Dow?
- Thread starter irvinehomeowner
- Start date
NEW -> Contingent Buyer Assistance Program
So your 100% in stocks, no cash position? #veryaggresive
I didn't understand a word you said... but thanks for sharing. As for me, I had to put in an "application" to my online brokerage Sharebuilder to enable the option to trade options. More like a survey of how much I own, my trading experience, etc. All stated, nothing backed up. Got approved later today with access to level 2 options trading.
Here's the difference between leve 1 and level 2:
What is the difference between Level 1 and Level 2 option trading?
Here?s a breakdown:
Level 1
A Level 1 options trader has the ability to place the following types of orders:
Write a Covered Call (sell to open)
Close a Covered Call (buy to close)
Perform a Buy / Write (buy a stock position and sell a call to open)
Perform an Unwind (sell a stock position and buy a call to close)
Level 2
Level 2 gives you more options (pun intended) to choose from:
All Level 1 strategies above, plus:
Buy a call (to open)
Buy a put (to open)
Sell a call (to close)
Sell a put (to close)
This should be fun..
ps99472
New member
rough calculations: started playing with real money on 9/26/14, so from inception to now, my portfolio is up 3.5%. Compared to DOW, in the same time period went up 3.8%.
If we move the data point to the first day I traded stocks (1/20/15), portfolio is up 3%. And DOW is up %1.6%
If we move the data point to the first day I traded stocks (1/20/15), portfolio is up 3%. And DOW is up %1.6%
usctrojancpa
Well-known member
You guys need to learn how to trade options (especially selling naked options). It's not for the faint of heart, but if you do your homework and have a little luck along the way you'll make a tidy profit.
irvinehomeowner
Well-known member
Gas prices going up... is it time to buy solar? 
irvinehusky
New member
Early on, I realized my financial sense of timing was not very good so I lost a good deal of money on options. Yes, I bought one of the option courses from one of the guys that used to come out on the financial news a lot.
With regular stocks (no shorting, etc.), even if my timing is off, if the company is still good and it doesn't go bankrupt, I can always hang onto it for years to recover or make some money.
I also learned the hard way that I couldn't retire early buying and selling commodities like Ken Roberts was mentioning in his ads.
At one time, I was up a lot but like in Vegas, if you continue long enough, the dealer will take all your money. :'( That's why I don't gamble in Vegas.
Most of my money is in stocks and I'm very comfortable with risky stocks but no tech stocks for me. You just have to find out what you're comfortable with. Hopefully, the lesson isn't too expensive like it was for me.
With regular stocks (no shorting, etc.), even if my timing is off, if the company is still good and it doesn't go bankrupt, I can always hang onto it for years to recover or make some money.
I also learned the hard way that I couldn't retire early buying and selling commodities like Ken Roberts was mentioning in his ads.
At one time, I was up a lot but like in Vegas, if you continue long enough, the dealer will take all your money. :'( That's why I don't gamble in Vegas.Most of my money is in stocks and I'm very comfortable with risky stocks but no tech stocks for me. You just have to find out what you're comfortable with. Hopefully, the lesson isn't too expensive like it was for me.
The Motor Court Company
Well-known member
card counting in blackjack
ps9 said:
irvinehusky said:Early on, I realized my financial sense of timing was not very good so I lost a good deal of money on options. Yes, I bought one of the option courses from one of the guys that used to come out on the financial news a lot.
With regular stocks (no shorting, etc.), even if my timing is off, if the company is still good and it doesn't go bankrupt, I can always hang onto it for years to recover or make some money.
I also learned the hard way that I couldn't retire early buying and selling commodities like Ken Roberts was mentioning in his ads.
Most of my money is in stocks and I'm very comfortable with risky stocks but no tech stocks for me. You just have to find out what you're comfortable with. Hopefully, the lesson isn't too expensive like it was for me.
So your 100% in stocks, no cash position? #veryaggresive
aquabliss
Well-known member
Guys I wouldn't suggest selling naked options, at least not until you've bought them for a long enough period of time that you can understand the risks. I used to play options almost daily, did good for awhile then lost it all + more. Tried some different strategies that didn't work, in part because of my impatience, but mostly because there's never any sure fire way to turn a profit easily.
I'm assuming what USC does (since it's less risky) is sell naked puts on large caps (on indexes) that have a few months (or longer) time horizon. This can probably make you money over time assuming a slow, steady increase of any given equity, but one big swing and you could be completely wiped out.
You can find different examples of this every day. Here's one for today:https://www.google.com/finance?q=NYSE:PIR
Pier One Imports stock down 24% in one day. If yesterday, I sold naked $14 strike June 2015 puts at .50c each, let's say I sold $5,000 dollars worth so yesterday my account was credited that amount. By end of today, I would owe $20,000 if those were to be called.
On the other hand, if I simply bought $5,000 worth of calls the investment would have significantly eroded, but I wouldn't owe any more than my initial investment.
I've seen even worse scenarios where a surge or large drop in stocks can impact the option price by 10/15/20 times. Can you imagine selling $10k worth of naked options and there is some huge catastrophy somewhere and you wake up owing $200,000.
I'm assuming what USC does (since it's less risky) is sell naked puts on large caps (on indexes) that have a few months (or longer) time horizon. This can probably make you money over time assuming a slow, steady increase of any given equity, but one big swing and you could be completely wiped out.
You can find different examples of this every day. Here's one for today:https://www.google.com/finance?q=NYSE:PIR
Pier One Imports stock down 24% in one day. If yesterday, I sold naked $14 strike June 2015 puts at .50c each, let's say I sold $5,000 dollars worth so yesterday my account was credited that amount. By end of today, I would owe $20,000 if those were to be called.
On the other hand, if I simply bought $5,000 worth of calls the investment would have significantly eroded, but I wouldn't owe any more than my initial investment.
I've seen even worse scenarios where a surge or large drop in stocks can impact the option price by 10/15/20 times. Can you imagine selling $10k worth of naked options and there is some huge catastrophy somewhere and you wake up owing $200,000.
ps99472
New member
aquabliss said:
I didn't understand a word you said... but thanks for sharing. As for me, I had to put in an "application" to my online brokerage Sharebuilder to enable the option to trade options. More like a survey of how much I own, my trading experience, etc. All stated, nothing backed up. Got approved later today with access to level 2 options trading.
Here's the difference between leve 1 and level 2:
What is the difference between Level 1 and Level 2 option trading?
Here?s a breakdown:
Level 1
A Level 1 options trader has the ability to place the following types of orders:
Write a Covered Call (sell to open)
Close a Covered Call (buy to close)
Perform a Buy / Write (buy a stock position and sell a call to open)
Perform an Unwind (sell a stock position and buy a call to close)
Level 2
Level 2 gives you more options (pun intended) to choose from:
All Level 1 strategies above, plus:
Buy a call (to open)
Buy a put (to open)
Sell a call (to close)
Sell a put (to close)
This should be fun..
usctrojancpa
Well-known member
You are correct, I mainly sell naked options on indexes including the VIX and VXX going both ways. I stick to what I know best. Have I taken losses when we had violent moves with big spikes in volatility? I did take 5 figure losses when I got stopped out in one day during the extreme spikes in volatility, but I use stop losses so I don't get steam rolled. Basically the goal is to squirrel enough premium away where you can more than absorb some loses. Luckily, I'll already pulled out the capital that I started and I'm playing with house money now. I've been able to outperform the indexes by a good bit since 2010. For me, selling naked options is like playing craps but I take some chips off the table every time the dice are friendly.aquabliss said:
