yea et makes it hard to pm people. But no, I'm not a Carter disciple. I've done this through trial and error (about 15 years worth of trial and error). I'd bet most of these tickers are on everyone's watchlist too as these are the large caps where getting into and out of options are more fluid than small caps.
Yeah, for sure FANGs and other big guys, but BABA and BZUN are some of my faves. Question since I've never done a Debit Spread - is your win percentage better on those, since you're capping your upside ? I saw one post where you say that helps limit your downside, but if you are using same signal for straight calls/puts vs debit spread, and you expect a big move, why cap the upside ? thx
Debit spreads are to lower risk. I usually play these ahead of earnings where IV is very high. Ex. if NFLX straddle suggest a 10% directional move, but the avg of the last 4 earnings move is only 8%, then I use a call spread to limit my initial risk down to about 3% of the directional move so that if the stock hits that avg 8% move, I can at least double my return.
Sometimes, it also allows me to play into the stock's expected earnings move. Ex. NVDA yesterday opened lower and then trended higher throughout the day. I follow NVDA enough that I expected that (it happened in Aug 2017's earning report too).
At the open, I closed out the short NVDA 265 calls at a lower price, and then legged out the long 255 calls higher locking in a gain instead a loss. I wouldn't recommending closing a debit spread like this unless you know the underlying stock well, but it can work to your advantage.
cool, thx for the explanation on those debit spreads. I might look into that for the future. I have broken up the legs of a credit spread before, and yeah can be a little dangerous!
Looks like you are on top of market moves and news for every position. I have 3 kids, (twin 3.5 yr olds) and I usually have to take them all to school in morning so don't really enter/exit stuff till 9:30am PST. Great job, keep up the good work !
I have young kids too, and I take to school and pick them up in the afternoon too. I used to live in southern cal so I know how the time difference can be. I'm in the east coast now, so taking the kids to school hasn't been an issue any more. It made a big difference when I needed to exit trades at the open (especially earning trades).
funny you should mention earnings... AMZN earnings , following morning i looked at my phone from bed, had a nice profit, but by the time i got back from dropping off kids ... took a loss. Lame. I have a cousin that lives in Greenville SC, never visited there. I would guess its quite different than So Cal :)
I saw that BZUN is one of your favorites, I jumped in BZUN jun 50 calls this morning 15 calls avg at about 2.90. Betting on BZUN breaking above $52 and going into next leg higher.
yeah, that should be a good play. I have Jan2020 leaps on BZUN, so need to be patient but glad for strong earnings. I can send u some research on bzun if u like. Hit me up on my email, same user name, @gmail. Fridays are usually days off, unless i have positions in trouble. Usually just recordkeeping for spreads that are expiring. Don't like to enter new positions thurs/fri.
Hey, just wanted to say you are spot on taking those BZUN leaps. Looks like BZUN is breaking even above my range between $55-$59. I locked in profits on my entire BZUN already, but I'm sure your position is still adding gains.
I'm more of a momentum trader so I hold positions from 2 days up to 6 weeks at best. I'll definitely look into longer holds on some of these positions.
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