Options Training

[mechmanuk]

Hi folks, ive read and kinda understanding options, but can anyone recommend a good way to learn how to trade options without taking up to much time (work commitments)
Any advice and help to get on the ladder would be great

 

[Belligerent_Drunk]

Hi folks, ive read and kinda understanding options, but can anyone recommend a good way to learn how to trade options without taking up to much time (work commitments)
Any advice and help to get on the ladder would be great

In order of importance:
1.) Read Hull's Options, Futures & Other Derivatives. If can't take this, go trade something else.
2.) Learn the greeks and their effect on your position by heart, and the concept of vol trading
3.) Make sure you understand all spreads, boxes, etc and their effect on your greeks and P/L

Once you've survived that, your down for your first trade. In which case I'd argue:
1.) Never go naked (don't ever think about selling calls/puts without hedge)

 

[mechmanuk]

In order of importance:
1.) Read Hull's Options, Futures & Other Derivatives. If can't take this, go trade something else.
2.) Learn the greeks and their effect on your position by heart, and the concept of vol trading
3.) Make sure you understand all spreads, boxes, etc and their effect on your greeks and P/L

Once you've survived that, your down for your first trade. In which case I'd argue:
1.) Never go naked (don't ever think about selling calls/puts without hedge)

many thanks, i will defo get these and get reading cheers

 

[foroom lluzers]

many thanks, i will defo get these and get reading cheers

Until you put on demo trades for months , you will not know reality of options.

http://www.trade2win.com/boards/edu...92-your-brain-wasnt-built-handle-reality.html

 

[Windlesham1]

http://optionsinvesting.co.uk I post trades weekly- real trades-take a look and learn from the real world examples. We do NOT want your money, we are not a get rich quick scheme or binary BS

 

[foroom lluzers]

http://www.trade2win.com/boards/trading-systems/223496-trading-without-stop-loss-using-options.html

How to use options for stop loss

 

[lawrence-lugar]

Hi folks, ive read and kinda understanding options, but can anyone recommend a good way to learn how to trade options without taking up to much time (work commitments)

Any advice and help to get on the ladder would be great

The secret to success in the markets are: there are no shortcuts.

You have to stick with it for a really long time, till a light bulb goes off in your head and you experience a certain degree of that Eureka moment

Too many people like you exists, no offence,...where they expect someone to hand them instant gratification.

 

[Windlesham1]

on 6th May I posted this In Case You'd Forgotten- The Lowdown on the Synthetic

This trade involves buying a call (7300 debit 14.5) and paying for it by selling a put (7050-credit 15). Entry cost,therefore, is a tiny credit of 0.5, plus the margin required for the short put. I'd be looking for a quick turnaround, as this is directional. FTSE closed around 7300 on Friday, and these options expire on 19th May.

Tonight's Prices

The call(which we own) is 73, the put(which we sold for 15) is 3.

In summary

We thus have a massive massive profit of 70, on a zero cost trade,using maybe £1,000 of margin. If 70% in half a week is not to your taste, you may wish to look elsewhere.
It made over 100%

 

[Windlesham1]

this week-Trade 29 - A Monster Winner

That trade involved buying a call (7300 debit 14.5) and paying for it by selling a put (7050-credit 15). You could have got over 110 for this if you'd been smarter than me at closing out. ROCE over 100% in a week? Great outcome.

Trade 30 Taking the Other Side

Let's say that the market looks toppy (it has since hitting 7000 in my estimation-feel free to ignore me) 7447 is the previous all time high,and FTSE is now 7436. Believing the market might drop, I like the following combo: Sell the June 7550 call(23) and BUY the 7150 put(22.5). A tiny credit of 0.5

What Does This Mean?

A toppy market needs to be shorted, so you'd buy a cheap put with volatility at fire sale levels. That same thinking says sell a call. We are thus reinforcing the conviction in that trade. In addition as trade29 had such a phenomenal outcome and it was time to close out,consider the reason for closing out

All or Nothing

Our positions can be closed in entirety, or, in part when trading multiple contracts. Keeping a little part of trade29 alive would hedge trade 30.

Caveat: I have no idea where the market is going, and I want to show trade repair when things go wrong. To date the fun trades here have had amazing outcomes. Genius? Nooooo. Chance? To a degree. Experience? Definitely-and you get it all for free here, with pleasure.

 

[Windlesham1]

tried to show how reversing the position can be profitable-this trade(29) was so crazy-making over 100% at one point,but the revers trade got ugly and then today, you could have closed for a healthy credit of 14. Trick is NOT to panic. I'm not advocating this style I just have a passion for options and I want people to wake up and see what's possible compared to the daily soul crushing of forex where you just lose money over time

 

[Windlesham1]

on 6th May I posted this In Case You'd Forgotten- The Lowdown on the Synthetic

This trade involves buying a call (7300 debit 14.5) and paying for it by selling a put (7050-credit 15). Entry cost,therefore, is a tiny credit of 0.5, plus the margin required for the short put. I'd be looking for a quick turnaround, as this is directional. FTSE closed around 7300 on Friday, and these options expire on 19th May.

Tonight's Prices

The call(which we own) is 73, the put(which we sold for 15) is 3.

