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Let's Trade Options

  • #11,561
  • Dec 20, 2015 2:49pm Dec 20, 2015 2:49pm
Quoting The Fool
{quote} I keep thinking I might see a market in my lifetime (omg what's left of it) that will make some good moves, so I have been seeing diagonals and long-dated calendars etc as ways to buy in to simple long options sets that will go deep deep itm. That's all I'm really asking for - just a few trades a year that make insane profits - gimme some 20-50 lot shots at like $10-$20 itm or better. Can I get a witness? Slogging thru the shit week in week out for a bunch of $0.25 winners is for the birds.
I sometimes feel like an options "canner" (the homeless guy who wanders around the neighborhood picking up cans in his shopping cart for .05 a pop ... ) ... . They do add up, but it's quite a bit of work ....
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,562
  • Dec 20, 2015 2:51pm Dec 20, 2015 2:51pm
I hate playing defense, but here's the way to do it with short strangles ... . https://www.dough.com/blog/inverted-strangles (Boning up on my fundamentals while I dry some powder out over the next couple of weeks ... ).
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,563
  • Dec 20, 2015 2:55pm Dec 20, 2015 2:55pm
Here's a really fundamental question that I don't know the answer to off the top of my head (since I still have never done a diagonal, let alone a double). I do know that when you leg into one side of an iron condor and then into the other, you basically only pay margin/buying power-wise for one side of the setup (the put spread "offsets" the call spread from a margin standpoint).

Does the same go for a double diagonal, where you're paying a debit to set up a side?
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,564
  • Dec 20, 2015 2:58pm Dec 20, 2015 2:58pm
omg, who will be left standing in the gas patch? CHK you gotta bet will survive - but no guarantees.....if it gets down to the low $2.xx prints I will have to be buying some shares.....natgas is not gonna stay cheap 4ever, more and more will be needed as N. America continues to abandon coal gen plants....then there's the LNG export boom, waiting to happen......look at what they pay for natgas in (fill in blank here....it's way more)......

http://finance.yahoo.com/news/crunch...120001964.html

"Two Texas-based drillers, Magnum Hunter Resources Corp and Cubic Energy Inc, filed for bankruptcy this week. Chesapeake, the No. 2 U.S. gas producer, is working with Evercore Advisors to restructure debt or sell assets.

On Friday, U.S. natural gas futures dropped to a 16-year low of $1.68 per million British thermal units on the New York Mercantile Exchange. Supplies for delivery through the first quarter are trading below $2 for the first time since the 1990s.

Two more months of mild weather could send natgas futures as low as $1.25, said energy analyst Kyle Cooper of IAF Advisors and Criterion Research. That would be well below what it costs drillers to pump new supplies from the ground."
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,565
  • Dec 20, 2015 3:00pm Dec 20, 2015 3:00pm
Quoting The Fool
{quote} tired of paying big comms on spreads? well, just go long VIX puts whenever there's a ^VIX spike - you can track the change in price for any option from the day they were born til the day they die, the VIX Feb $14 puts shown below - 10c is the bottom {image}
I need to find my way around ToS a little better; the range at which given strikes for an instrument like VIX trade at is good to know ... . Otherwise, I'm just stabbing around in the dark ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,566
  • Dec 20, 2015 3:01pm Dec 20, 2015 3:01pm
Quoting The Fool
http://finance.yahoo.com/news/crunch...120001964.html "Two Texas-based drillers, Magnum Hunter Resources Corp and Cubic Energy Inc, filed for bankruptcy this week. Chesapeake, the No. 2 U.S. gas producer, is working with Evercore Advisors to restructure debt or sell assets. On Friday, U.S. natural gas futures dropped to a 16-year low of $1.68 per million British thermal units on the New York Mercantile Exchange. Supplies for delivery through the first quarter are trading below $2 for the first time since the 1990s....
Faaaack .... . A buck and a quarter ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,567
  • Dec 20, 2015 3:05pm Dec 20, 2015 3:05pm
otoh....the fracking revolution that has imploded the ng market here can happen all over the crust of the Earth....we could see natgas prices dropping for years and years......shit it won't be long til you can buy a Mr. Fusion at Costco.....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,568
  • Dec 20, 2015 3:11pm Dec 20, 2015 3:11pm
Quoting The Fool
omg, who will be left standing in the gas patch? CHK you gotta bet will survive - but no guarantees.....if it gets down to the low $2.xx prints I will have to be buying some shares.....
I'm in a CHK covered call at the moment, with a cost basis of $4.35 ... . I figured I'd grind away on that for a while, since it's closer to a bottom ($0) than UNG ... . Lol.
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,569
  • Dec 20, 2015 11:45pm Dec 20, 2015 11:45pm
up....and down....are you sick of your boring life? Well, you should trade the markets, they go up....and down. Now up, we rally, Santa says it's ok, all you need to know - up...and down. When it up, buy SVXY, when down....buy UVXY. Make big money.

