neke can you discuss what type of options you trade..itm, otm, ?.. the strategies as well?...are most of these covered calls? as your buying the options along with owning the stock? how long do you hold on to these option trades?...hrs..days? I'm trying to trade options now. I just opened an account with TOS. I actually took my first option trade a few days ago. 10 june 8 citi calls at .11 per contract. if you dont want to say in the thread, could you PM me instead? thanks - Nate. side note --> I dont have much capital in my account..just shy of 10k, so being able to trade options successfully would REALLY help.
I don't think going to the most juiced derivative you can possibly trade is going to help you learn. It's unlikely that you'll trade these options successfully, and it sounds like you bought deep otm calls, which will most likely expire worthless.
Solid performance for 4 days trade. Just imagine what a non trader would think of making 45k in four days. 400k is the magic number!
Awesome job Neke! You broke through 365,000; now that previous resistance becomes support for the next leg up
The options are directional (no writing, no covered calls, just long calls/puts for a short time - less than 1 day in most cases). You should only try options if you have been successful in the underlying stocks. The cost of options(bid/ask spread + commission) will not be worthwhile if you cannot make money on the stocks themselves. I trade mostly near the money, definitely nothing as out of the money as the case you stated. Do you know the cost of trading a 0.11 option? Assuming the increments are 0.01 (bid 0.10 ask 0.11), that's already 10% for the spread. If your broker charges 75c per contract, then you are giving up about 25% of your money upfront (spread + commission). What kind of edge do you think you have to make it in the long run there? If you look at my trades I hardly buy any options priced less than $1.00, even if the spread is as low as 0.01. Think first what edge do I have in the underlying stock (expected AVERAGE % gain) over your holding timeframe, then translate that to the option. If it covers the above costs and still leaves you a good gain, then try it, otherwise stay away.
i sold my c calls, made 50 in a couple days. now I got 1 SEPT VLO 16 call. break even is 19.42 and price right now is 19.35...i think we can go + 5 cents in the next three weeks. Is this more like a trade you would take?