Explain this price action?

Discussion in 'Options' started by jimmyjazz, Dec 8, 2017.

  1. I held through that drop and sold half my position for a tiny profit a few days ago. I'm still sitting on the rest. My outlook has changed, not so much on the underlying but because I got clobbered on the option price via volatility. What I thought was a decent profit opportunity is now mostly defensive. I may dump the rest soon. Lesson learned.
     
    #51     Dec 20, 2017
    sle likes this.
  2. Thick as two short planks
     
    #52     Dec 21, 2017
  3. volpri

    volpri

    uh oh
     
    #53     Dec 21, 2017
  4. spindr0

    spindr0

    After a hit to P&L, I often suffer from breakevenitis and given the chance to get out unscathed, I get out of Dodge. I think that it has something to do with the market knowing more than I do about the position. ;)
     
    #54     Dec 21, 2017
  5. Trading options IS trading Volatility
     
    #55     Dec 21, 2017
    vegamedic likes this.
  6. As this thread shows. After doubling down when the option price failed to climb with a significant early jump in the underlying, I am now at a significant profit and I am out. I am going to spend some time watching the manner in which IV/HV respond to price and get a better handle on this. I can trade the underlying OK, but clearly did not properly substitute OTM calls for the underlying in this instance.
     
    #56     Jan 3, 2018