From Flat to 12.5 in 5 Minutes
Please excuse the graphic. This screenshot was taken after the open this morning and for no particular reason the call price smashed up. These trades are a real delight as you can make a week’s profits in 5 minutes. Of course you’d have held this trade over the weekend and it could have gone the other way, but there was no market moving news. One lot of this trade would thus make your 12.5x£10= £125 minus costs.
How Could You have Made This Trade in the Real World
One way to capture these quickies is to use limit or even(yikes!) market orders. A market order will give you a ‘haircut'(eat into your profits big time) but if you want ‘out’ immediately you have to take these sometimes. A limit order you can play with in small increments. At time of writing the FTSE is rallying back up to 6923, but a 1% drop and bounce back seems to be a common occurrence of late. So…… would I have taken the opposite side of the trade? No, but there may be another bite of the same cherry-selling the 6600 put for 23.5 and buying the 7150 call for 21. It’s not a well thought out trade but I have in the past made money twice in a day from the same trade-my broker thought I’d gone mad. This market suggests it is giving up profits intra day but longer term it’s anyone’s guess. We await Mr. Trump’s next market moving event.
I Allude to our Mission Statement
We will keep on with the trades, as long as our mission requires. We hope there is real value in doing these and it’s fun. But….remember this is paper trading, the prices are real, both opening and closing, so no flights of fancy. Nothing to sell.
