Gentlemen
I´m overwhelmed by your kindness. I appreciate it. This is so unusual on these forums.
I will try the expiry STRADDLE in paper money.
As to the reasons for the failures. Yes I know the reasons.
Credit spreads rely on making money by compounding. But when the market dips violently, your losses by several reasons, tend to almost wipe you out. I hate to make it over months and then give it back in a couple of days. Howard Cohadas website on credit spreads covers the reasons by other experts, to which I attest. Discarded credit spreads as a result.
Gap Trading was very lucrative with 4 months of funny money trading. Made 297% in four months. But when I opened a $10,000 cash account, I won the first trade, but lost the next three, which has put me down 30% of cash account. So now I must put it aside for now, though I know the error. The error was not using a Limit order and using a market order to enter. Precalculating the entry and either getting it, or being skipped over. It was like fishing for tuna. You catch the first one, then every other tuna you catch, all you have is heads on your line and hook, to pull in. The bloody sharks had come running and chomped me up. They simply took my market entry order and left it too last and gave me the high of the day in the opening surge. I´ll go back to it, when I can afford it again, if ever. The way I was doing it was compounding also, so when the sharkes bite, it took all the meat I could afford.
I´m not sure what is happening on the straight buy and sell in funny money, but lately I have been unable to make bets on the right side of the market. Betting by using indicators seems not to e a good way. Hence my search for something else.
Why the long straddle? Well I knew a guy in South Miami did very well at it. Started his own brokerage, started his own bank and both himself and his wife traded long straddles. I never found out what he was doing, just got titillated by my discount broker at the time over the phone. That was a long time ago and learning option stuff was difficult back then. I was trading stocks successfully, but so slow and small, I got tired of it and quit everything and did something else. Lucked out and now I´m old and wondering if I can figure out something now. I´ve probably got $2,500 left of my stake I´m willing to risk and unlike 25 years ago, there are lots of information and charts available. Stocks are too slow. Options are quicker. I like that.
So I find myself doing long straddles in paper money. To see what happens. The same month comment is very well taken. I am using second month options, for what are 5 day moves. Don´t know how this will work out over time yet. Need a few more weeks. I am thinking though perhaps LEAP options might be the right way to trade Long Straddles. Might try it later. I´ve looked them up on the internet, but nobody is writing anything about successful long straddle methods, but there must be one or two out there? All I can pull up is the standard pap on a long straddle, but obviously there are other ways of using them to make money. The method I am trying is a mathematical type way, not much thinking to do. I´ve got it figured to run about a 5 day trade. Doesn´t matter which way the market goes. I like that. Will know by the end of the month I think.
Again, I wouild like to thankyou guys for your gracious contributions. I didn´t expect it, having been on a couple of other forums. Like a breath of fresh air.
