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re: Options Trading Thread
Posted on 4/26/23 at 10:38 pm to bayoubengals88
Posted on 4/26/23 at 10:38 pm to bayoubengals88
Absolutely. Become well versed in and comfortable with credit spreads before getting into multi leg strategies. But with credit spreads and iron condors (which are really just two opposite credit spreads layered on one another), you’re mainly looking for underlyings that have relatively high volatility and IV percentile (which just says where the current IV is in comparison to the last 52 weeks of its implied vol) - higher, the better. Although be careful of “trash” underlyings (like most of the meme stocks from a couple of years ago) that have insanely high IVs for a reason. They’re like land mines with candy bars on top.
But this is a learning process and you’re doing fine. But do delve into IV and how the deltas work, especially around earnings time. That’ll really help you.
But this is a learning process and you’re doing fine. But do delve into IV and how the deltas work, especially around earnings time. That’ll really help you.
1
Posted on 4/27/23 at 1:10 pm to Jag_Warrior
quote:Thanks, that’s what it seemed like but wasn’t totally sure. I was going to ask here
But with credit spreads and iron condors (which are really just two opposite credit spreads layered on one another),
So if an elevated IV stock remains within the walls of an Iron Condor that’s when the most money can be made?
As opposed to a low IV stock staying between the Iron Condor..?
Posted on 4/27/23 at 1:46 pm to bayoubengals88
4 for 4 this week on 4/28s
MSFT +97.78%
AAPL +68%
ROKU +36.8%
V +23%
MSFT +97.78%
AAPL +68%
ROKU +36.8%
V +23%
Posted on 4/27/23 at 2:03 pm to bayoubengals88
quote:
So if an elevated IV stock remains within the walls of an Iron Condor that’s when the most money can be made? As opposed to a low IV stock staying between the Iron Condor..?
By golly, you’ve got it!
High IV generally means richer premiums at a given delta. Relatively high IV percentile means the probability of IV contracting is greater than with a relatively low IV percentile.
That’s why these earnings trades are so profitable. IV gets elevated and then there’s (usually) that sweet IV crush right after that deflates the short options = we make $. And sir, you’re having an excellent week.
Posted on 4/27/23 at 2:32 pm to Jag_Warrior
Good stuff. Do I even need to own equities?
Also, anyone thinking MSFT cools off a bit soon? Trying for a 5/12 credit call spread with a break even of 308.80
Also, anyone thinking MSFT cools off a bit soon? Trying for a 5/12 credit call spread with a break even of 308.80
Posted on 4/27/23 at 2:59 pm to Jag_Warrior
I've started listening to all of the tastytrade videos on YouTube after plowing through the option alpha podcasts. I will revisit the OA stuff because there is so much there, but I'm enjoying the tasty content.
For new traders (like me) this particular video hit home. This guy traded a simple strangle strategy (which can easily be converted to defined risk).
LINK
I had been playing with 0DTE SPX options but I got burned a few too many times by out kicking my coverage (knowledge). I realized I have been very profitable with my basic 30-45 DTE IC's, and everything else has cost me profits. So for now, I'm back to doing what was successful for me. As tempting as those 0-1 DTE SPX plays are, I need to focus on what works for me while building my account and experience.
Despite some of my previous strategies hurting profits, I'm still up nicely YTD which is encouraging considering the follies.
For new traders (like me) this particular video hit home. This guy traded a simple strangle strategy (which can easily be converted to defined risk).
LINK
I had been playing with 0DTE SPX options but I got burned a few too many times by out kicking my coverage (knowledge). I realized I have been very profitable with my basic 30-45 DTE IC's, and everything else has cost me profits. So for now, I'm back to doing what was successful for me. As tempting as those 0-1 DTE SPX plays are, I need to focus on what works for me while building my account and experience.
Despite some of my previous strategies hurting profits, I'm still up nicely YTD which is encouraging considering the follies.
This post was edited on 4/27/23 at 3:02 pm
Posted on 4/27/23 at 3:21 pm to dragginass
Rising star videos are fun.
I’d love to generate decent income this way.
———
Looking for INTC to stay negative after earnings.
Picked up an extremely small bearish position today on that one earlier today. The stock has generally just sucked lately.
Also, damn AMZN killed it! I was too shy on that one.
I’d love to generate decent income this way.
———
Looking for INTC to stay negative after earnings.
Picked up an extremely small bearish position today on that one earlier today. The stock has generally just sucked lately.
Also, damn AMZN killed it! I was too shy on that one.
Posted on 4/27/23 at 7:46 pm to bayoubengals88
quote:
Do I even need to own equities?
To trade? I used to. Don’t anymore. I invest in equities, bonds/notes, real estate, etc. But trying to trade stocks is too “flip of the coin” and directional for me to do the strategies that I’m doing with options. As premium sellers, we’re the casino, the house, the insurance company. Sure, we’ll get smacked with a loss every now and again. But over time and with many occurrences, the probabilities are strongly in our favor.
quote:
Also, anyone thinking MSFT cools off a bit soon? Trying for a 5/12 credit call spread with a break even of 308.80
Yesterday I would have said yes… and that’s why I didn’t buy shares to cover my 302.50 short calls when it was 296 and change. Well, I was wrong!
