Profitable Options Traders - Long Term

NPTrader · Sep 12, 2018

Possibly yes - there were some big call buying winners.

But also I could have easily been a winner too. Strike placement for me when selling large amounts of naked calls can mean something going OTM or caught ITM and then rolling aggressively to adjust. Had I picked a couple of less aggressive strokes in November I may have been able to stay OTM. I would have been the winner then. Either way I just keep rolling and adjusting and eventually always get my pound of flesh.

beerntrading · Sep 13, 2018

NPTrader said:
But also I could have easily been a winner too. Strike placement for me when selling large amounts of naked calls can mean something going OTM or caught ITM and then rolling aggressively to adjust. Had I picked a couple of less aggressive strokes in November I may have been able to stay OTM. I would have been the winner then. Either way I just keep rolling and adjusting and eventually always get my pound of flesh.

True enough. Hardly any gaps during that time, all nice, smooth intraday moves. Would have been easy to delta hedge and take a few pennies in premium.

ubpuujee · Sep 20, 2018

NPTrader said:
some. I never had any fears or nervousness that I was going to permanently lose the money. Whatever goes up with price in SPX eventually comes dow

which broker do you use?

NPTrader · Sep 20, 2018

Thinkorswim with TDA

chyldom · Sep 26, 2018

smallfil said:
There is no non-directional strategy. I tried option spreads and lost thousands. It doesn't make sense to try and gain $200-$300 on one trade while, losing thousands! That is dumb. Others have done it and become successful but, as far as risk vs reward, I would rather risk $500 on one contract with the chance to win $800-$1000. When you get those windfall profits trades that fall in your lap, you can make 200-400%. There are probably, 1,000 ways to make monies in the stockmarket. Use that one that works for you. There is no rule that says you have to trade each and every method even if you are not good at it! That would be dumb and only cause you unnecessary losses!

Can I ask you, what expiration are you trading?
Or could you tell me for what are you exactly looking, if you are buying calls and puts? How you work with time decay and theta?

Are you using also technical analysis to determine the direction?

Thanks a lot and sorry for a lot of questions

smallfil · Sep 26, 2018

chyldom said:
Can I ask you, what expiration are you trading?
Or could you tell me for what are you exactly looking, if you are buying calls and puts? How you work with time decay and theta?

Are you using also technical analysis to determine the direction?

Thanks a lot and sorry for a lot of questions

Only trading near term options as my trades last 3-10 days maximum. I do not look at the greeks as I am only in the trade a short time. Looking only for the direction the stock is headed using technical analysis. Either the trade works or it does not! If it does not, I look to exit and save the residual value of those options for the next trade. You are not going to win 100% even if you thoroughly, analyze the trade. I work on the assumption that I will lose 60% of the time and win only 40% of the time. That is enough. What matters is the size of the winners should be multiples of the size of the losers. Small losses should not bother you. Big losses will eat any profits you earn in other trades! That matters more!

chyldom · Sep 27, 2018

smallfil said:
Only trading near term options as my trades last 3-10 days maximum. I do not look at the greeks as I am only in the trade a short time. Looking only for the direction the stock is headed using technical analysis. Either the trade works or it does not! If it does not, I look to exit and save the residual value of those options for the next trade. You are not going to win 100% even if you thoroughly, analyze the trade. I work on the assumption that I will lose 60% of the time and win only 40% of the time. That is enough. What matters is the size of the winners should be multiples of the size of the losers. Small losses should not bother you. Big losses will eat any profits you earn in other trades! That matters more!

So you are not afraid of time decay? Or for example if I want to go CALL on NKE 82 expiration 8 days, my BE will be at about 84,50 -

smallfil said:
Only trading near term options as my trades last 3-10 days maximum. I do not look at the greeks as I am only in the trade a short time. Looking only for the direction the stock is headed using technical analysis. Either the trade works or it does not! If it does not, I look to exit and save the residual value of those options for the next trade. You are not going to win 100% even if you thoroughly, analyze the trade. I work on the assumption that I will lose 60% of the time and win only 40% of the time. That is enough. What matters is the size of the winners should be multiples of the size of the losers. Small losses should not bother you. Big losses will eat any profits you earn in other trades! That matters more!

So basically you are not looking on a time decay, you just expect big move and you are looking only for big moves, right? What about your money managment? Is t still the same even after few losses? Thanks

smallfil · Sep 27, 2018

chyldom said:
So you are not afraid of time decay? Or for example if I want to go CALL on NKE 82 expiration 8 days, my BE will be at about 84,50 -

So basically you are not looking on a time decay, you just expect big move and you are looking only for big moves, right? What about your money managment? Is t still the same even after few losses? Thanks

Money management does not change. You take the same risk on each and every trade. Treat each trade as a single independent event. Whether it works or not does not matter as long as you have large wins to offset those small losses. Keep your losses small. If you are wrong, close out the trade. You are not going to get big moves each day. However, you can get multiple days going your way. Enough to give you decent profits. I would say 50% or more profits on your trades over a span of 3-10 days would be decent profits. Other times, you will only get small profits of 10% or small losses of 10-20%. Some days, you get windfall profits that just fall your way. In those days, you can make 200-400% trading options directionally. If you trade stocks, expect to get less because you do not have leverage.