Real-time options education and strategies
I’m putting my conclusion at the top of this post since I know at least some of you won’t make it to the end. It’s a simple bit of advice from someone (me) who has made every dumbass trade that can be conceived of at least 100 times in my long trading career. Here’s the … Read more
I’m going to show some posts from X describing the chart setup of Google that caused me to take a long Delta (bullish) position, how I traded that bullish bias and why I exited. Along the way I’ll be showing a option strategy that you’ve likely never seen before so read on! At the time … Read more
A treader needs the courage to trade when the setup is good but it feels bad. Shorting AAPL while it appeared to still be in an uptrend felt bad. I don’t like shorting stocks in an uptrend but when the price action is telling me, no, not telling me, screaming at me, that this rally … Read more
If I handed you a book and said that it had information in it that could potentially make you a great deal of money I’ll assume you’d open it with great anticipation. You might think “I’ll just read the book and start making money right away, what could be easier than that?” You open the … Read more
Many of the Delta Hedging (DH) strategies that I frequently use revolves around selling further out of the money (OTM) options than I own to reduce or even eliminate the initial risk of a trade. That results in some version of a spread. If I don’t want to cap the potential profits of an instrument … Read more
Below is my current Jan17/21 short SPX Call Diagonal. This is the standard 3-day (Fri/Mon) position that I always use but since Jan20 is a market holiday then this 4-day position becomes the standard for this position only. Because SPX has moved lower I have a $2,700 open profit on the position. The initial cost … Read more
If I could summarize the overall theme of this blog in one sentence it would be this: spend most of your time figuring out how you’re going to reduce portfolio risk! I think most traders put on a trade and then stick with it until it either goes bust or the pain of holding it … Read more
To address some questions regarding my current position. I’ll add more to this post later. First, let’s look at the PDT account’s combination position of Jan3/6 SPX 6045/6050 short Call Diagonal and 6050 Call Calendar with a $780 cost that was bought when it was a bullish OTM position. Now it’s perfectly centered with an … Read more
Below is an approximation of the values of a Call Calendar spread vs. a 5-point wide short Call Diagonal. I’ve compared the 2 strategies over a 1 week period of time. If I bought a 1% OTM Fri/Mon spread with 14 DTE and held it for 1 week what could I expect the value to … Read more
I’m expecting a grind up in SPX over the next 2 months so I’m layering on mostly inexpensive positions (and a few expensive ones) in multiple Fri/Mon expirations to add size and build a position. Below is my current position as of Dec4. I’ll likely be adding the trade below at some point in the … Read more