Swingtrading with options

[Overnight]

It's low freq. I've traded 7-figure positions on my iPad.

Anyone of us can trade 10-figure positions on our left gonad if it had a reflective viewscreen on the sack. It's all about our comfort zones. You like i-Pads? Fine, it works for you. I want monster screens and desktops. When I get to be like that e-trade dumb teen, I'll think about Apple products, because then maybe I can afford them.

(And by the way, what is up with your profile pic? Did you change it recently? I do not recall it looking like Kevin Bacon on the set of a Mad-Max remake.)

 

[destriero]

AH hahaha. That was taken at the con-agency in Barranquilla when I was at State. It was significant as it was the last pic taken (pre digital) before I got really (physically) f*cked up. Short hair now.

 

[trader1974]

Trade Futures and hedge it.

Why?

 

[destriero]

(And by the way, what is up with your profile pic? Did you change it recently? I do not recall it looking like Kevin Bacon on the set of a Mad-Max remake.)

I got so much ass in Colombia that I'd need to use scientific notation to express it. =)

 

[misterkel]

I have experience with futures but not with options. I see 2 advantages: I can use more leverage and sleep more calmly if I buy calls instead of the future. Disadvantage: I lose the premium, the movement must be broad to be profitable. Anyone who does this type of trading can advise me?

Trade call spreads. You take on 1:1 risk for canceling premium, but it's a way to cancel premium.

 

[ironchef]

OK, got it.

Say you're bullish XYZ and vol is high. You could take an outright but you're concerned about being stopped out. So you go long spot at 125 and give it some time, intraday. Spot rallies to 128 near the close and you're intent on holding it but the index takes a shit.

You short 2x the 140C and how you're short the (synthetic) straddle. Now you're looking at a 140 target and (strips) vols will inevitably drop if we rally across the board. You're up on the position as the call short was an opportunity gain (gained on shares and calls rallied). You've extended the position to the expiration on vol (potentially) and ostensibly can earn more from the vol-position than the outright share purchase, while reducing your deltas.

Or any time you're up on marks and you don't have the net liq to support the position (going from 4x to 2x overnight). You're long and you buy a garbage put and now you're long the synthetic call. No more variation margin.

My head is spinning, stomach churning. I need an aspirin.

 

[Pkay]

Long calls or puts can work for you IF you have a very strong system for the underlying that consistently delivers big gains short term, and if you have strong volume with tight spreads.

Otherwise, you'll just bleed your account.

Would you be looking at buying OTM calls with at least 90 DTE.

 

[Pkay]

I buy naked options all the time. I don't see why buying naked futures is problematic. But I don't trade futures, so I am speaking from complete ignorance, even more so than normal.

When you say buy naked options do you mean buying calls and puts?

If so, what is the strategy that you use? I'm thinking of buying calls on stocks I think will make a decent move up. The idea is to buy a slightly OTM option with at least 90 DTE.

 

[.sigma]

When you say buy naked options do you mean buying calls and puts?

If so, what is the strategy that you use? I'm thinking of buying calls on stocks I think will make a decent move up. The idea is to buy a slightly OTM option with at least 90 DTE.

I'm curious why 90 DTE?

I would never buy premo with that much theta, unless I'm hedging something.

But yes that's what he means, buying calls/puts, depending on you, you either buy ITM/ATM/OTM, overall ATM is your best bet, but even better might be verticalizing that naked call/put into a debit vertical spread.

 

[CannonTrading_Ilan]

Is it better than with futures?

I would probably use futures with options as risk mgmt.
Example going short gold while buying a call option rather than a stop and possibly selling a put if the market goes my way nicely enough. No perfect solution and each method has + and -