Options Trades For Capital Growth

[Quest2016]

BTO 12 contracts of PRAA March 30 Call at 1.70 - Bad fill, but will set stop limit at 1.35

 

[Quest2016]

Are you trying to use SPY options? Plenty of opportunities in the last few days. We can't wait for the first trade...

Here, I will show you how to do it, this is what I have been tinkering with, 7 trades 6 winners, just like you wanted 30-50% returns...

This trading venture is an experiment. l will consider trading GLD, SPY, TLT options later.

 

[OptionGuru]

BTO 12 contracts of PRAA March 30 Call at 1.70 - Bad fill, but will set stop limit at 1.35

• Why do you think that's a bad fill? The ask was $1.85.
• IMO ......... Your stop limits will contribute to your downfall.

 

[ironchef]

• Why do you think that's a bad fill? The ask was $1.85.
• IMO ......... Your stop limits will contribute to your downfall.

Is it true that when you are long, you will you be stopped out at bid and if you are short you are stopped out at ask? If so in thinly traded situation you can be gamed and stopped out.

 

[OptionGuru]

Is it true that when you are long, you will you be stopped out at bid and if you are short you are stopped out at ask? If so in thinly traded situation you can be gamed and stopped out.

Yes ..... When the bid hits $1.35 the position will be closed. IMO .....Options are too volatile for stops.

In the OPs case I would have gone with 3 contracts, no stops for a total risk of $510 versus 12 contracts with a stop at $1.35 and risk of $420.

 

[botpro]

Hi traders,
I am new on this forum, but not new to trading. I want to use this thread to showcase the result of trading approach developed to grow a shoestring budget with Option trades.

I want to experiment how long it will take to initiate 20 option trades with at least 50% minimum ROI per trade.

50% per trade?
Come on, that's too much! 10% per trade should be enough, IMO.
And the longer you keep the stuff, the more will you be penalized by time decay.
Best is to make about 5 to 10% quickly and close that pos immediately b/c of time-decay...
Ie. repeat that as many times as possible in the shortest time possible...
But: you can't because of the DayTrading rules... ;-(
You need an account of at least $25k for being able to do as many trades as you like.
And it never may fall below $25k, otherwise problems with your broker and exchange are pre-programmed...

 

[Georgi90]

BTO 12 contracts of PRAA March 30 Call at 1.70 - Bad fill, but will set stop limit at 1.35

View attachment 161517

This stock is on a southeast trip since august last year. I would rather try to get 50 cents for 22.5/20 put credit spread

 

[ironchef]

Yes ..... When the bid hits $1.35 the position will be closed. IMO .....Options are too volatile for stops.

In the OPs case I would have gone with 3 contracts, no stops for a total risk of $510 versus 12 contracts with a stop at $1.35 and risk of $420.

What is your rationale? How about going with OP's 12 contracts but only mentally stop @$1.35?

 

[Quest2016]

I closed the position at $1.76 a piece.

Next....

 

[OptionGuru]

Yes ..... When the bid hits $1.35 the position will be closed. IMO .....Options are too volatile for stops.

In the OPs case I would have gone with 3 contracts, no stops for a total risk of $510 versus 12 contracts with a stop at $1.35 and risk of $420.

What is your rationale? How about going with OP's 12 contracts but only mentally stop @$1.35?

Options are too volatile for stops - they could go down to $1.00 and then back to $3.00 the next day, that happens all the time. A big advantage of options over futures is that you don't have to get stopped out of a trade only to see it rebound without you.

I picked the 3 contracts at $1.70 without stops because the risk is approximately the same has 12 contracts with a stop at $1.35 - $510 vs $420. My intention would be to keep the trade open and give it time to develop - even if it expires worthless.