Option trading strategies

gar16ald1 · Nov 18, 2017

Hey guys,

I'm looking for any swing trading strategies, using options. Can anyone recommend any good strategies on any particular stocks/etfs? I already understand all the different types of options, so I am looking for something more specific, that works consistently. Any ideas would be appreciated.

daniel5198 · Nov 18, 2017

gar16ald1 said:
Hey guys,

I'm looking for any swing trading strategies, using options. Can anyone recommend any good strategies on any particular stocks/etfs? I already understand all the different types of options, so I am looking for something more specific, that works consistently. Any ideas would be appreciated.

"The Bull" by John Locke seems to be working well.

Kim Klaiman · Nov 18, 2017

gar16ald1 said:
Hey guys,

I'm looking for any swing trading strategies, using options. Can anyone recommend any good strategies on any particular stocks/etfs? I already understand all the different types of options, so I am looking for something more specific, that works consistently. Any ideas would be appreciated.

You need to decide what is your goal.

Do you prefer directional or non-directional? High risk high reward or lower risk lower reward? Do you want to aim for 50-100% gains (obviously with higher risk) or are you okay with consistent 10-20% winners with lower risk? What is the time frame? Days? Weeks? Months? How much maintenance you willing to have?

There are dozens of different strategies, each has different parameters.

lawrence-lugar · Nov 18, 2017

gar16ald1 said:
Can anyone recommend any good strategies on any particular stocks/etfs

Any ideas would be appreciated

All strategies are virtually the same -- but it all boils down technically, or stems from, your ability (or lack thereof) to predict the future.

The ultimate...is to be directional, and compound your trades/gains.
But that is risky, and requires great skill.
There's a whole plethora and subset of skills/strategies you can use to lower your risks, and spread yourself out a bit, for better or worse.

There is no right or wrong strategy, or better or worse strategy. You're paid for the risks that is available for your taking.
All strategies are basically meaningless, in the hands of an incompetent trader.

Hittfeld · Nov 19, 2017

daniel5198 said:
"The Bull" by John Locke seems to be working well.

Unfortunately "The Bull" won`t qualify - as it`s a free strategy. But it works.

ironchef · Nov 19, 2017

lawrence-lugar said:
The ultimate...is to be directional, and compound your trades/gains.
But that is risky, and requires great skill.

In general the US market has an up bias over reasonably long period (one's working life) and if one trades long persistently one can ride this persistent up bias (e.g., since 2009)? Perhaps the skill part is knowing when to get off or to regularly take money off the table.

Kim Klaiman · Nov 20, 2017

ironchef said:
In general the US market has an up bias over reasonably long period (one's working life) and if one trades long persistently one can ride this persistent up bias (e.g., since 2009)? Perhaps the skill part is knowing when to get off or to regularly take money off the table.

Easier said than done.

If you are long with options and implement leverage, any decent pullback will wipe out your account. Then long term up bias won't matter to you anymore.

ironchef · Nov 20, 2017

Kim Klaiman said:
Easier said than done.

If you are long with options and implement leverage, any decent pullback will wipe out your account. Then long term up bias won't matter to you anymore.

I agree in general. But if I am long option as a directional bet, I am already highly leveraged, to add another level of leverage using margins, or commit 100% of my asset playing the option game? Yes, I deserve to be wiped out. If your students do the same with your IC play, commit 100% of their assets to IC, they are at risk too.

Check out what Handle123 coached: Dance around with options, not going all in.

Kim Klaiman · Nov 20, 2017

ironchef said:
I agree in general. But if I am long option as a directional bet, I am already highly leveraged, to add another level of leverage using margins, or commit 100% of my asset playing the option game? Yes, I deserve to be wiped out. If your students do the same with your IC play, commit 100% of their assets to IC, they are at risk too.

Check out what Handle123 coached: Dance around with options, not going all in.

Generally speaking, I recommend to have at least 20-30% cash in options trading account.
Also don't forget that non directional strategies are different, they usually don't implement leverage. And if you have a well balanced portfolio, even big pullback should not hurt you.

Windlesham1 · Nov 25, 2017

gar16ald1 said:
Hey guys,

I'm looking for any swing trading strategies, using options. Can anyone recommend any good strategies on any particular stocks/etfs? I already understand all the different types of options, so I am looking for something more specific, that works consistently. Any ideas would be appreciated.

Forget the UK for stock options-and we only have the FTSE100 index no other optionable ETFs AFAIK so I presume you are trading the US market,which is liquid and run by intelligent brokers. the UK is hopeless but I persevere with our site: options investing.co.uk and we post real trades every week