Since I´m developing this in my own mind. I´m playing with variables. I don´t know the technical lingo to call it, or explain it. Perhaps Babu with his expertise in GREEKS can put it into Greeks.
Really I´m sort of using a trending approach to trading the straddle. With order flow, volume and volatility thrown in. It has nothing to do with the spread. The straddle is just the framework to work with and a starting point. I figure three moves should see my straddle finished and out.
Just got back from my swim at the beach. Nice day indeed.
Very difficult doing what you are trying to do. Today so far QQQ fell just short of strong support by about $ .15-20... the low of the day today had u in the green total spread by about $ .18.... the puts traded at 3.42. Unfortunately price reversed too early and really didnt get u to the point where it made sense to sell the puts... right now with QQQs back at 65 spread is back where u paid for it.
Good luck... extremely difficult stuff u r trying here...
I closed the PUTS this morning RIFF RAFF for a net profit of +$285.
I have since plowed most of the money back into buying CALLS. Have 10 CONTRACTS in total now and need $2.35 to break even and cover commissions on the CALLS.
I missed another $100 on the PUTS, but since this is my second time at this, still struggling with working out the adjustments, tweeks and variables. Hopefully another time around will capture the extra $100 I missed. I made a note of what I did wrong there.
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Also gone into a real money, first time CALENDAR, just one contract though in PUTS. Got several paper trade calendars as well. Experimenting and learning here.
I closed the PUTS this morning RIFF RAFF for a net profit of +$285.
I have since plowed most of the money back into buying CALLS. Have 10 CONTRACTS in total now and need $2.35 to break even and cover commissions on the CALLS.
I missed another $100 on the PUTS, but since this is my second time at this, still struggling with working out the adjustments, tweeks and variables. Hopefully another time around will capture the extra $100 I missed. I made a note of what I did wrong there.
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Also gone into a real money, first time CALENDAR, just one contract though in PUTS. Got several paper trade calendars as well. Experimenting and learning here.
Wow...u just added considerably more risk. Did u play with fire as a child? Lol
Pray we dont have a big down day tomorrow. You at this point are down net about $ 75.00.
Start with 1000 one dollar chips, and physically do it (sim it in EXCEL). Life will simplify after that. I promise. Remember 2 numbers are ruled out (maybe more if you are skilled, but let's not go there), and you bet in the other 35 numbers an equal bet in each.
How much do you make per roll?.
It's so simple that people don't see it!.
Hello
What's youre opinion using options instead of futures in the following
Lets say ihave a fut's model that goes long short swing trading. Sometimes for a day but usually a few days. Most a week
Would it be better or worse to buy a strdl or put / call in the direction of my futures?
Example my model says I want to buy gold. What's a good option choice at the moment given directional bias for 2-3 days? Thnx
Well Riff Raff raised a worrisome point. I hadn´t thought of it myself.
What if the market goes down today?
A straddle is not a short term trade as I am doing it. I have two months I can adjust the straddle. These are three month 90 day options.
I´m sort of looking for a short covering bounce to get my breakeven. I don´t have to make money on a weak counter trend trade with the CALLS. I´m happy with a breakeven on the CALLS, as that will simply exit the straddle and leave me with a 11% gain for five days on the straddle as a whole, from the PUTS.
But supposing as RIFF RAFF suggested, what if the market goes down? Looking through other postings I see that APPL earnings comes out tomorrow Wednesday. As APPL goes, the QQQ goes as it is the dominant stock in the NASDAQ. I double checked the chart on AAPL and both QQQ and APPL are mirror images right now. Appl already dropped 10% and the QQQ has dropped 2% pre-earnings for Appl.
If the market drops today and I cannot EXIT my CALLS, I guess I will hold. An adjustment would have to be made, ( I´ve been thinking about it ) The adjustment would be to return to a STRADDLE by buying PUTS. Can´t buy PUTS right now, as the premium ballooning, or volatility on the PUTS is still swollen. Would have to wait for things to settle down. But I guess that would be my choice. As it is at the moment I´m looking for a sideways market, range bound with the monthly and weekly charts. Thats a lot of possible movement or swings in the shorter time frames of hourly charts. I have to remember I can adjust and work my way out of a STRADDLE or a STRANGLE. It would just take TIME. At the moment on TIME, I am way ahead of the game. TIME I have plenty of. So long as I re-establish the STRADDLE, or STRANGLE to take away any loss from THETA , time decay.
