I am well aware of how options works at least to my knowledge in terms of price action influencing the bid-ask spread and what it means as the spreads gets wider while factoring in the number of contracts opened. It definitely adds up rapidly in terms of slippage if you are not careful.
Quit Corporate Job to become Options Trader Full-Time. Need Professional Advice.
- Thread starter MarksmanII
- Start date
MarksmanII
You seem fully determined to go into trading no matter what.
Few suggestions - remember this is just one opinion on an internet forum.
* Whenever you can, and I'd say as early as possible, get yourself
through the 10 days www.dhamma.org : it is basically like 10 years
of psychotherapy done in 10 days. Before, you might want to discuss with
a psy ( 1 or 2 hrs session) about the negative things you went through
your jobs, as well as the failed business partnership.
when there : follow the instructions to the letter, for maximum benefits of
your 10 days
* After the 10 days : get a list of everything that will make you successful
in trading. On these, highlight those you are convinced then you can do.
You seem fully determined to go into trading no matter what.
Few suggestions - remember this is just one opinion on an internet forum.
* Whenever you can, and I'd say as early as possible, get yourself
through the 10 days www.dhamma.org : it is basically like 10 years
of psychotherapy done in 10 days. Before, you might want to discuss with
a psy ( 1 or 2 hrs session) about the negative things you went through
your jobs, as well as the failed business partnership.
when there : follow the instructions to the letter, for maximum benefits of
your 10 days
* After the 10 days : get a list of everything that will make you successful
in trading. On these, highlight those you are convinced then you can do.
Not even close. The game that the professional/marketmakers are playing is completely different.
Are you planning on being delta neutral or are these just tosses of the dice?
I can apply for margin account and put on verticals spread which helps reduce the cost of opening trades + limited profit/loss, but that would limit the number of trades I can put on in a week. So I'll stick with cash account, I will mostly be making long calls,puts, straddle. Straddles won't be worth it unless I can determine if the move can be very large to negate the cost of opening straddle, or else I will just be breaking even. Mostly right now I want to be very selective in entries and waiting for catalysts in the market before making a move, I don't want to get whipsawed by small movements. I know how hard it is to get out a position without loss, once you enter a trade with a large bid-ask spread, average I can easily blow between $15 - $40 PER contract.
I'm setting max 2-3% risk capital per trade, so hopefully I don't blow up as fast, even then it won't mean I'll purposely let myself lose 100% on the 2% of the trade. The only silent rapid killers are the fast reversals going against my positions.
Just a reminder, I have traded options for around 6 months, but I would say in the last 2-3 month I actually put in a lot of effort to understand it more. Now that I just started my experiment putting in 100% of my time and effort, today would be the 6th day out of 3-4 months. I feel I have enough time to cover the basis, before I start using real money again. Only time will tell if I am able to continue to do this down the line.
I'm setting max 2-3% risk capital per trade, so hopefully I don't blow up as fast, even then it won't mean I'll purposely let myself lose 100% on the 2% of the trade. The only silent rapid killers are the fast reversals going against my positions.
Just a reminder, I have traded options for around 6 months, but I would say in the last 2-3 month I actually put in a lot of effort to understand it more. Now that I just started my experiment putting in 100% of my time and effort, today would be the 6th day out of 3-4 months. I feel I have enough time to cover the basis, before I start using real money again. Only time will tell if I am able to continue to do this down the line.
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With the amount of money you have, I'd be trading long straddles 1 or 2 days into earnings, and exit when the announcement is out. This way you can control your losses. Profits will come, just concentrate on managing your losses. If you're serious, make sure you understand implied volatility inside and out and how to analyze it. Make sure you know what you're looking at.
Long vanilla calls or puts is just too difficult unless you really know something the rest of us don't. However, if that is your forte, have a realistic exit strategy before you trade.
I had bosses from hell, and those memories keep me grounded and I can't think of anything I'd rather do than trade from the comfort of my own home.
Good luck!
Long vanilla calls or puts is just too difficult unless you really know something the rest of us don't. However, if that is your forte, have a realistic exit strategy before you trade.
I had bosses from hell, and those memories keep me grounded and I can't think of anything I'd rather do than trade from the comfort of my own home.
Good luck!
The active strategy that is feasible within an intraday timeframe is market making.
Why can't he trade a time frame that doesn't require a full time committment? Does his strategy require very broad diversification that it takes up so much time in position management and analysis?
If he was going full time as a Futures scalper, I would say: Why not? But, to do it as an options trader with $10K is insanity. Stop enabling to this guy.
Why can't he trade a time frame that doesn't require a full time committment? Does his strategy require very broad diversification that it takes up so much time in position management and analysis?
If he was going full time as a Futures scalper, I would say: Why not? But, to do it as an options trader with $10K is insanity. Stop enabling to this guy.
I gave my $0.02. Others are selling the dream...even though they should know better.
with 10k you can trade stocks on margin with IB , why options?
I remember telling my wife after about 3 years of trading options that I was going to quit my job and do this "full-time". Luckily I took a huge loss before I could type up my resignation and go through with it. The people on here are telling you the truth as hard as it is to believe. There is no book or online course that is going to give you the skills to beat out the professionals. Remember, we all think that because we have passion about trading and we spend all of our time thinking about it that we can be successful where 90+% of others can't. You are competing against billions of dollars backed by some of the smartest people in the world. Spend a few years trading part time and figure out what your niche is. The good news is that you can be successful and what you will find is that it wasn't anything like you first thought it would be.