Anyone Here Trading Options?



I tried trading options....I even tried trading the 60 second ones and felt like I was driving a Ferrari LOL....I would say that this is ok if you have money to burn but if not then I would def do something else.
 
MediaBuysEyez said:
This guy agrees w/you: Reasons NOT to trade stock options

There definitely are options techniques where it is akin to gambling but some more conservative strategies don't fit that characterization IMO. For example, covered calls combined with a stop loss order.
Click to expand...
The fallacy of this man's life is that you have to be smart to be a great trader.

The truth is that you have to be psychologically strong & smart to be a great trader. And dismissing technical analysis is like dismissing cronjobs. Just because he wasn't strong enough to know when to enter and exit trades don't mean that TA is useless.

Heck, I can't play basketball, does that mean that basketball is rubbish?

Then to say that poker has less random variance than option trading? lol

And this line says it all:
I would be a bad poker player because I don't have the skills. However, experienced and consistently successful poker players do exist.
Click to expand...
That right there shows you while he was a terrible failure. Playing poker has an extremely high psychological similarity to the mental makeup of trading.
 
MediaBuysEyez said:
LOL. You mad bro?
Click to expand...

heh, its all good.

MediaBuysEyez said:
There definitely are options techniques where it is akin to gambling but some more conservative strategies don't fit that characterization IMO. For example, covered calls combined with a stop loss order.
Click to expand...

a covered call + stop loss is the equivalent of only taking $100 to the roulette table, just more responsible gambling.

that said, if i were a gambler, i'd be tempted by the current ^VIX. trading the VIX long every time it fell below $16 & liquidating at $19 seems like ridiculously easy & repetitive 20%. but the music always stops on those cakewalks sooner or later, so i don't.
 
REIMktg said:
Anyone consider selling covered calls against LEAPS? Would that work for a safe ROI?
Click to expand...

there's no such thing as a safe ROI. returns in the market come in 2 broad categories -- 1) many small "safe" returns curtailed by 1 big "fuck you" correction, and 2) big "homeruns" curtailed by the 'death by a thousand cuts'. the score in both games is measured in your ability to stay ahead of transaction costs (commissions), which few can do. just like in casinos, both strategies are designed to delude the players while simply enriching the house.

don't get me wrong, i'm not knocking the banks as is so vogue these days, we just need to see the game for what it is. the real capital opportunity for individual investors lies in venture capital & private equity.
 
OK I'll restate. I should not have mentioned "sage" - how about "Is this a viable strategy"?

Buy the LEAP at a cost close to your stop loss = sell next expiration or 60/90 day calls. Larger ROI.

Just asking IF it would work out as it seems it might?

@Drave - venture capital and private equity? Only as good as the investment. what are you suggesting?
 
shindig said:
I'll stick to horse racing.
Click to expand...

i'm not saying all gambling strategies are bad, as along as one has a calculable advantage over the house. my avatar tag isn't "+EV (positive expected value)" for nothing. after working on wall street, i did +EV gambling for a living & made mid-six figures at it. finding situations where the odds are in your favor are tougher in the stock market than in a casino, and casinos don't often go broke.
 
REIMktg said:
@Drave - venture capital and private equity? Only as good as the investment. what are you suggesting?
Click to expand...

just that you can find goldmines out there that simply need capital to become bigger goldmines, and that those opps lie in VC/PE. once a company has gone public, "her skirt has been lifted for all to see", so to speak, so you're investing in something that everyone else on the planet already knows about. no advantage in that.
 
knownerror said:
Very interesting. I hope to get into this in the near future. Do you recommend anywhere to start?
Click to expand...

start by burning $10k in a barrel, warming your hands on those generous flames, then have a nap in the gutter, reflecting on the irony of your handle.
 
MediaBuysEyez said:
I don't want to get into leverage. My business partner's dad lost $5mm+ by trading on margin. I can see already that you need to be adept at stock analysis to make good choices on what you buy/sell along with call/put options (or more advanced trades) but I'm not going to borrow to play the options market.
Click to expand...

Options ARE leverage. When you buy or sell a contract, that gives you control over 100 shares.

John murphy's book is good, albeit dry and boring as hell.

If trading options, you NEED to understand the greeks. You need to understand how time decay works against you and how IV levels can mean you can make the right call, but still lose money.

You also need to understand the payoffs of different option types.

For example, the payoff for a covered call is exactly the same as writing a put. The difference is your margin requirements for writing a put are lower.

Writing a call on the other hand, unless you know exactly what you're doing, is a great way to lose your shirt because it exposes you to unlimited losses while giving you limited gains.

I think you need to understand basic stocks before looking at options.
 
@Drave - do you have the same gambling stance on retirement investing in the market generally? I'm more comfortable with the idea of investing in real estate so far when it comes to building a ”nest egg”.
 
You must log in or register to reply here.
Top Bottom