Oh My God - Not Again

Quote from Sanjuro:

You should've shared your ICE trade with us for opinions when you bought the calls.

Please remember ET next time you put on the 50k easy money trade.

Good Luck!
More...

But the members on ET don't know jack sh!t about options, trading, or anything to do with investments. They are all clueless.
 
Quote from jeffalvinson:

Forex,

I sympathize with your decision to quit.
When I was first learning to trade options, I blew out 2 accounts in the first year!
Then I decided it was time to stop trading and start learning.
Here what I learned in 10 years of option trading:
1: "Money Management and Trade Management are just as important as a good stock or index pick."

Example:
$10,000 Option Account.

A: Never use more than 10% of your total option account per
trade.

B: Have a profit goal, a stop loss amount, and a time limit established before you enter the trade.

C: Do not allow the stop loss value to be higher than the profit value. This is the Reward to Risk Ratio.
The Reward to Risk Ratio of each trade I do is determined by
the Win/Loss Ratio of that individual system's trade.
I do at least 2 different kinds of trades:

1: High Win/Loss systems (W/L: 75%) trades that produce frequent trades and Modest Profits. With these systems I can afford a Reward to Risk Ratio of roughly 1/1.
Example for a 12 trade High W/L method month:
9 winners at +30% profit = +270%
3 losers at -25% loss...... = - 75%
Gross Monthly Profit........ = +195%.
Because only 10% of the option trading account is used for each trade, to determine the total account gain you simply move the
decimal point over to the left by one place:
+195% = +19.5% account gain.
"Most importantly, with a -25% stop loss you do not lose more than 2.5% of your total option trading account."
"That means it would take approximately 40 consecutive losing trades to wipe out an account!"

2: Infrequent Large Gain trades which occur a few times a month
at key turning points in the market.
These have a lower W/L ratio (W/L: 50%), but the Reward to
Risk Ratio (4/1) makes up for the low W/L ratio.
Example of a 4 trade Large Gain method month:
2 winners at +100% = +200%
2 losers at -25%.......= - 50%
Gross Monthly Gain...= +150%
+15% account gain.

I use I.B. bracket orders for all trades.
Bracket Order Example for High W/L Method:
Buy Limit: 2.00
Sell Limit: 2.60
Stop Limit: 1.50
Click transmit and walk away.
2 to 3 day time limit.

Bracket Order Example for Large Gain Method:
Buy Limit: 2.00
Sell Limit: 4.00
Stop Limit: 1.50
Click transmit and walk away.
4 to 5 day time limit.


I hope that was helpful.


Jeff
More...

jeff
are you trading FOOM debit and credit spreads for high win trades?
Do you know before hand if the option trade will try for a larger gain ?
I see your bracket trading has a stop of of .50 on both highW/L
and large gain Trades .Aren't larger gains the product of larger moves against?
I have an acc. at ib also i'll look into baracket trading...sounds interesting
cheers john
 
Quote from appleseed:

jeff
are you trading FOOM debit and credit spreads for high win trades?

Answer: No
I buy straight calls and puts using complex mathematical momentum formula's for the OEX and SPY.


Do you know before hand if the option trade will try for a larger gain ?
Answer: Yes
My large gain trades are based on candlestick reading and moving averages.


I see your bracket trading has a stop of of .50 on both highW/L
and large gain Trades .Aren't larger gains the product of larger moves against?
Answer: No
On Large Gain trades, it either has to go in my direction with modest drawdown, or it gets stopped out.


I have an acc. at ib also i'll look into baracket trading...sounds interesting
cheers john
More...


Good questions John, I enjoyed the correspondence.


Jeff
 
Quote from forex-forex:

But the members on ET don't know jack sh!t about options, trading, or anything to do with investments. They are all clueless.
More...
Hi FF
Some know a lot, some are clueless and most are somewhere in between. Who belongs to which group you have to work out yourself.
Unfortunately, at the moment, you are very angry and upset - understandably so since you have suffered some rather hefty losses. So you need to make a decision, either to continue trading or quit. If the former then you really need to start learning about options trading in some depth - and I don't mean just coming to ET and reading the posts. I've been following your posts over the past year or so and you've obviously done some study. But it's nowhere near enough. Do some serious reading/workshops or whatever it takes if options trading is really something you want to become proficient in.
Whichever route you decide to take, I wish you all the best.
Cheers
db
 
Quote from forex-forex:

But the members on ET don't know jack sh!t about options, trading, or anything to do with investments. They are all clueless.
More...

We all gave you detailed reasons why your trade made no sense when you first entered it. Its your own fault for ignoring the good advice.

It is like stepping in dog shit, sniffing it, touching it, licking it and eating it and then complaining to everyone you stepped in dog shit...

Remember the ol saying, a fool and his money... are often faded..
 
Quote from optioncoach:


Remember the ol saying, a fool and his money... are often faded..
More...

Michael Douglass as Wall Street's Gordon Gecko, "A fool and his money are lucky to have gotten together in the first place."
 
You must log in or register to reply here.
Back
Top