rolling long calls up to follow a trend

Discussion in 'Options' started by traderlux, Feb 20, 2011.

  1. any one trading (or have traded) long calls (or bull call spreads) and rolling up to follow a trend?
  2. spindr0


    Rolling the calls up and pyramiding them into a bigger position in the midst of a strong uptrend is an awful lotta fun until the underlying reverses hard. Been there, done that and owned the tee shirt once upon a time. How do you spell C-O-L-E-C-O ?

  3. But Profit taking, and rolling up the rest of the calls would have been good, no? :)

  4. Visaria


    By rolling up, you mean buying a call waiting till the underlying goes up, sell the call and then buying a higher strike/later expiration, repeat?

    Can be v profitable if the trend persists.
  5. redwraith


    I buy deep-in-the-money options of the SSO to trade the SP500 and do that all the time, especially since September while the market has gone basically straight up. It works fine, it just has the effect of forcing you to take a profit every once in a while.
  6. Visaria


    I think it would better to buy atm or maybe slightly out of the money calls and then roll those over.
  7. lol easier said than done :) But correct. Regardless, you won't be selling the top and time decay will nail some profits too.
  8. That's circumstantial. The tails are fatter farther OTM. If you're good, (or you're "good" ;) *wink*)....OTM are almost always the way to go.
  9. donnap


    A funny thing happened on the road to riches:)
  10. red,

    how far out in time do you buy?
    what is the "forcing" mechanism to take profits?
    is it part of your trade plan?
    do you buy any puts along the way for protection?
    do you use any t/a as part of the plan?

    i saw an example of rolling up using ditm calls in a webinar that was light on details and i was looking for some real world feedback. i like the idea of using an etf as the underly.

    #10     Feb 21, 2011