So I ended up buying shares today on a dip at 302.94 and sold the long 315 call wings for a few pennies. I expect the 302.50 short calls to be assigned tomorrow and my stock to get called away. If so, counting the total premium from the jade lizard minus the loss from the 302.94 purchase and the 302.50 forced sell, I’ll come out with a very small net gain. And if it doesn’t get called away, I’ll either sell slightly OTM 5/5 calls or just dump the stock at a (hopefully) slight profit in the near term. This account isn’t made to hold long stock for any lengthy period of time.
Posted on 4/27/23 at 8:00 pm to dragginass
quote:
I've started listening to all of the tastytrade videos on YouTube after plowing through the option alpha podcasts. I will revisit the OA stuff because there is so much there, but I'm enjoying the tasty content.
Great to hear. Yes, OA is very good and very useful, but Sosnoff and Battista take it to another level. I tend to watch the Tasty videos every day for knowledge, and also for motivation. I probably owe Sosnoff a cut of profits after seeing the Tasty study on how often the S&P makes 2 and 3 standard deviation daily moves - 3 Std. Dev. is less than 1% of the time (pretty much has to be a black swan event). So I modified my SPX IC and syn. strangle trades based on that. I’m still doing the 1-2DTE trades… the 0DTEs not as much. Monitoring those things and still working was taking a toll on me.
quote:
Despite some of my previous strategies hurting profits, I'm still up nicely YTD which is encouraging considering the follies.
Posted on 4/28/23 at 10:41 am to Jag_Warrior
Earnings adds for next week:
ON sold 5/5 puts 0.11 delta (62p). Stock currently between 69 and 70
Trying to get into ANET as well.
ON sold 5/5 puts 0.11 delta (62p). Stock currently between 69 and 70
Trying to get into ANET as well.
Posted on 4/28/23 at 10:51 am to LSUtoOmaha
Closed 5/5 UBER credit spread after one day for 32%
It was meant to be an earnings play but I'll take 32% prior to earnings every time.
I'm trading really small.
Credit of .53 and closed at .36
Just one contract but they're adding up nicely this week!
I've got a few IC's on deck, but they won't fill.
It was meant to be an earnings play but I'll take 32% prior to earnings every time.
I'm trading really small.
Credit of .53 and closed at .36
Just one contract but they're adding up nicely this week!
I've got a few IC's on deck, but they won't fill.
This post was edited on 4/28/23 at 4:11 pm
Posted on 4/28/23 at 10:58 am to bayoubengals88
Nice man. Don't blame you for closing. Uber is not really a name I would be thrilled about owning the underlying.
Posted on 4/28/23 at 11:08 am to LSUtoOmaha
quote:
Uber is not really a name I would be thrilled about owning the underlying.
I agree. It’s too volatile and unpredictable for me to invest in. And even in my trading account, I’d be nervous about holding it while I tried to wheel it for a profit if I got assigned. I think he made a good decision by taking a quick profit on that one and moving on to other opportunities.
Posted on 4/28/23 at 11:15 am to Jag_Warrior
Jag- Anything else you are trying to get into for next week? I have ON filled and am trying to get a fill in ANET and INMD.
Posted on 4/28/23 at 11:23 am to LSUtoOmaha
quote:I looked into this, but bid/ask was so wide. Planned on doing a conservative put credit spread.
Trying to get into ANET as well.
AMD anyone?!
Posted on 4/28/23 at 11:25 am to LSUtoOmaha
I’ll actually be on my honeymoon next week. Is that going to stop me from making at least a few trades? Nooooo!!! 
For next week, I’m taking a look at what IV and sentiment looks like on AMD, SBUX, AAPL and SQ so far. Maybe COIN, but that’s another unpredictable stock (IMO).
One goal while in NYC is to be a literal Wall St. trader (get my picture taken while making a trade in front of the NYSE - I’m such a rube)
For next week, I’m taking a look at what IV and sentiment looks like on AMD, SBUX, AAPL and SQ so far. Maybe COIN, but that’s another unpredictable stock (IMO).
One goal while in NYC is to be a literal Wall St. trader (get my picture taken while making a trade in front of the NYSE - I’m such a rube
)Posted on 4/28/23 at 11:39 am to bayoubengals88
Good call on AMD. IV looks to be above 50. Looking at the deltas in the low teens, I like the weekly 79 put at the 13 delta. Thoughts?
Congrats on honeymoon Jag
Congrats on honeymoon Jag
Posted on 4/28/23 at 12:06 pm to LSUtoOmaha
Thank you. It’s been a long time coming. She’s a patient woman. Could be I found a unicorn.
With a current expected range of +/- 6.77, I think that’s a good area to play it. I’ll probably look to make a trade on it on Tuesday, since Monday will be a busy travel day.
quote:
AMD. IV looks to be above 50. Looking at the deltas in the low teens, I like the weekly 79 put at the 13 delta.
With a current expected range of +/- 6.77, I think that’s a good area to play it. I’ll probably look to make a trade on it on Tuesday, since Monday will be a busy travel day.
Posted on 4/28/23 at 12:50 pm to Jag_Warrior
Congrats Jag
quote:This is great
One goal while in NYC is to be a literal Wall St. trader (get my picture taken while making a trade in front of the NYSE
Posted on 4/28/23 at 6:18 pm to bayoubengals88
Put a wide ANET short put spread on (for margin purposes). The near leg is around 9 delta. Reason being, I already own ANET stock, and I really don't want more unless I get a big discount. So if it tanks after earnings I'll convert that short leg to a larger position.
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