Stock market.... What are you doing?

[CHCRandy]

I regret having bought long into some companies I wanted to sell options on

Why? Did you buy the stock just to sell covered calls and stock fall? I know why they call these things options....lol, it gives us too many options.

 

[hoosierdoc]

Why? Did you buy the stock just to sell covered calls and stock fall? I know why they call these things options....lol, it gives us too many options.

hah, yes they do. I bought long to sell options. KODK is probably too risky. I have quite a few naked puts also. I will probably back off on those next round and close some for profit Monday.

I'm nervous my success is luck and timing more than picking correctly. watching a lot of YT videos on delta, gamma, theta

 

[CHCRandy]

hah, yes they do. I bought long to sell options. KODK is probably too risky. I have quite a few naked puts also. I will probably back off on those next round and close some for profit Monday.

I'm nervous my success is luck and timing more than picking correctly. watching a lot of YT videos on delta, gamma, theta

I got a buddy of mine who is trying to teach me a new system. He sells naked puts, only a week out from expiration. He will find high implied volatility options and buy them on Friday, only weekly ones, then he said the decay will kill the value of the puts come Monday - Friday following week. I am still a little nervous of selling naked.

I just need to stay small. As much as I would like to have 10-20 options orders open a time, I just can't do it. It gets too complicated to keep up with.

I did learn that I can use a trailstop on options....that seems to help me out. Best of luck to you.

 

[nonobaddog]

How much time does one typically spend watching and checking on an option order? I don't want to get into something I have to babysit all the time.
Is it different for different types of options? Does it take very little time for covered calls?

 

[hoosierdoc]

i think you can set limit orders and then just let it ride if you want. you can certainly day trade them, but if you set a limit order for max loss you're comfortable with and choose a share price and time frame you'd be happy getting out of the deal at, then just follow share price and close when you want.

I am looking at candle sticks, moving averages, and trends.

look at FSLY. I think based on 20-day moving average it's headed back to 92. I could do a vertical.

if i wanted to play it as a vertical to limit risk, would i do a FSLY Jan 8 +97p, -90p for $3 per contract? and if it goes to 92 in 3 days, presumably the $5 i spent to buy the 97 put would now be worth $7.50ish (delta -0.45 and theta -0.17), and the 90p now worth $3.40 (delta -0.25, theta -0.17) or so? that would be a $1.10 return in 3 days on $7 collateral, or 1900% annual return?

did I analyze that correctly?

 

[nonobaddog]

i think you can set limit orders and then just let it ride if you want. you can certainly day trade them, but if you set a limit order for max loss you're comfortable with and choose a share price and time frame you'd be happy getting out of the deal at, then just follow share price and close when you want.

I am looking at candle sticks, moving averages, and trends.

look at FSLY. I think based on 20-day moving average it's headed back to 92. I could do a vertical.

if i wanted to play it as a vertical to limit risk, would i do a FSLY Jan 8 +97p, -90p for $3 per contract? and if it goes to 92 in 3 days, presumably the $5 i spent to buy the 97 put would now be worth $7.50ish (delta -0.45 and theta -0.17), and the 90p now worth $3.40 (delta -0.25, theta -0.17) or so? that would be a $1.10 return in 3 days on $7 collateral, or 1900% annual return?

did I analyze that correctly?

Amazing.

If you just repeat that every 3 days where you turn $7 into $8.10 for 15.7143% gain you would make $133.83 in a year for about 1900% return, just like you said.

But now if you could compound that and add the dollars gained into the investment each time you would hit $1Million in about 244 days and hit about 1Million percent gain in about 292 days. At the end of a year you would have hundreds of $Millions. (unless, of course, I did something wrong)

 

[hoosierdoc]

the risk is stock goes up and you lose money. if you guess correctly it can pay well with limited risk though. if you think it's going up you could reverse the buy/sell puts and do bullish naked puts with protection, a "bull put spread". you lose profit potential but gain a limit on losses

AMD calls are paying about 4%/month right now if you sell 4-5 above current trading price. could probably get 40%/annual return with a fairly stable company

 

[hoosierdoc]

