Calls NOT Puts!
Well,hindsight is 20:20 vision but my own biasto the downside has again proven to be folly. I will not dwell on my lack of ability as a trader- we are here to educate.
So the trade was a big old put Condor:
7250Put=127.5 now 67
7150Put=78.5 now 37
7050Put=48.0 now 25
6950Put=30.5.now 10
So we went from a debit of 32 to the trade now valued at 20. Three choices -stick with it, add to it, close out and take the loss
But, that’s not all-
as they say in those old daytime TV commercials
Here’s the call Condor that I am embarrassed to admit to:
7150Call=100 now 139.5
7250Call=49 now 69.5
7350Call=19.5 Now25.5
7450Call=6.5 now 7.5
Cost to enter? 38 now worth 52. Profit 37%.Easy with hindsight.
Strategy versus Naked
Look how you’d have done if you’d taken the Call or Put Condor compared to the naked options. The most obvious is that buying OTM calls is rarely a good idea, and deep ITM options move almost like the underlying.
Caveat
The trades here are for education and are based on Friday’s closing prices so it is sincerely hoped that nobody is following. There are people who give trade tips. Not us. We educate and show real practical examples. We hope that we can show that options trading is smarter, less risky, and potentially more profitable in the long term than anything else. Of course the prices will be variable based on the examples but we know you can get better entries and exits when you place limit orders. We welcome challenges to what we are doing as our knowledge comes from years of retail trading. We have no floor trading experience, or the big bucks of the trading houses, for research. You should be the journeymen, taking a step closer to financial control every week. Enjoy.
