Discussion Forum

Earlier today- the trade hit 12 (30, and 14×3) as vol picked up a bit-we can book this as a winner methinks-sorry I missed a chance to screenshot

https://seekingalpha.com/article/4115801-can-hold-market-long?auth_param=1e747s:1cuup15:80f7e266c45fd1b3b4c23af299dfbb0e&uprof=44&dr=1

The F has gone absolutely nowhere for well over a month now-this is like nothing I have seen -but perhaps my memory fails me. Stand by for some earth shattering event-something has to give….or does it?

It made a modest profit and even doing nothing was an option(excuse the pun).

The strangle is losing money already- the market has stopped being a market so we might take a 50% loss on this. I am no longer able to assess market conditions as none exist in the proper sense.

I would not expect this trade to do very much but any big move would see it make a healthy profit. Now most of the hedge funds have shut up shop as there are no more dips. We just have long only funds pounding the index higher day after day-while real earnings are almost mythical, inflation- predicated on wage increases is nothing. Debt is more than it was in 2008- both government and personal -any return to realistic interest rates will kill the global economy faster than you can say “Despot”

close of play on friday the 7650 call= 4.5 and 7350 put =3.5- this was really not a trade to sit on. However- next week may be fun as it’s the 30th anniversary of the ’87 crash-which means nothing other than so many traders have never known a serious market event-the heavy bias to the long side rest solely on free money-and sometimes the money tree hits a lean spot

curiously this trade could be closed out for a credit of 2.5 after getting a credit to open it. You’d need a hefty account to make this pay though.

Interesting percentage chart!

Same here…short like crazy!

I’m short this market but low volatility makes is too horrible to sell anything with downside risk as vol WILL explode at some point

I don’t have the numbers with me but …this trade bought for 19, was a close today at 35.
that’s 84% profit in old money, and the trade is still young. This is where you could close out part/ some, or all of the trade-the permutations are many.

Not sure how this will go,and maybe it’s all a bit hurried as time has not been on my side lately- that is by choice, there is life outside the markets.
I was told about this at a trading seminar courtesy of London Trading Group: ‘only 1% of people offering trading course in the US had a track record’. We have a track record you can see for yourself-we are free and offer nothing but a passion for options.

Sorry a financial crisis is not funny but Ed Balls certainly is! Amazing how failed politicians who have cost their nations so much have the temerity to carry on. Imagine we’d traded the country’s gold reserves and lost the lot,…. oh wait

It looks like the market is going nowhere so one choice with this trade which is now losing money, is to swap around and convert it into a regular ratio back spread. How? I hear you ask. We have to buy back the short put- 7250 currently trading for 42.5, and sell 4(four) 7050 puts at 4×14= 56.A credit of 13.5.We have doubled our trade size but margin is unlikely to be an issue. So we are now long at 7150 x2, short at 7050×4, which gives us risk at 6950. This is 350 points below the market, which is almost 5%. Nothing seems to phase this market, from war to crises to valuations. Everything is a bubble now.
Another choice might be to double up on this trade which is now worth about 3. We paid 7.5 initially so if we doubled our stake our aggregate prices is now (7.5+3)/2=5.25.
But which is best????

Sometimes we have to take debit trades, as the reverse of this trade would make no sense.

The market continues to frustrate, to delight, to give us hours of musings. It’s important not to lose sight of what it is- a bunch of opinions. Nothing more. HSBC is the biggest component by marketcap of FTSE-how many failed loan accounts are on its books? Nobody knows.

[…] Previous week’s Trade 47– sold a put to buy a call butterfly – closed out early for profit 17.http://optionsinvesting.co.uk/trade-47-3rd-friday-month/ […]

Another way to summarise- to open the trade was a credit of 1 and to close it (12-4) a credit of 8. Happy days

The butterfly is now 12,( paid 7,sold that cheeky 6600 put for 8= credit of 1) but with that short put trading at 4, we make 5 from the butterfly and 4 from the put=9. Or… a very very respectable return of£90 on margin of probably <£1,000. I think we can book a winner but the 'fly can run to expiry to claim that max 100. We'll keep an eye on it

I’ll run with a CALL debit spread, with volatility being so low! If it goes wrong, there is an option to repair by adding a ratio and converting it to a butterfly.

We have had a decent drop of 2.5% but still there is no fear, so like you suggested it is probably pure £ adjustment.

at expiry this made 53.5. We could keep the long spread or just close out leaving us free to trade something else. No problem having multiple positions though,and optimising your margin.

ANOTHER WINNER- A VERY ACCEPTABLE 17 FOR THE BUTTERFLY MINUS 3 FOR THE SHORT PUTS GIVES YOU A PROFIT OF 14 IN 2 HOURS OF MARKET ACTION. YOU’D HAVE TO BE MAD TO IGNORE OPTIONS-AFTER ALL THE MARKET HAS NO IDEA WHERE IT’S GOING,SO HOW CAN ANYONE ELSE?
THOSE PRICES -LONG 7400CALL AT 42, SHORT 2X 7450 CALLS AT 14.5, LONG THE 7500CALL AT 4= 17(MINUS 3 FOR THE SHORT 7200 PUT)=14.
THAT IS £140 PER LOT ON MARGIN OF SAY £1,000. SO A 10 LOT WOULD GIVE YOU £1,400. ONE OF THESE EACH EXPIRY WOULD DO, LEAVING YOU 3 OTHER TRADES FOR THE MONTH. FOREX? THOSE GUYS ARE STILL CRYING ABOUT THE ONE THEY MISSED

Again a trade I’m not over the Moon about but we have to take a position,and if it goes horribly wrong,we’ll fix it.

