandon the project and refunded some who didn't get trades. I wonder which of the OX auto-execute companies have/will succeed. OX Order placement process couldn't just do it for me!

I've been trying to get a programmer develop a software that can scan the intraday for a set of rules. Dagmar (my trainee) used a fine-tuned method to generate some returns that made me green with envy!

To those who want to contact Boa Dagmar, I lost touch with her in 2002 after several of them decided to start Options subscription services.

I don't run subscription service!

I shall be back...

 

[iceman1]

Quote from iceman1:

IF it is arbed back to 45 this week the Oct 50p would see 5+ .. from current 3..... but more likely it trades back to 47.50+ manana...

JMHO


**anyone trade NIHD

but more likely it (ANF) will trade back to a 47.50 exp. pin...! Of course it's only Wed! Almost got long near LOD. Good trading candidate.. definitely keeping it on my screen. Thanks Multi!

Multi_Option or anyone else -- ever trade NIHD ?

 

[ozzy]

FYI.

I made I believe 4500%-5000% in 2003 and most of it was due to directional option trades. This strategy has its importance and should not be downplayed (or cast aside) IMO.

 

[wabrew]

Quote from uninvited_guest:

They are selling options and hoping for time decay to work in their favor. If your buying options direction is very important and within a certain time and % move.

OK - I will add my .02 to this chit chat. Multi stated he usually only holds an option trade for a max of 7 days. In this case the typical decay you all refer to is not really a factor. I do not know how to do a screen shot, so I have attached a word.doc showing todays OCT WDC options.

You can see that the just-in-the money calls and puts are bid/offered with very small premiums.(And in size - the OCT 10 call had 415 contracts on the bid side and 310 offered).

Note that buying the calls or puts amounts to an approx 10%-15% margin compared to the stock. Now I do not know whether WDC is going up of down in the next 2 1/2 days, but the nickel premium is really cheap for those who have the balls to go long or short for a two day trade.

 

[pinabetal]

Quote from Multioption:



That screenshot was of my account started with just $10K in 2000. Unbelievable? Ask *Boa Dagmar of Fort Collins, Colorado.

why would you ask us to ask Boa if you can't tell us how to contact her. You now say you have lost contact with her in 2002. Why would you give her as a reference knowing you have no way to tell us how to contact her? She was your best student?? It seems strange that you would lose comtact with the cream of crop?? Please explain. On the other hand, one can't agree with live calls you have made.

 

[pinabetal]

Quote from ozzy:

FYI.

I made I believe 4500%-5000% in 2003 and most of it was due to directional option trades. This strategy has its importance and should not be downplayed (or cast aside) IMO.

Maybe you should be making the live calls!

 

[sdf89]

Multioption we are kind of on similar pages I think. I desire the same results you do. My account is just $500.00 on my very first trade the last week of Sept 2005 I netted 29% I bought a DJV VA put Oct ?102 for $1.55 sold on 10/7 for $2.30. My next 2 trades are not doing so well. I bought a BRYKL nov 60 call on10/17/05 for 2.80 my signals said put, but I bought a call because of my sentiment. Today I bought KFTWF nov 30 put for $1.80. My account is tapped out. So I'm gonna follow you on paper I guess. Thanks for your posts!

 

[thenewguy]

Quote from wabrew:

OK - I will add my .02 to this chit chat. Multi stated he usually only holds an option trade for a max of 7 days. In this case the typical decay you all refer to is not really a factor. I do not know how to do a screen shot, so I have attached a word.doc showing todays OCT WDC options.

You can see that the just-in-the money calls and puts are bid/offered with very small premiums.(And in size - the OCT 10 call had 415 contracts on the bid side and 310 offered).

Note that buying the calls or puts amounts to an approx 10%-15% margin compared to the stock. Now I do not know whether WDC is going up of down in the next 2 1/2 days, but the nickel premium is really cheap for those who have the balls to go long or short for a two day trade.

The options we bought had $.20 in theta risk, no way around that. That represents %10 of the position he initiated. 7 days is plenty time for time decay to kick in, especially 9 days til expiration.

- The New Guy