My Options Play
- Thread starter Multioption
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Why the fvck would you ask "Multi" for his opinion on your suggested trade?
He has posted only 3 trades, 2 have been very questionable (BBY, PEET). His screen shot of his account is for a 1 month period 30 months ago. Does a 2 1/2 year old screen shot of 1 month worth of trading impress you? What happened with those other 29 months?
I'm keenly following this thread and recent developments...my preoccupation now is to find trending stocks...the market seems to be dragging "all" with it!
My thought on VZ: The trend is in bearish mode yet dangerous as it could rally. The intraday chart is suggesting a brief bullish move which may/may-not hold. The stock is technically at equilibrium...it's dicey. Hard to call!
AAPL is trending up and is not being dragged around by the market.
http://finance.yahoo.com/q/bc?t=1y&s=AAPL&l=on&z=m&q=l&c=qqqq&c=^IXIC
I hope there's no personal vendetta? You sound rather bitter!
This thread wasn't created for you. I set it up to post my picks as I trade. I guess you can start a thread for your option plays.
He initiated this thread, which I consider a good idea.
Also, I like this kind of swing trading using options as surrogate. I agree with somebody's post that these are not pure option plays, but I'm part of the crowd that believes that options are fairly priced by the market, and that any options position has a negative expectancy when initially opened due to slippage and commissions.
Options are a great instrument as a surrogate: allow better risk control, offer leverage, but will work only when you choose the correct strategy for your outlook regarding the underlying price, the options IV, for the given time frame, and you're right about these.
Also, I'm intrigued by Multi's challenge to increase his money 5 fold in less than three months. This is entertaining like a reality-based show (although I hate most of those).
I don't think uninvited_guest has anything to offer than his invective. He could as well open a thread and post his options plays.Quote from cnms2:
He initiated this thread, which I consider a good idea.
Also, I like this kind of swing trading using options as surrogate. I agree with somebody's post that these are not pure option plays, but I'm part of the crowd that believes that options are fairly priced by the market, and that any options position has a negative expectancy when initially opened due to slippage and commissions.
Options are a great instrument as a surrogate: allow better risk control, offer leverage, but will work only when you choose the correct strategy for your outlook regarding the underlying price, the options IV, for the given time frame, and you're right about these.
Also, I'm intrigued by Multi's challenge to increase his money 5 fold in less than three months. This is entertaining like a reality-based show (although I hate most of those).
U_guest:
My take on AAPL: at all time high and strong uptrend.
I believe it is due for a retracement, and probably sooner than later. There are bearish divergences in all the time frames. Its beta is 1.52, so in a market downtrend will probably go down more.
Current IV at 35-36% is relatively low historically.
My intraday charts indicate that this is a good point to enter short, with a stop loss around $60, and a 1-2 week exit target of about $53.7.
I'd place a limit order at $3.8 for Nov 60 puts (QAAWL), currently 3.7/3.9, with a stop loss order at $2, and a limit for taking profits at $6.4. This is a reward / risk ratio of 2.6/1.8 ~1.45.
NOTE: I do my assessments and trading plans knowing that I'll win some and lose some, trying to enter with a probability better than 50%, and trying to have my average win larger than my average loss. I do not expect / hope anything from the market, just observe what's happening, make a plan and enter when I perceive an opportunity. Then I follow my plan, avoiding to reassess it once I'm in. When I encounter a string of losses I stop and cool down. I protect myself from ruin by sizing my positions to risk about 1% of my trading capital (not of my net worth). I'm always looking around to find new sources to learn from, understand more, and apply it.
Why place a LIMIT order at $3.80 when the ASK is at $3.90? It will not get filled. If you are right your order goes unfilled because you tried to save $0.10, it only gets filled if AAPL moves against you ( I know from trying to save $0.05 on the QQQQ options). Why not a MARKET order or LIMIT at the ASK price ($3.90)? Order gets filled and you can call it the day.
The only reason someone would place a LIMIT order for less than the ASK is because they are unsure of their trade.
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