In summary

We thus have a massive massive profit of 70, on a zero cost trade,using maybe £1,000 of margin. If 70% in half a week is not to your taste, you may wish to look elsewhere.
It made over 100%

THEN.... took the opposite trade
A Reminder of That Trade:

Sell the June 7550 call(23) and BUY the 7150 put(22.5). A tiny credit of 0.5Booking Another Winner- But You need To Know This

I thought the market action was crazy and on Monday- I had prepared some adjustments. The 7550 call went to 31 and the 7150 put down to 19,and then came back to 22. The 7100 put was trading at 16.5(Sell this ) The call spread 7500/7550 was trading at 14 (45-31). (Buy this spread). You thus own a put spread and a long call spread with further short calls. This is a call ratio spread. If the market keeps going nuts(up) you have the long call spread to give some insurance.

Tuesday- What Are They Smoking?

We see another comedy high for FTSE after TEN consecutive up days. This is making me feel very unsettled, and it seems is mainly due to the dumb money going into ETPs. There are many Exchange Traded Products that are just index trackers- they seem like a good idea. Until they aren’t

What Actually Happened

Tuesday, FTSE was like a crazed rhino on Red Bull laced with cocaine. I waited until Thursday and around 11:00 in the morning the put was 42,and the call 28. I’ll book that 14 as a good profit.

 

[Windlesham1]

next trade:
Here’s the Plan

June FTSE expiries-19 days to go. Buy the 7625 call @22, sell 2 of the 7700calls @11.5– result small credit of 1. Buy the 7450 [email protected],sell 2 of the 7350 puts @15, thus a small debit of 0.5. Overall more or less zero.

What’s the Point?

Unused margin no longer sits, idly losing value. Thinking that the market has run its course, (or perhaps not) we are thus positioned for moves either way. We realise profits as the market moves above 7625, or below 7450. Risk? what about the risk? This is the interesting part. With both sides the result is we own some options and have sold more. Ponder anew. We therefore own a spread, and potential value, along with some short options. Our 7625/7700 spread is locked in should the market go that way.Thus the 7450/7350 is too.

Where is the risk?….7775. The puts? Risk at….7250. Understood?

Max Reward

With a market drop our puts thus give 100, or subsequently on a rise, the calls give 75.

 

[Windlesham1]

From our website: So, How To Win at Elections?

We don’t know, but based on the polls it looks like a landslide to nobody. I’ll state here and now that I take no credit for this trade, I was thinking of a put spread.

It’s A Straddle

Pure and simple-buy low volatility. Here we are buying both the call @56.5 and the put@ 75. Total cost,and therefore risk= 131.5. Max profit ∞, or 7547-131.5=7415.5 Nice if it works out like that-especially ∞,as there’s no way to spend an infinite amount of money.

Could we Do Better?

I liked the put spread long 7450@35/short 7350 @15 for a cost of 20. We’d need the market to tank, but taking a direction might not be a plan. Risk limited to cost, reward max 100-20=80.

 

[Windlesham1]

here's trade 35 from the site: max profit 100, max loss(theoretical 50-actually we adjust)We are selling a call spread and the premium thus received will buy a long put spread. The reasons for this trade are that margin is limited to the value of the short spread. The market seems to be teetering around the 7400-7550 level and may be in for a bit more reality. We are of course now in the July expiry cycle.

So- What’s the Deal?

We thus have… selling 7550call @ 39 buying 7600 call @24.5 Then……. buying 7300 put @ 38.5 selling 7200 put @25

The call spread thus sells for (39-24.5)= 14.5, and the put spread costs (38.5-25) = 13.5. Our nett cost is a tiny credit of 1.Market drops we makeup to 100, market goes nowhere we lose nothing, market goes up beyond 7550,we adjust-and we can show you how

 

[Windlesham1]

options are derivatives securities, for trading in options, an investor has to pay a premium amount to enter in the market.Options trading is less risky than trading another segment.

You are right- but it's our little secret-it makes us money every month,while the forex guys are sweating, crying and beating themselves up

 

[andrewhannigan]

There are various options trading strategies but each strategy has its own pros and cons. Each strategy will work the best under certain market conditions, and no strategy will work under all market conditions.

 

[Windlesham1]

Are you a traders? i have one question can you tell me how can avoid loss in share market, is there any strong strategies for trading in a smart way?

YES!!!! I am a real 100% trader who has been trading options badly since 1999. I make money every month every year. One of my best years was 2008 when the clown market was dropping like a stone. In fact I was embarassed, making money from the misery. Follow my website and you will get a great idea of how REAL trades work. I am so sick of the pathetic little losers in the UK who have not got a clue. What I do is real,it takes some effort, but has great rewards. I have just made £££ from a dropping market. 98% of the people on traders websites are just there to get angry because they lose money-why? Becasue they think trading is simply guessing a direction.

 

[Windlesham1]

my own site now has 40 trades to be mulled over if anyone is interested. Smart money means getting rich slow. For every get rich quick merchant there are 5,000 others who lost their trading pot.

 

[Windlesham1]

Trade 42

This week's trade- combo sell the August 7550 call and buy the 7350 put for a debit of 1.

 

[Windlesham1]

trade 42- made a monster 80- the other trades also made profits despite being horrible -don't waste time with the nonsense stuff like shares and forex-options are the only level playing field