Diagonals versus Vertical Spreads

Discussion in 'Options' started by kalikahuna, Jul 26, 2006.

  1. :D:p come...on Eliot...actually CLOSE to the money
     
    #11     Jul 27, 2006
  2. so...is it CTM (close to the money) or NTM (near the money) or JOTM (just out of the money)?

    :p
     
    #12     Jul 27, 2006
  3. wow...OK,Ok, howz about

    JOTM >$1
    CTM >$2<$1
    NTM >$3<$2

    :p :D
     
    #13     Jul 27, 2006
  4. Well some I use are:

    AFITM - Almost Fuckin In the Money (which is what I use for my short strikes when the market moves against me.

    WTFOTM - Way the F@CK Out of the Money (my credit spread strikes)

    PDGPJEOTM - Please dear God Please Just Expire OTM..
     
    #14     Jul 27, 2006
  5. Nahhhh.... I don't think it is only about greed. It's about versatility for me. If I'd stopped at the first thing that started making me money, I wouldn't be even close to where I am now.

    I'm not going to sit here and tell you to pick one, because I think you should have the ability to trade both. You should also be able to do b-flies, combo to fly conversions, debit verticals, put ratio spreads, and basic long puts/calls.

    Many people on these boards fall in love with a single strategy and use that strategy in conditions for which it is not well suited. I know very few traders that are very good at staying out of the market for long periods of time if the preferred strategy doesn't match the market conditions.

    Anyway, learn them all and use the one that has the best total r/r if your forecast is correct. Remember to look at all the different ways that you can make/lose money on the trade.
     
    #15     Jul 27, 2006
  6. I believe AFITM would sound better as AITFM. :D


    (by the way, when I ran spellcheck on coach's message, it was hilarious)




    Failure is not falling down,
    Failure is not getting back up.
     
    #16     Jul 27, 2006
  7. Trying it yourself is the best way. I just did a pure diagonal yesterday. You need to have an opinion whether you are doing diagonal or credit spread. I think the market is very choppy and going nowhere before Fed meeting.
     
    #17     Jul 27, 2006