Discussion Forum

So, if you’d bought the spread, you could then sell the 7750 calls for 29.5 giving you a zero cost trade. The spread has increased by 6. As always with options there are choices and unlike other trading methods,there is no time pressure you DON’T HAVE TO take the trade, you can leg in, or leg out. You do have to start somewhere however, an if you’d just piled straight in with a debit of 3.5 you’d be looking at a trade now worth 6. A share trader would be thinking that’s a 70% gain! For us it’s nothing but in 2 weeks it might be worth 20 or more.

This was a Monster- making as much as >50 a month’s income in one trade.

Killer trade- th Sep puts are now 38 with the Aug ones 0.5 x3= 36.5 from an outlay of 14 plus a bit of margin. That’s got to be around 10% ROCE. We like these as the success rate is so high

Winning is not our aim- education is our core value. the power of options THAT is the key-and if people ignore options trading, or even worse, get into some nonsense scheme with forex or cryptos, they will never become profitable. Directional trading? Forget it.

to be updated

These trades hit 20 today -so we have bagged a double winner. Would we exit now? Why not a half portion? Leave the rest for speculation as a freebie

LOL- long and wrong! Well, we could take a small loss on this and close out for 6, or let it run. Looks like the BofE rate rise is anticipated- from 0.5% to 0.75% is a 50% increase- but in real terms it’s not even a bag of peanuts -another 5p a week on £1,000

Get over yourself- lazy old wotsit! Seriously- this s a strategy that is proven time and again- so let’s see. I’m really pumped with this!

Anyone remember the Sumitomo copper scandal in the 90s?

trade 84 now trading for minus 4 still early doors on this of course

well that knocked us for six! The trade is 82 to close- but let’s hang in there

YaY! We hit 214.5 -but actually we did more than this,but closing price on Monday gave us 214.5-180= 31.5 profit- or 16% -apologises I don’t have time to keep up with intra day moves sometimes. However you cut it, this is a nice win

the diligent ones among you will of course realise that trade 79 is using June expiry options

Ouch!!!!! I did NOT see that coming- here’s the outcome this week 274 176.5 x3, =529.5, 86×2=172 so we have 446 for our long calls but 529.5 for short calls= a loss of 83.5.And a debit of 2 to get into the trade….ugh!
This is our biggest loss to date and salutory lesson. Trade 78 was safe however with a tiny credit of 3.
This trade was and will remain a theoretical one as the huge market move has turned it into a very ugly position- maybe the strategyw was right but the strikes were wrong…..
More homework required,and we can backtest but this does not look like a happy outcome-though next week could get bearish…..please?

Curiously this trade now works out at zero, the 7450= 106.5,the 7550s= 45.5×3=136.5, nd the 7650s=15×2= 30. I don’t have to tell you any more…

Well, this puppy closed out for 65 last night (mon 16th)Not it seems because of impending war but because the £ rose against the US$ or some such thing!

this is a shocker- on P/E metric FTSE is hugely undervalued -extraordinary
see:https://markets.ft.com/data/indices/tearsheet/summary?s=UKX.P:FSI

great article

This trade does of course require some margin- we are buying 6 calls and selling 8

Exit IS everything remember

Well, today was interesting not sure what is moving the markets -impending war with Russia? Who knows but one thing I would have considered here-if I’d still been in this trade would be to look at morphing into a put ratio spread and maybe spending a bit to do that- but we are only day 2 into the trade. If the market looks like it’s going off a cliff we need some protection however as anaked put get get big on you in a heartbeat.
You may also wish to know I am not, by nature bullish so if forced to use these options,I’d have sold the call and bought the put- my stock in trade in 2008. This would have made a tasty 28 and acredit to open( I always seem to lose when I place a debit trade)

Could have closed out this morning in the first hour for 10- but we want to have fun don’t we? When I trade these I look for a price that I might take and then look for 30% more on entry and exit. I’d take this trade for a zero debit as also could have been done today- the F has got its knickers in a twist while the DAX continues its whirling Dervish moves