I have been looking at candlesticks and using them to predict market trends. It's hard because you're backtesting it when you look at historical graphs. "oh yeah, it did that because of this thing here". Is that true? Or are you just describing what you see? I am going to make some predictions for next week. Market closed 1/1 but here are some guesses based on what I saw with the candlestick charts. I'll post publicly to see how I do. If you want to do investing more than just mutual funds and overall markets, I highly recommend learning candlestick and trend interpretation. Can't believe I have never looked at this. Most of these would be losses for me. I'm planning to sell KODK and XOM right now as I think both have huge downside potential and I'm in the money on the KODK call I sold.

Let's see how I do

XOM 41.6 ->39.50
AMD 91.54 -> 98
FSLY 97.49-> 87
BE 30.49->33
AAL 15.66 -> 14.75
TRVN 2.29 -> 2.10
VXRT 6.80-> 6.40



[video=youtube;C3KRwfj9F8Q]https://www.youtube.com/watch?v=C3KRwfj9F8Q&t=5s[/video]

 

[hoosierdoc]

did the site change really wipe the last few days of posts here?

 

[hoosierdoc]

i am loving options trading. Trying to work into covered calls on solid companies more than just playing volatility.

I got $155 in dividend from USOI. I own 1270 shares in my IRA. That's not a bad return every month

 

[muncie21]

For those asking about 'covered' versus 'naked', as long as you are 'buying' the call/put, your loss is fixed. I.e. limited risk.

It is when you start 'selling' either puts or calls that your risk become more uncertain.

Moral of the story, buy all the calls/puts you want, you can't lose more than the purchase price. I have found that the value is in learning (even when losing money) how options pricing, expiration, selling strategies, etc. work.

 

[NKBJ]

I'm getting tips from that shoe shine boy on the corner of Rector Street.

 

[BugI02]

I held a 60/40 fund at Vanguard that returned a little over 16% as well as 3% dividends and interest ytd, and I had to buy and sell nothing nor engage in any market timing - and it cost me 0.07% expense ratio

 

[CHCRandy]

I just traded mostly NRZ all week. Made about 2-3 dividends on it this week, lol. I only trade around 6-8K shares of this at a time. I think I may sell it next week and go all options on it, since the divy is paid now. Not sure whether I want Feb or May's.....been waiting hoping someone writes some March or April options. I love the stock, but I see no reason to hold the shares now until March or so, other than IPO and ER news. I should be able to make just as much on calls if it pops, and I can use the funds I had in the shares to do other deals and deleverage myself. It will pop though with IPO news.

Bought DGLY shares this week.....plan to sell covered calls on it, although I may abort that trade. Not really liking how it acted this week.

Added more TRVN, still have not sold calls....since it crapped out this week.

Started new play today, selling naked puts on CALA, $5 Jan expires for $1.10+....as long as it holds resistance I will add more. Plan to do the wheel on this. Looking at 25-50 contracts. 25 would be $2750+ profit on $12.5K investment if it expires over $5 in 10 days...if not I own shares at $4 or less and sell the covered Feb calls for $1.50+, to get a $2.50 ACB, just keep rolling month to month. I will do more DD on this company over the weekend.

I ended this year up less than 40%. Really disappointing. I screwed myself when I got caught in NRZ with a large position and big loss, I am up about 100% from that low day in March. SO I feel blessed even if disappointed in my mistakes. I should have easily had a 100%+ year. I am looking to make it up in 2021, good Lord willing!

I am gonna try a new strategy or 2 this year. I have always went big in plays....I mean sometimes like 50-70% in 1 play and sell when it pops to lock quick profits. I am gonna try changing that and putting myself on like a 10-15% limit in 1 stock and have 5-7 plays max at a time, and always keep like a 3% trail stop on them. I am trying to prevent myself from taking a big hit again. The problem is if the stock drops overnight, you are still hosed.

Sorry to ramble. Happy New Years guys and gals.

 

[wlr2]

I play with the Stash app. I'm not a big player and just put a dollar or two in every so often. But, that being said, I've turned $600 into $2600 with Tesla and a few medical companies.