Plenty of stocks out there - but your selling one year straddles so not get rich quick... Example:: GRPN trading at $4 with 4 Straddle out 283...
If you have little capital, just buy a stock you like and sell a one-year straddle and look at that premium you collect as a dividend. Then if the...
I would suggest that you make a payoff graph to help you visualize what is happening at expiry. The Y axis is your profit or loss and your X axis...
The article that you referenced does in fact bring up many of the weaknesses of the Black Scholes (BS) model that I mentioned. Read the whole...
There is little liquidity in these options so difficult to trade in/out for size. That's too much work. I like to put these trades on and go...
I would not buy a put when vols are this high. Stay small and short high vol with directional view. The way I think about the straddle is if I'm...
Correct. The leverage is not for getting big but to limit loss to pennies when wrong. When you are right, the deltas allow for equal return as...
Black Scholes fails to work correctly within 5 days and greater than 45 days. It also fails to calculate ITM options correctly. Time is the one...
Why limit yourself to 30 days? Why put constraints relative to time when your goal is making money. Time/space as the fourth dimension challenges...
Why is it hard to double when ITM? Just look for opposite option with .10 cents extrinsic and trade that one. When Long options you are Long vols...
Correct. Mid point is what your broker wants you to do and it's wrong most of the time. First look at the opposite call/put. The spread should be...
The reality of execution will never allow for 20% cut loss to happen. You attribute it to pilot error but I would call it market slippage or...
As per Tom of Tastytrade, if you don't agree with the strategy, you can do the opposite. Of course he still gets his commission on every trade....
This is the wrong assumption to make. Surprisingly, most options don't get unwound. They are liquidated via the underlying product at expiry...
I asked myself the same question 30 years ago. I can make 100% return buying an option and selling it within a few days. How long will it take me...
This is the beauty of going long options and the death of short premium sellers! There is no need for a stop due to limited loss of option so when...
Trade size is critical so model it for the possibility at zero by year end. But the high vols will guarantee a big move. This will always happen...
[IMG] The vols reflect the binary events. Until read out, this stock will drift up so you want static Long deltas and no theta decay for your...
I always laugh when the media reports concerns for user growth and profits as to why a stock drops. This is not new information so how is this the...
The most counter-intuitive thing I have learned in trading is that everyone has predictable "Blind Spots". Traders can raise self-awareness of...
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