Smashed it!!!!!!! That trade could be closed out for a credit of 0.5 -That people, is £2,500 in your pocket for less than 2 days of trading. Risk was respectable,margin managed. And you want to trade bitcoin? Shares? Get with the real money

Tariffs- not a good idea especially as Chinese steel is not a problem being 2% of America’s steel imports. China’s economy is predicated on stealing copyright-and really we should just boycott all their stuff until they start to recognise that design and origination must be respected. It is the decent thing to do

sometimes trading can seem a little abstract-it’s good to remember it’s real money,and to size positions according to the size of our account. Recently margin more than doubled- you need to take care and avoid over extending yourself.

the nakeds didn’t go well- the Iron condor not great but not a disaster- plenty of time for that still!

this would have closed out a couple of days ago for almost the whole 20 credit-sweeeeeet!!

Currently the put condors are showing about 50% profit- the call condor? 40% loss.
Would you take 2 or more of these? You might end up making your broker rich while you tread water

Thanks so much for the post.Really thank you! Keep writing.

I admire anyone who succeeds but Mr. Buffett annoys the heck out of me and has had major losses yet managed by accident of birth to be in the market during the greatest ever economic expansion in the history of the universe. But he is an investor, and has had time on his side. We have to trade to generate profits,and that is a very different prospect. We need a bit more gas in the tank, more rpm than the fortunate Mr.B

It is wonderfull article
Thanks for Sharing

In my own personal trading I am underwater. As I have often said,and this is not false modesty, I’m a rubbish trader. Will the flexibility of options get me out of a hole? I hope so, but at least I was not one of these clowns who shorted VIX month after month,and now they face epic losses.
Keep it manageable,take the pain with the gains,and to quote ‘Don’t Panic’

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Hindsight is 20:20 vision we know that but we have to take trades based on Friday’s prices as they are for illustration purposes only. This trade could have been placed yesterday for a CREDIT of 20! Yes life is unfair, but you can always add to your trade.
The old adage of never add to a losing trade is the opposite for options in our experience. You take ina credit of zero and sudenly you can get 20, do it! Today the value of the trade is 7. So….even if you got a bit spooked by trade size you could take a short term view and close out the extra lots (or leave them and close out the original- a bit of humour here!)You think ETFs give you that sort of flexibility? Futures? CFDs? Options give you so much more.

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So! The 7750s are38 and the 7650 is 94-remember we sold 2 of the 7750s for every one of the7650s we own,so it’s 94-76=18. Our cost was 11-so we make 7-a 64% profit in 2 days. We can hold on for much bigger profits but a cautious trader might close out and take some money off the table by trading multiple lots.
We therefore book our first trade of 2018 as a clear winner.
Welcome to our options world-how’s your tracker fund doing?

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I’d like to say just buy the bloody market and be done-because it has really taken the wind out of our sails this last year. The few opportunities there were,(2) I missed, being such a rubbish trader. A few good trades mitigated this but I am on track to have my worst year since 2010, probably- unless FTSE expires at 7700 for Jan.

according to CQG 15k lots traded in last 15 mins…

is that reasonable volume ?

eurostoxx closed on lows tho !

should have known these ‘erberts would ramp up FTSE for end of year’s figures as there is NO volume to speak of. Hoping for reason in 2018(unlikely) and some volatility- almost certain when events overtake the dumb money’s apathy and ignorance of actual value. Meanwhile this trade has gone horribly against us- about time! We will make adjustments as and when required but this is probably going to run to expiry.

2016 and 2017 have been horrible years for traders but we have shown that when we trade smarter, with options, we can make good profits without the cold sweats and sleepless nights

Tried to place this for a credit of 2 yesterday- close but no cigar and as the calculator shows the vol is just obscenely low. One big retailer has now been caught cooking the books. H&M having a torrid time.Who else is faking it? Is this the time for the ‘credit card max out’ coming to an end? Personal debt is shocking, and unaffordable as bloated egos continue to seek comfort in buying random tat. The best gift is time, freely given. The plastic junk bought to placate, or salve a guilty conscience is an empty gesture.