I took the trade- selling naked 7550 calls but do NOT recommend this for everyone. I have a small losing position in puts that may be turned around- N Korea seems to do the mad stuff at weekends

To add I would say only form of investing where we could insure our investments..unlike property or pure value investing in shares.

hope the calcualtions are clear enough for people to understand- I have done the end result based on the logic of owning the 7300,then short the 7200 and the 3 sept 7000 puts-I have thus sold a total of 4 puts for every one that I bought. Any mistakes in the calcs are due to ineptitude

Sorry but that looks like a bunch of dustbins strapped together-missile? Big is not better

Super trade!!! Did someone just make $$$..please share the love 🙂

[…] We have shown over the last 40 + trades, how, with a modest understanding of options strategies you can generate great returns. From ups AND downs. We  demonstrate how we comfortably limit risk. http://optionsinvesting.co.uk/basics-revisited-take-time-change-world/ […]

If anyone is curious about the chart and the way the price respects the longer moving average after the golden cross. It’s the magical 62. Remember 61.8 is the big Fibonacci number-the Golden Ratio……. Just sayin’ This is not a tip or even a hint, it’s coincidental as I usually work off a 5 minute chart and this is a 30 minute

Trying to draw attention to the power of options trading has often got me into trouble with the cynics and the blinkered, who are sure everyone is out to scam them.
Pensioners are scammed in so many ways- the fitted kitchen and bathroom trade spring to mind, as so many pay thousands for substandard work. Preying on the ‘well off’ older folk is rich pickings-as care homes charge £5,000 a month for very little, in my opinion.
Yes this is a mission to educate, and wake up the somnambulant. Perhaps when people see how options work they will start to challenge and question in other areas of their lives too.
We hope the knock on effects of optionsinvesting.co.uk are to the good of our subscribers.Options are NOT for everyone but financial ignorance is not an option in our world. If your IFA cannot explain options,how can they be fit to sell some off the shelf product?

Of course the market can go below 6550- let’s see,and if it does the volatility will give us plenty of juice to adjust/ roll out. This is what we hope for,to show the flexibility of options in the exit as well as the entry. and it is of course no problem to ‘leg in’ and out of any part of the position.

Another rant about ETFs which may be great for retail investors but they flatten market moves,and fail to engage.
Much is made of algo trading-most NYSE stock trades are electronic. Black boxes work, like drum machines work- but we still like to see drummers. Although a black box turns up to work on time and sober and doesn’t try to chat up other people’s partners! I think we’ll see some volatility next week-just sayin’……..that’s not advice, probably wishful thinking

To close? Nah it’s flat- a curious week and Trump antics continue apace- I see a bit of a Trump dump next week so I have no positions currently. Expiry was just ..7320, untypical as there is nearly always a rise for the auction at 10

Well-early days but the trade has done very little and again vol has been sucked out of the market- no easy trading here,we need to be patient.

Pretty much this what I did for this month..worked wonders!!

LOL!!! Cannot believe the amazing outcomes we keep having with these trades-and of course it is easy to verify these.
Our site is free and dedicated to the would be options trader who can see past the rubbish offered by so many vendors of products that maybe had a winning trade once or twice,allegedly

so now the put trade is worth about 20, the calls- cannot get prices but likely a break even,and a wake up- do not trade when ill!

comment on Trade 41 has been added though it mysteriosuly disappeared from earlier. I may be going nuts!

Thought I’d commented already on these- the put BWB has come back to small profit,now about 16,buy price was 10.5
The calls- a modest loss of about 40- could be mitigatedwith a strangle with only 8 days to expiry and biiig theta.

Combo combo combo combo…. thank you very much
today the call was trading at 6, and the put at 19. A very respectable 13.
Of course the dumb money kept piling in until it didn’t.
I’m still looking for a smart way out of trade 41- the ill chosen call broken wing butterfly.

I have been unwell again and so Trade 41 was against any kind of judgement! I was unable to monitor positions this week but the Broken Wing Butterfly is a trade with little merit for me. It’s an object lesson in why we don’t trade when ill.
Even looking back at what might have worked with calls is a thankless task- the 7400/7500/7700 would have cost 12 and as of Friday’s close…. credit of 32.
Easy to be right in retrospect. I would always favour the butterfly which cannot cause losses beyond the premium paid. With 100 point wide strikes with the BWB you can of course lose another 100

A Winner! Yay, vol kicked up a little but the market drop was the key, on Friday. Yes, we’d close out for a nice 25%

I tend to read some ‘parallel’ topics as trading material is tedious and I have read pretty much all there has been on options. Just finished ‘Scarcity’ By Sendhil Mullainathan, Eldar Shafir. A worthy read which makes plain some of our shortcomings in understanding the actions and inactions of others.

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Not a great trade as there is little basis to take it other than to contiune to demonstrate the power and flexibility of options. Should the market smash up we will lose, not a huge amount but it would be annoying

there was an opportunity to close this out for 4 this week but that is not what we are looking for -this is a fun trade -we want to win big or just let it fade into oblivion

It is hoped that our followers will understand that trade selection is the key. People who trade direction only have to choose up or down. The gift of options is the wide range of possibilities -no need to be directional,often no need to be right either.

Could now be closed out for 5- 4.5% profit in under a week. The little guys can win little and often