A newbie's index option journal

Discussion in 'Journals' started by JLB123, Feb 17, 2007.

  1. JLB123


    200701 monthly return 7.7%
    2007 year to date return 7.7%
  2. JLB123


    200701 monthly return 7.7%
    2007 year to date return 7.7%
  3. JLB123


    200702 month to date return 3.69%
    2007 year to date return 11.64%

    Open position(s) : 2
  4. JLB123



    Would have made 30c more on the SPY Feb 141 call if I wasn't being forced to liquidate the position at 1pm ET instead of sell at the mkt close, due to 'insufficient fund to exercise the option'. :(
  5. JLB123


    2007-02 month to date return 5.67%
    2007 year to date return 13.75%
    vs. 2007 year to date SPY (S&P500) return 3.12%

    Open position: 1

    Indicator changed in the last minute, was not able to close all positions in time. The remaining of call options to be sold at open on 2/21/2007.
  6. JLB123


    2007-02 month to date return 4.77%
    2007 year to date return 12.79%
    vs. 2007 year to date SPY (S&P500) return 3.08%

    Open position: 0

    Refer to yesterday's post, the remaining of call options were sold at open on 2/21/2007 @3.5 which should've been sold @3.8 the previous close. I guess I could've act a little faster to avoid such an Un-necessary loss. :mad:
  7. JLB123



    Initiated long position with DIA March 125 call @2.65.
  8. A suggestion...

    This would be far more interesting if you posted something about your methodology.

    What are you looking for? - entries, exits, targets, stops, underlyings.

    Do you just do long calls, etc?

    No we don't want your secrets. Just enough to keep our interest and offer help and critiques.

    Good trading to you. :cool:
  9. JLB123


    Thank you for your suggestion Wayne.

    The methodology is a combination of many customized indicators. But the core idea is finding the relationships between different investments so I guess it can be called a Multifactor relative value trading model.

    I do look for entry and exit point with pre-defined rules. I don't set stop loss because I keep the % capital per transaction small. I have tested the model with various stop-loss triggers but % return vs. drawdowns are just not as good. Due to this reason I only buy call options for max leverage with limited risk.

    I think there are other potentials with this model as well. eg. it can easily be turn into a long-short statistical arb strategy... but I must admit my favorite is still trading calls... Not only because it's a bit more exciting but nothing beats the feeling knowing odds is on your side in the long run before executing that trade. :p

    Needless to say I have paid my tuition to the university of financial market before I actually sit down and figure out what is the trading method that really fits me. I have been working on this model for a few years and paper traded a year. Finally it was only until about 10 months ago that I started to trade with real money, as well as confident, again.
  10. gg12


    My fist impression is that you apply a systematic approach.

    I agree with you that buying Calls is a good strategy if

    - general markets continue to point up longterm (as they actually do)
    - timing is correct (i.e. buying on dips etc.)
    - volatility estimate is correct (VIX is extremly low favoring longs)
    - duration of call is long enough to profit on up-movements
    - strike price is calculated to have a good ratio between gains (leverage) an losses
    - commissions can be further reduced!

    Good luck in your trading!
    #10     Feb 24, 2007