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Let's Trade Options

  • #16,901
  • Jun 28, 2019 9:25pm Jun 28, 2019 9:25pm
Quoting The Fool
{quote}Hi Ruben. I don't really trade options like you do, but you're welcome to post here. Your style is like Moneymaker's, who used to post here. I mostly trade index options spreads....
Ya..thanks Fool....this thread have 5 years ago....u have success trading options
  • #16,902
  • Jun 29, 2019 12:03pm Jun 29, 2019 12:03pm
Quoting The Fool
Ruben, Those order screen shots are quite large, take up a lot of space. Maybe you can find a briefer way to note what you have traded? Or, you can start your own thread and post whatever you like? Bear in mind, I'm not interested in buying puts & calls directionally as an approach to options trading, in general, so I'm not likely to look at or comment on your trade ideas.
Ya Fool...sorry i dont see this reply...so i will delete my post before...tq
  • #16,903
  • Jun 30, 2019 4:18pm Jun 30, 2019 4:18pm
...nothingburger photo opps over the weekend....but bull markets love nothing burgers...we'll see if the gap up
"If The Fool persists in his Folly he will become wise." - William Blake
  • #16,904
  • Jun 30, 2019 5:27pm Jun 30, 2019 5:27pm
spoos up, gold down, risk on...I have some GLD and SPY trades that will benefit, maybe break me even against bearish outcome bets....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #16,905
  • Jul 1, 2019 5:55pm Jul 1, 2019 5:55pm
Well, I'm back for at least a little while. Between gardening and some remodeling projects, I haven't traded since mid-May, and I think I've only checked in here a couple of times. Got to pick up my shower kit from Home Depot this week and remodel the master bath and that should be about it for a while....hopefully! Took longer than expected....don't know why, because it only takes them about an hour to remodel stuff on TV.....

Missed looking on line during trading hours today, but I'm going to check out KAR Calls and KLAC July19 120 PUTS @ $2.00 or better in the morning.

That's about all I saw worth looking at, though I did notice a large negative bias forming in the stocks I watch, so as that gets closer to fruition, I'm sure there will be some worthwhile trades in there somewhere. Not sure what this week's market will look like being a holiday week and all....but I would like to get into KLAC if I can at less than $2, as it looks to drop in the next day or so...hopefully it won't gap down in the morning for some reason.
  • #16,906
  • Jul 2, 2019 12:10am Jul 2, 2019 12:10am
Quoting moneymaker2
Well, I'm back for at least a little while.
Hey man...if the markets are as boring as I think they will be, you might as well come over to my place and tackle some of the projects I been putting off for 5-10 years...

...rolling into Q2 earnings I have to bet we see equities grind up generally until & unless there's a tweet or some unforseen event like war or Godzilla to scare the bulls

...btfd....sos
"If The Fool persists in his Folly he will become wise." - William Blake
  • #16,907
  • Jul 2, 2019 9:26am Jul 2, 2019 9:26am
Quoting The Fool
{quote}Hey man...if the markets are as boring as I think they will be, you might as well come over to my place and tackle some of the projects I been putting off for 5-10 years..
Heck, TF, at the rate I seem to be completing projects, I'm not sure if either of us will live long enough to see them finished!!

I think it will be boring in the markets, too. but i did manage to get into:

KLAC Jul19 120 PUT @ $2.20

Higher than what I wanted to pay, but it gapped down. I caught it on the second run up. I expect it to go down to about 118.80, which is the 5EMA, so I'll probably unload it today sometimes around the 119 level....
  • #16,908
  • Jul 2, 2019 12:19pm Jul 2, 2019 12:19pm
Quoting moneymaker2
{quote}KLAC Jul19 120 PUT @ $2.20 Higher than what I wanted to pay, but it gapped down. I caught it on the second run up. I expect it to go down to about 118.80, which is the 5EMA, so I'll probably unload it today sometimes around the 119 level....
Out of the following:

KLAC Jul19 120 PUT @ $3.00 up from $2.20

It dropped to the 118.80 area (118.77 to be exact) just like it was supposed to do. Naturally, the EMAs move slightly as price moves, but I never try to guess where they will end up, I just look at where they are when I get into the trade and base any actions on those values. Always safer that way.....
  • #16,909
  • Jul 2, 2019 2:32pm Jul 2, 2019 2:32pm
Unfortunately, I really don't see anything else worth looking at for tomorrow....
  • #16,910
  • Jul 3, 2019 2:09pm Jul 3, 2019 2:09pm
Quoting The Fool
.. ...rolling into Q2 earnings I have to bet we see equities grind up generally until & unless there's a tweet or some unforseen event like war or Godzilla to scare the bulls ...btfd....sos
...stocks up.....pm's up.....bonds up.....fuck just buy anything...this is where a dovish Fed gets ya....we won't see any significant downside until maybe the Q2 earnings start hitting in 3-4 weeks and they be bad (not likley) or maybe the FOMC passes on the rate hike at the end of the month (that neither).....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #16,911
  • Jul 4, 2019 2:31am Jul 4, 2019 2:31am
By the way, does anyone know how to calculate as accurate as possible the drop of the options` price after the earnings release? As far as it is connected with the implied volatility, it should be stricktly correllated with it. At the same time there are stocks that have relatively expensive options for the whole time, not just befor earnings. As for now, the only solution is to calculate only the price of an option intrinisc value, but the results would not be accurate enough since implied volatility drops substantially, but not to zero.

I`ve also heared about one strategy based on buing calls far from the current price in several weeks before earnings and then sell them the day before earnings to benefit from increasing implied volatility. Has anyone tryied something like that? To my mind, if the implied volatility would not change substantially both options would expire worthless. At the same time, if we will take closed options, the position price would increase so we would need huge implied volatility growth to cover costs. The only criteria I`ve managed to find for choosing stock for this strategy is shares float. The lower float creates opportunity to huge movement. In fact, this is something like to buy strangles and straddles, but not to profit form the movement, but from volatility.
  • #16,912
  • Jul 4, 2019 1:36pm Jul 4, 2019 1:36pm
Hi JC,

You can look at plots of iv over time and that will give you at least an idea about how it behaves around earnings... re: YUM you see it often drops around 10% after the ER but then ok there's an instance it was only 5%. (note cyan line)... I have not tried but suspect too many variables involved to calculate it.

If you wait for iv's to crash after an ER and then buy calls at the iv lows, timing for a rise into the next ER - yes this is something you can do with calendars....I wouldn't try it with a strangle but that's just me....
Attached Image (click to enlarge)
Click to Enlarge Name: 2019-07-04_1130YUM.png Size: 272 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #16,913
  • Jul 4, 2019 1:53pm Jul 4, 2019 1:53pm
...with YUM ER on 8/1, you'll note a premium on the Aug2 options, so the Aug2/Aug9 calendars should be cheap....the double calendar shown idk if you can get it for 15c total but maybe...20c or so maybe...
Attached Image (click to enlarge)
Click to Enlarge Name: 2019-07-04_1153yum2.png Size: 284 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #16,914
  • Jul 4, 2019 2:01pm Jul 4, 2019 2:01pm
...run the trade out to the day b4 the ER and it is in profit across the whole range....this with no assumed gain in iv's
Attached Image (click to enlarge)
Click to Enlarge Name: 2019-07-04_1158yum3.png Size: 217 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #16,915
  • Jul 4, 2019 2:08pm Jul 4, 2019 2:08pm
...same trade run to 7/30 with assumed 6% rise in iv's.....this a simplification and I'll leave it to you to develop a more refined model but you can see the calendars develop a wide profit range....if you enter 10 lots maybe take 7 off in profit the day before the ER and then....
Attached Image (click to enlarge)
Click to Enlarge Name: 2019-07-04_1205yum4.png Size: 217 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #16,916
  • Jul 4, 2019 2:14pm Jul 4, 2019 2:14pm
...let the long options run into the back week for a chance at glory....(I usually take the easy money and run....)
Attached Image (click to enlarge)
Click to Enlarge Name: 2019-07-04_1213yum5.png Size: 200 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #16,917
  • Jul 5, 2019 12:27pm Jul 5, 2019 12:27pm
trades to manage today:

Jul5/Jul8 SPY $297.5 calendar calls, bot for 14c net, flirting with a perfect finish, looking to get out >45c net

GLD Jul5/Jul12 $129 calendar puts, bot for 11c net...., could hold into next week and see what happens, but gold has been very bullish, I am tempted to get out today for a small net gain

Jul12 SPY calls fly $298/300/302....bot for 15c net and worth >40c today, will hold for a run to spoos 3,000 next week...
"If The Fool persists in his Folly he will become wise." - William Blake
  • #16,918
  • Jul 5, 2019 2:09pm Jul 5, 2019 2:09pm
Quoting The Fool
trades to manage today: Jul5/Jul8 SPY $297.5 calendar calls, bot for 14c net, flirting with a perfect finish, looking to get out >45c net.
...took 37c for the SPY calendar
"If The Fool persists in his Folly he will become wise." - William Blake
  • #16,919
  • Jul 5, 2019 8:22pm Jul 5, 2019 8:22pm
will chance some earnings trades this season, as good time for big names ER's and the Jul30 FOMC to conflate. Looking at TSLA, which could easily pop $40+ either way....ER is 7/30

looking to bracket the ER date with a double calendar or dbl diag, latter case Jul26/Aug2 $195/$192.5 puts and $262.5/265 calls for about $2.40
Attached Image (click to enlarge)
Click to Enlarge Name: 2019-07-05_1758TSLA1.png Size: 82 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #16,920
  • Edited 10:14pm Jul 5, 2019 9:59pm | Edited 10:14pm
Quoting The Fool
will chance some earnings trades this season,
looking at the calendar....

Jul 17: NFLX
Jul 18: MSFT

Jul 23: HAS,
Jul 24: AMZN, BA, EXPE, FB,
Jul 25: GOOGL, INTC, SBUX,

Jul 30: AAPL, AKAM, TSLA
Jul 31: CHK, QCOM, WYND, WYNN
Aug 1: YUM, SQ
Aug 5: CROX, ETSY,
Aug 6: MNST, ROKU,
Aug 7: TRIP
"If The Fool persists in his Folly he will become wise." - William Blake
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