So I was thinking of trying out the stock repair strategy on one of my positions that is currently -pnl. https://optioncreator.com/sttf2b7 My spreadsheet version is showing that I will break even @ $19.88, but on option creator it is showing the break even around $21. I'm assuming the premium box for shares should be your current avg price? Here is the spreadsheet version. The position is opened with a credit so it should lower your break even without adding risk.
Stock repair?? What happened ?? Got caught in an extended C wave?? Arent you the guy who doesn't believe in managing risk,delta hedging, Black Scholes or stops?? Now you are adjusting to breakeven at best on a turnaround while offering zero downside protection.. Do yourself a favor and read Macmillan.. Here's a bone.. 1x2 spread breakeven (Difference between strikes plus the credit or minus the debit ) / net short options. Add that to upper strike if a ratio call spread. 17-19 1x2 for a .37 credit 2.37 added to 19 21.37 is upside breakeven
Yes I told you extended C's are how I get MAX position and therefore MAX profits! Mcmillian was the first book I read on options...I forgot it has all the handy math. ...working through Natenburg. I don't mind hedging risk without realizing losses such as with stops or long puts etc. Short premium is essentially a dynamic stop loss.
There is no added risk. It is opened with a credit and lowers your break even. If the stock continues down then you suffer the same losses as you would have anyway...except without collecting any premium. 21.37-17=4.37 21.37-19=2.37*2=4.74 ? Anyway, apparently with the stock repair strategy, You can't just pick an atm long call and then split the difference willy nilly...ie if you bought @ 20 and price was @ 15 you can't just buy 1 long @ 15 and sell 2 shorts @ 17 and expect it to work out. I would need to get $1.66 for my short calls if I was buying the long call for $2.07 for the strategy to recover my losses of -5060. Any less and it will fall short, and the shares would get called away at a loss. $19 is the max gain for the ratio spread and therefore the position. After that, the stock and long call profits will be cancelled out by the short calls.
Sure there is,you are giving up all upside above the BE I laid out.. Lol@ your example..What are those numbers?? You csn pick any spread with you want,any ratio you want.. you are looking for the free lunch, aint happening.
Why are you fcking around with income strategies (sic) when EW gives you a 100% hit rate? It's an arb. How did your interpretation of EW in MARA fail so utterly?
Lol!!! My boy is back!!! MARA ???? How about CLSK?? he didn't fail,he just a bit early on the extended C wave coming to a close..
It's not a fail until you realize a loss...currently it's just a premium earner. It's no different than investing in a dividends stock...but you get paid for the volatility. For the record this wasn't an EW trade...just traded the expected short term move. Aka an educated guess.