Trade of the day
Well it seems I have quite a good thing going on. Just for fun I’ll post what I consider to be the best trade I did on a given day.
Today was selling cash secured puts, GE December 15 for .72 to open. Easy money and if GE gets to 15 I'll take it with a 14.28 basis that should also make the dividend in the 8% range.Forgot to add there is an 82% probability that this will expire worthless. We do want the stock, but if not we get paid to be wrong.
Would you be pissed if GE opens at $2.625?
If something like that happens I would ‘roll’ it. There is plenty of chain for profit management. So no not really would just manage the position. Was 48 for 48 profitable expirations last month. My system was crash tested and all was well. Will have 70 something this month.
I see… you SOLD the puts. I misread your original post to say that you BOUGHT them. My bad.
Altria cash secured put MO Dec 17 1/2 for 1.26, Hope/planning to get the stock on this one. Don’t see asians stopping smoking anytime soon with a 16.24 the div will be above 7.5%
FYI All funds used for cash secured puts are put in TBills until expiration. If I buy back the option I just leave the cash in TBill as it’s considered cash by margin.
How about buying CHK at 22.36 and writing the Jan 09 calls at 27.50 for 2. Pocket the $200 and get called away with a 23% profit. You also will get the divi from the stock.
With Obama becoming prez, you could do this all year long while owning a nat gas company, which is a form of energy he supports.Not on My radar but I’ll check it out. I trade overwrites all the time. Not a lot of premium on the call side for the last month or so that one sounds very nice.
I can't tell these guys how proud I am to know that there are still smart guys around who are not afraid to suggest "zany options trades" to their clients.
You guys make me and my mentor LeRoy Gross proud.
[quote=Provocative Put]
I can't tell these guys how proud I am to know that there are still smart guys around who are not afraid to suggest "zany options trades" to their clients.
You guys make me and my mentor LeRoy Gross proud.
[/quote] I thought you hated me...I have never used options before(frmr EDJ) where is a good place to start to learn how to, so I can add it to my business…
Prov,
Zany? I guess your not a fan of probabilities and getting high quality dividend paying stock at a discount.[quote=Gaddock]Prov,
Zany? I guess your not a fan of probabilities and getting high quality dividend paying stock at a discount.[/quote] Gad, I think you read his comment a little too quick. He actually thinks what you're doing is the best thing since sliced bread. I do, however, think "zany" was an odd choice for an adjective in his sentence, which might have been what threw you off.Beyond that these "zany" trades are appropriate for errisa account... yawn.
Trade of the day ... Bought back a APA Nov. 95 for .15 from .95 to close. Yes I know it expires a week from Friday, I needed the margin to free up some cash.
Snags thanks for the clarification, please dont take what I said as negative.
Covered Calls, if you can find any premium. Dont go for the big credits and try to keep the delta in the 90's, above overhead resistance and three standard deviations on the strike price. Dont go out beyond 60 days for the most part as the time value drops off quick (your best friend). Be sure it's a price your client would be happy to sell the stock for as well.I have never used options before(frmr EDJ) where is a good place to start to learn how to, so I can add it to my business…
Prov,
When you speak of LeRoy Gross are you speaking of the man or his books?[quote=Gaddock]
Prov,
[/quote]
Both. The man could sell ice to eskimos, or is it eskimoes?
[quote=Provocative Put] [quote=Gaddock]
Prov,
[/quote]
Both. The man could sell ice to eskimos, or is it eskimoes?
[/quote] Not to mention sand to the sand man, ice to the ice man ,and pussy to the Navy. Leroy was the man!
Sold Dec. GE 12.50 Puts w/.82 at the end of the day yesterday. Was looking for my checkbook earlier this morning, but feeling pretty good about it right now.
STT Nov 30 for .60, not bad for thre days. Met had some huge last minute premium as well as GS & MS but the STT has a 96% probability of expiring out of the $$
Here’s a trade that seems almost too good to be true.
Buy RIMM at 45.70 and write a December 45 Straddle for 12.50.
If the stock remains where it is, or goes higher the gain will be 11.80
on an investment of 33.20–about 35% between now and Dec 19.
The downside is that you end up owning additional RIMM at
32.50–average cost will be less than 40 in new shares bought if the
put is exercised plus those bought at this time to cover the call.
Plus, if it’s down next month just roll the entire position to
January. If you’re catching 12 points of time value per
month it won’t take long to collect enough to pay for the shares.
Blackberrys are not going to disappear and RIMM seems capable of
staying on the leading edge of the technology. The PE ratio is
15, but hell we’re in “The New Economy.” What was the PE ratio of
JDS Uniphase, or how about that sock puppet pet food seller?
Just a zany idea from your pal Put Trader.
[quote=Gaddock]
STT Nov 30 for .60, not bad for thre days. Met had some huge last minute premium as well as GS & MS but the STT has a 96% probability of expiring out of the $$
[/quote]Gadd…how are you deriving the probability of expiration that you cite…
It’s the inverse of the hedge ratio (delta)
I did so many today it’s hard to say what was the best. So putting the screws market maker was the high point of the day. I had 249 of 500 call contracts (149 were Jan 10 2.50 and 100 Jan 9 2.50’s all pre reverse split TMA) Anytime I put more than a few contracts he would raise the ask to .10 or even .15. Since they were sold for .20 and .35 and dont trade on the penny I didnt want to pay more than a nickle for the buy ro close.
