Roll Call: Options traders

metooxx · Jul 16, 2003

Quote from Fast_Trader:

Kicking, I haven't experienced any problems getting filled. Just make sure there is enough open interest. And yes, these are strictly long positions (yesterday's trade was a long PUT option).

-FastTrader

Open interest has nothing to do with getting filled ...

hardrock375 · Jul 16, 2003

Quote from metooxx:

Open interest has nothing to do with getting filled ...

How about theoretical edge, or lack thereof?

metooxx · Jul 16, 2003

Quote from hardrock375:

How about theoretical edge, or lack thereof?

The only things that should affect a fill are locked (in some cases), crossed (most of the time), below parity (sometimes), fast markets (the kiss of death) ...

EMini-Player · Jul 17, 2003

Quote from metooxx:

Open interest has nothing to do with getting filled ...

Yes, but it makes me feel better knowing there are other fools out there holding the same contract as me

j/k

-FastTrader

lindq · Jul 17, 2003

Quote from Kicking:

I am tempted to swing/position trade stocks with outright options too,

Don't be tempted. As a special play now and then, okay. But on any kind of a regular program you will get chewed up with spreads and decay. Been there, done that. If you have a successful swing system, stick with stocks or SSFs.

DblArrow · Jul 17, 2003

I have just started the option scene. However on the sell side. Been waiting till about a week and a half before expiration, and using the same analysis I do for my day trading, get an idea of the direction on the daily and sell puts or calls. Have done a couple covered, but mostly naked.

i.e. Just after SONS hit its high, along with a bunch of other stuff, I sold the max number of calls that my account would allow. Didn't have much wiggle room but was convinced it was going down. Of course had an exit point should it have gone back up, but all my stuff told me it was not. And I am actually up more than had I just sold the stock short (using my account size and trading the max shares). True it could continue down but by the end of tommorrow It will be on to another trade.

Make 'em pretty, Chris

lindq · Jul 18, 2003

Quote from DblArrow:

I have just started the option scene.
I sold the max number of calls that my account would allow.

If you continue to sell naked, you will have a short trading career. The few premies you gain from the strategy will look like a joke when the underlying moves against you. If you came out ahead this time with naked calls, consider yourself lucky in a falling market, and leave the strategy behind. If you can pick stocks and forecast movement, you are far, far better off in the long run with the stock or an SSF. Trust me.

DblArrow · Jul 18, 2003

Quote from lindq:

If you continue to sell naked, you will have a short trading career. The few premies you gain from the strategy will look like a joke when the underlying moves against you. If you came out ahead this time with naked calls, consider yourself lucky in a falling market, and leave the strategy behind. If you can pick stocks and forecast movement, you are far, far better off in the long run with the stock or an SSF. Trust me. [/QUOTE

lindq - I appreciate your advice of caution - but I do not consider myself lucky, I considered it a trade that worked based on the analysis that I did. It has now worked 3 times out of 3. I know that it will not always work and I realize that I will have losers.

Some of us are boneheaded and must learn the hard way. As with anything the risk must be evaluatad and ACCEPTED.

As I stated I am new to stock options, so please indulge my lack of understanding. I do not quite understand why, if one can make decision on market direction, that trading the stock or SSf would be better. It took me a long time and a lot of math to figure this play would have been better than a simple short. (I am often slow).

I do however understand and ACCEPT the theoretical and potential and possible risk of naked calls as I said above.

Thanks, and Make 'em pretty, Chris

PS. All the above said I am simply and bond and note trader, not a stock trader, looking to add to my knowledge base.

lindq · Jul 18, 2003

Quote from DblArrow:

Quote from lindq:

I do however understand and ACCEPT the theoretical and potential and possible risk of naked calls as I said above.

More...

If you truly understood the risk of naked calls, you would not touch them. I am trying to do you a favor here, based on my extensive experience in options strategies, and the advice of virtually any honest broker you care to speak with.

If you feel that you need to prove something to yourself and continue to sell naked, then at least trade a minimum number of contracts until you get your ass handed to you and comprehend the reality of the risk. If you approach anything near your "account maximum", as you said, then you are at real risk of catastrophic losses.

I don't have the interest in engaging in a long explanation of why this is the case, other than to point out that any strategy that offers unlimited risk with very limted reward is a fools game. The first time a stock moves against your leveraged position, you will understand.

iceman1 · Jul 18, 2003

Quote from Fast_Trader:

Just want to see who else is trading options. I'm just getting my feet wet. Traded 1 contract last week; return was over 30%.

Then found another opportunity yesterday. Paper-traded 10 contracts. By today, ROI would be over 200% :eek:

The money is not the greatest unless you're doing larger size, but the percentage returns are amazing! Just want to see how many other option traders we have here on ET.

-FastTrader

Y, trade options...

what kind of trades are you considering ?

Ice