Thanks. I do a lot of options, and spreads, so my max gain and max loss are limited and tend to be approximately equal. So the best days and worst days are about the same in magnitude. The strategy is to get out opportunistically from the winners, strategically from the losers, and make money as it grinds in your favor either through decay or price bias. My problem is sticking to the risk limitation when I know better... I find that writing this stuff down publicly helps, because it plants that seed in the back of my mind, "how stupid will you look if this one goes south?"
You got be thinking about this, and I did come up with one flaw in the LEAPs strategy. You can't use straddles, and you can't trade the underlying during December (or January if taking losses). The reason is wash sales. Also, don't do this on ETFs for the same reason. You could, however, do this with similar stocks...i.e. puts on VZ, calls on T; or PEP / KO; BAT / MO + PM...
Ahh, k, I recall this now (as you refreshed my memory from that other thread). I think what I was on about was the following... I believe, when I read that initially a few days ago, I started thinking to myself... "Look at all the finagling we're doing to try to get the lowest tax penalty, and look at how far we will go to try to squeeze the "tax system"". All this to avoid paying a bit more than we would like, to Mr.TaxMan. So I then started thinking about how it is just like having an open position. We try to "avoid the tax man" in a sense by cutting our losses short. Let the runners run. I have said this over and over again in my head, and have mentioned it on forums like this...I WILL GLADLY PAY $3000 GROSS TO MAKE $1000 NET PROFIT. This means that I made $3000 profit, but lost $2000 during the run. So I net $1000. I give a flying fish about how much I spent in gross to make my $1000 net after expenses and taxes. I just don't CARE! The final net per day is the important bit. The rest is just ego, and footies in the sandbox kicking grains of grit into the eyes of the other kids..
Oh, yeah, I'm talking about gains over the course of 12 months minus a few days, or gains over 12 months plus a few. Not about day trading gains. I'm actually worried because I could certainly see a specific rule against this being a real thing...but I also think that a LT/ST threshold of 11 months or 13 would render the strategy irrelevant, thus it's by design. I mean the whole concept of LEAPs (vs any other option) is that you benefit from the LT tax regime...it's not a LEAP if you dump a loser early.
When all is said and done, after fees and taxes are taken out, you're at, say, $50,000 in your pocket. To mull over how one COULD have been $150,000 in the pocket is the serious detriment to all traders, everywhere. Be happy with what you HAVE done, not sad about what you COULD have done. Plug that into the formula. Like today. I could have made just over $1,000 in trading, if only I had just done this or that. But I did not do "this or that", and so I made about $400. THAT is what I must be content with. To do otherwise is mental implosion.
You know this, but for the naysayers, AMZN puts everything into dominating new markets (pantry, now auto parts) then they raise prices once we are hooked on the convenience (prime). Wall St. has always paid up for growth in bull markets. Mature for sure, but not exhausted. I think 16 or 17 years is the average.
I'm with you 100% on that. Opportunity cost is not a thing. I have enough existential doubt in my trading without adding in imaginary "costs". (Although, I do fret about missed trades on my stupid days--see the post from earlier today)
Went long Dec $33 calls on CSCO for a .71 debit. Another diagonal play when it turns back to bearish. I'm would guess this is going to approach $33 before Oct earnings. Let's say +/- 0.15.
Just went short JPM 8/11 $94 call for .78. Edit: Now the whole position is .57 debit. The spread on this is down to $1, making absolute risk .43. And just for some perspective, I'm getting slaughtered on MSFT (but holding tight there)