Trading without stop loss using options

This is a discussion on Trading without stop loss using options within the Trading Systems forums, part of the Methods category; Trades without stops will occasionaly lose very heavily , the losses from this type of trading will wipe out several ...

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Old May 4, 2017, 8:38am   #1
Joined Apr 2017
Trading without stop loss using options

Trades without stops will occasionaly lose very heavily , the losses from this type of trading will wipe out several months of profits.Placing stops is a double edged sword , stops are hit either when bucket shops /spreadbetting brokers look for stops or when markets become extremly volatile.Using stops can result in stops getting taken out , and then to make things worse, the price goes without you.


Using a weekly or monthly put option for a long trade or a call option for a short position , is an alternative .There is the cost of the options to be deducted from profits , but this cost gives the holding power to hold on to your trade , for almost a week or month.

As an example
weekly dax put long cost 34 strike 12400
long cash dax 12463

See image


You need a lot a patience ,to wait for the trade and to run your profits.

Read following to experience and understand stops and chaos.

http://www.trade2win.com/articles/16...tive-stop-loss

http://www.trade2win.com/boards/educ...power-now.html

http://www.trade2win.com/boards/tech...rade-stop.html

http://www.trade2win.com/boards/trad...-system-3.html
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stop.jpg  
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Old May 15, 2017, 7:26pm   #2
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was looking at the forum board saw 2 threads:;Trading without stops' and thought "Noooooo.. don't do it!", I couldn't even bring myself to look and then saw yours ..'with Options' now thats far more sensible I thought

You using IG? Are your cash or futures positions settled/squared in the same trading account as your options insurance? and what options u using? vanilla?, barrier? what type? thx
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Old May 15, 2017, 7:30pm   #3
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I read some of your options strategy somewhere you just kind of double down and it kind of makes sense but what happens in a sigma 9? remember LTCM?
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Old May 15, 2017, 7:39pm   #4
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and also (sorry for questions but I'm genuinely interested) How do you view the trade? as a cash/ futures position with an options hedge or as an Options Trade hedged in the cash market?
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Old May 15, 2017, 7:55pm   #5
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foroom lluzers started this thread
Quote:
Originally Posted by Convergence View Post
was looking at the forum board saw 2 threads:;Trading without stops' and thought "Noooooo.. don't do it!", I couldn't even bring myself to look and then saw yours ..'with Options' now thats far more sensible I thought

You using IG? Are your cash or futures positions settled/squared in the same trading account as your options insurance? and what options u using? vanilla?, barrier? what type? thx
Vanilla options mainly weekly options .

I use cash which never expire and weekly expire on fridays at 16.30
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Old May 15, 2017, 7:56pm   #6
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foroom lluzers started this thread
Quote:
Originally Posted by Convergence View Post
I read some of your options strategy somewhere you just kind of double down and it kind of makes sense but what happens in a sigma 9? remember LTCM?
They are covered by options ,limited risk .
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Old May 16, 2017, 2:04pm   #7
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Originally Posted by foroom lluzers View Post
They are covered by options ,limited risk .
Thx for answers
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Old Jul 23, 2017, 8:22am   #8
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foroom lluzers started this thread Good article here

http://www.trade2win.com/articles/13...managing-exits
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