Bread and Butter

Discussion in 'Trading' started by easyrider, Aug 24, 2002.

  1. Shit happens, one of my best and experienced trader turned white the other day when the market shot up like a rocket and then completely retraced, catching him with a screen full of bullish trades and no way to get flat; all in the course of about a minute.

    I missed seeing it; would have been worth it for the money ...
     
    #71     Aug 25, 2002
  2. lundy

    lundy

    this seems typical.

    waded thru 12 pages of shit to read 2 worthwhile and on topic posts.

    brandonf, you have my respects (fwiw)

    and to post something worthwhile, here is a simple technique that I like.

    SELL COVERED OTM CALLS

    this works best in a bullish market, good in a ranging market, average in a bear market.

    Find a stock you like, but aren't sure of the exact bottom or entry. Be prepared to buy more lower, in case it goes lower. Then just sell out of the money calls until you detect upward momentum.

    You make money if the stock stays the same, you make money if the stock goes up, and your total cost of ownership is lowered with every round of options you sell. So, you fair "ok" even if the stock continues lower.

    There are a lot of ways to enhance this strategy. This is bread and butter people.
     
    #72     Aug 25, 2002
  3. Until it gaps down against you ...
     
    #73     Aug 25, 2002
  4. nitro

    nitro

    nitro :confused:
     
    #74     Aug 25, 2002
  5. We trade that way; bullish trades are green, bearish are red, _uck-ups are black; that is the only way we found to keep track of a bunch of positions.
     
    #75     Aug 25, 2002
  6. Nitro,

    And before you tell me how you can't believe we do that; I know it sounds stupid; but the older I get the more stupid things make money.

    However, it is not as stupid as Bright's duckies lining up ...
     
    #76     Aug 25, 2002