So I had two FA's (We are still FC's) get the orders ready to be put in on two diff machines. I locked the market on the Jan 5's by selling and buying one contract from the same location at the same time, all or nothing so it didnt even show on the tape and the second the market was locked I had both of them enter the two orders at the same moment. I got a fill on all 249 for a nickle. If I put the screws to him in the confusion real or imagined I laughed me arse off for a good 20 mins.Looked like I had a clean sweep for Nov expirations … today rolled 8 positions but the option chains were all wacked out. On all but one I rolled out of harms way and did so with a credit. Never thought I would see that on a one month roll. Trade of the day had to be the GS Nov 50 roll to Dec 40 and got additional 2.80 per share and 10K less liability. Holy crap you have to be quick on the draw these days. Got .90 on a MS 10 Nov to a Dec 7 1/2 as well.
No, sure dont.
This isn’t options but picked up SD at 5.16 yesterday when all the natural gas and energy stocks went down(also picked up chk & btu). SD closed at 7.71… 49% increase…
Good trade … CRAZY DAY I rolled position after position all with a credit, never seen anything like it. It was like getting into new positions with a lower strike price AND GETTING PAID … what the hell iks going on ??? I dont get it but it works for me.
The IV spikes were huge this morning. If I had to read the tea leaves I would say more people than not are getting ready for the rubber band to break.
Got in on C at 3.45 under the impression that it was too big and more importantly too global to fail.. premarket trading has it at $5.75.. nice bump.. I like Bove's price outlook of $9 and that was before the gov't endorsement.. Lost my nice dividend but just gained 50% so I will take the switch
The C trade looking better every day... now up over 50%
[quote=Squash1]
The C trade looking better every day... now up over 50%
[/quote] I believe Mr. Steve Miller himself said it best, "Go on, take the money and run..."You got to love this volatility!! I know my clients are. When the market is moving, someone is making money! Hahahaha!!!
Buying yield .... HOG Dec 15's for 1.60. At Hog's current yield picking it up with a basis of 13.40 puts the yield in the 9% area, It's on our DSIP focus list so I feel pretty good about its capacity to continue the divs. If I dont get it we got paid for being wrong. If we do I write a covered call as soon as we've been asigned.
RISKY RISKY RISKY
Sold Jan Puts 2 1/2's on GM for $1. Yep good chance on eating this one but GM stock with a 1.50 basis isnt such a bad thing .... maybe. If it expires out of the money the annual return is 480% in a month and 1/2.lol @ “eating this one”.
The premiums are ridiculuous if you are willing to take a shot. Other than your posts, the thing that spurred my interest in writing more puts was the day in late Oct/early NOV when HIG gapped open and traded down to about 9, and the HIG NOV 10 Puts were trading at 4 with 3 weeks left. Nuts.
Happy writing! Be careful that you don’t get carried away!
“Be careful that you don’t get carried away!”
LOLOLOL Amen to that! look at the GS chain a few days before expiration!!!Rich indeed!
Bought back Puts MS Jan 7 1/2 's for .65 from 1.85 to close.
WARNING ??? TROUBLE FOR US AGERS AGAIN???
The options chain for WFC opened up down to 2 1/2 today.Saw the IV spike the thursday before Kuwait told DOW to f- off. Solf ROH Jan 45’s for just under $6. Bought it back for .90.
Maybe best of 09 all things considered.
Sold puts on GM, MP's Jan 2 1/2's. It was selling volatility (vs. buying yield) but the risk to reward was huge. I sold them for 1.10 and got them back today for pennies. Even a small account could pick up 10 contracts and the worste possible would be GM stock at 1.40 a share. Keep your eyes on the IV, it's the last frontier for elephant tracks.67 expirations 66 out of the mnoney. The one that I bought back was a WB 5 put the converted to WFC with a bit of cash Since the strike price doesnt change these days no room or premium to roll it. No biggy. It was a complete slaughter. Already lined up for Feb. GOD I love this strategy.
As an aside, I flew up to NYC for an apt. I was on standbye for the plane that went down. It would appear I've an Angel on my shoulder.[quote=Gaddock]
67 expirations 66 out of the mnoney. The one that I bought back was a WB 5 put the converted to WFC with a bit of cash Since the strike price doesnt change these days no room or premium to roll it. No biggy. It was a complete slaughter. Already lined up for Feb. GOD I love this strategy.
As an aside, I flew up to NYC for an apt. I was on standbye for the plane that went down. It would appear I've an Angel on my shoulder. [/quote]I thought about you, as soon as I found out.
Gaddock, do you realize that you are posting specific investment advice on a public forum? Trading options on the B/D you work for? Do you not like your license? You seem like an intelligent guy, so this entire thread seems odd.
On that note, if you know how to follow IV you can find some great last minute credits. Example: If one were able to do so one could have sold JPM jan 20’s for .32 last Wednesday with only two (actually three) days until expiration. Hedge Ratio was 0 implying a 100% probability of expiration at or out of the money. ROH was still selling for the .60 range.
Don't try this at home kids.[quote=Gaddock]
How do you figure that talking about strategy and trades that are past tense to be specific investment advice? Not one trade I've described could have been filled as described by the time I used it as an example. Never considered it as any advice at all. I will ask compliance if that is the case.[/quote] You're going to ask compliance if posting past trades on a public message board is ok? POSTING is a reason to terminate you. By posting the exact trades, even after the fact, plus what firm you are with, makes it quite easy to identify you. Do what you want, but you should think this out a bit more.Source URL:https://www.wealthmanagement.com/forums/lounge/trade-day