Inserted Video
Attached Image (click to enlarge)
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,570
  • Dec 21, 2015 12:30am Dec 21, 2015 12:30am
big long wti trades going down Friday with Feb and Mar USO $2 & $1.5 long call verts - 30,000 lots....well I might shoot 10....
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,571
  • Dec 21, 2015 12:43am Dec 21, 2015 12:43am
wti last touched $50 on 10/9/15, when USO printed $16.20 high
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,572
  • Dec 21, 2015 12:55am Dec 21, 2015 12:55am
the USO Jul $16.5/$18 calls spread a nickel, risk $140 on a 20 lot to make $2850 if wti rallies towards $60 in the Summer
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,573
  • Dec 21, 2015 1:18am Dec 21, 2015 1:18am
ban on US crude exports lifted? WTI/BRENT spread will m/l go away.....we're already there....
Attached Image (click to enlarge)
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,574
  • Dec 21, 2015 1:32am Dec 21, 2015 1:32am
Quoting ZebraSquirl
I need to find my way around ToS a little better; the range at which given strikes for an instrument like VIX trade at is good to know ... . Otherwise, I'm just stabbing around in the dark ... .
lots there, I have just barely scratched the surface, only so many hours in the day & all I need to do is pretty easy.....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,575
  • Dec 21, 2015 11:27am Dec 21, 2015 11:27am
Thinking of some bearish play on TSLA.

Daily chart:

Attached Image (click to enlarge)
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Red ma is daily 200... 4th rejection from her, from upper channell line, old SR at ~235...
Thinking about selling some close call spreads, like maybe Jan 235/237.50 or something... working idea.
Hope is dangerous in this game.
  • #11,576
  • Dec 21, 2015 9:39pm Dec 21, 2015 9:39pm
nice spike in /NG over last 2 days & Jan UNG $8.5 calls are just 8c......winter
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,577
  • Dec 21, 2015 9:43pm Dec 21, 2015 9:43pm
Quoting StrayDog
Thinking of some bearish play on TSLA.
http://www.businessinsider.com/junk-...-again-2015-12

chickens coming home to roost? just take your pick among the risky overleveraged names....the melt-up mofo market is long overdue for some bloodletting.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,578
  • Dec 21, 2015 11:55pm Dec 21, 2015 11:55pm
Quoting ZebraSquirl
{quote} I'm in a CHK covered call at the moment, with a cost basis of $4.35 ... . I figured I'd grind away on that for a while, since it's closer to a bottom ($0) than UNG ... . Lol.
(Gets out defib paddles ... . "Clear!" ... . (Shocks natty gas back to life). ... "We've gotta pulse!")
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,579
  • Dec 22, 2015 12:00am Dec 22, 2015 12:00am
Most likely, last earnings play of this fabulous season:

NKE
Dec 31st 118/141 short strangle
POP%: 75%
Max Profit: $125/contract
BPE: ~$1572 (supposedly, I don't trust Dough after hours; get's funky)
BE's: 116.75/142.25

Will do some price discovery on it tomorrow, see if I can squeeze some more out of it ... .

Watching MU (earnings tomorrow after market close) for a vol pop; ain't there yet ... . Thing's got some potential upside, so I want to covered call it if I can ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,580
  • Dec 22, 2015 12:11am Dec 22, 2015 12:11am
Quoting StrayDog
Thinking of some bearish play on TSLA. Daily chart: {image} Red ma is daily 200... 4th rejection from her, from upper channell line, old SR at ~235... Thinking about selling some close call spreads, like maybe Jan 235/237.50 or something... working idea.
Ahhh, TSLA, I remember ye fondly ... . Next earnings in 50 days; my guess, another lackluster quarter in store. Last earnings, price actually popped and then dropped on "not as bad as expected" earnings ... . What a crock ... .

A Dec 31 217.5/247.5 short strangle will get you a 1.87 credit/contract ... . Kinda tempted to dip my foot in ... . Wouldn't mind 50% of that for probs <9 days' work ... . A theta of 30.92. Yeesh ... .

And ... an ideal time for it go nowhere ... .
Fireworks are fun ... as long as you don't blow your fingers off.
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