Option picks - place some of your option here

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Winner
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Option picks - place some of your option here

Post by Winner »

Buy BLK 135/115 put at $1.35 for January 2012.

Risky play and willing to lost $25 for AAPL expire tomorrow for thousands % or nothing:
Buttlerfly (BUY/SELL/BUY) PUT 375/370/365 strike for $.05 (current at $.09) with 5/10/5 contracts for a total cost of $25 for potential gain of 9,900% or $2,500 if AAPL drop back to $370.

New trade TLT expire tomorrow
Buy CALL 17/18 for $.44 and sell PUT 17/16 for $.36 for a total cost of $.08
“A brave man knows the circumstances and consequences of what he may encounter ahead…..but moves forward anyway.”


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Winner
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Re: Option picks - place some of your option here

Post by Winner »

I have most of my cash in with BLK, otherwise I will be ALL-IN for the win/win trade
Call on C $24/28 strike for Dec 17 at $2.55 or breakeven as $26.55 while C is currently trading a $26.92 (that is $.37 profit for head start) for potential up to 56% profit in two weeks. You can't buy stock for less than the current trading.

Yahoo BID reported in work is a perfect candidate to trade for monthly income.
Volume: 151K CALL vs 86K PUT for Dec 17
Sell PUT 14/15 strike for $.14 for 16% profit (breakeven at $13.86)
currently trade at $16.24.
“A brave man knows the circumstances and consequences of what he may encounter ahead…..but moves forward anyway.”


skiehawk11
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Re: Option picks - place some of your option here

Post by skiehawk11 »

I hoping my call writes don't get called since it looks like the unemployment data is giving a helping hand to extend the market gains.

I need to work on timing my option entries I think.

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flight23
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Re: Option picks - place some of your option here

Post by flight23 »

I dont think your call writes can just get called at any point... only on expiration day, correct?
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skiehawk11
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Re: Option picks - place some of your option here

Post by skiehawk11 »

I believe those would be European style options. They can only be called at the expiration day. I think that applies to index futures and not etfs.

I believe the options I bought are American style which means they can get called at any time. This is in my virtual account so I am learning. I haven't lost real or virtual money yet.

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Winner
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Re: Option picks - place some of your option here

Post by Winner »

I trade American style as well.

Contrarian play
Bought butterfly TZA Dec 27/33/39 for debit of $.81 for potential 641%.

"Hope and optimism:
Monday 5th
Angela Merkel and French President Nicolas Sarkozy will present a plan to create a "stability union" after they meet in Paris.
Wednesday 7th
The Greek Parliament votes on its 2012 budget, the budget is expected to pass without issue. It will include new austerity and growth measures aimed at bringing Greek debt under control.
Must pass in order to receive the next tranche of €8 billion ($11 billion) in EC/ECB/IMF aid. Almost a given it will go through.
Thursday 8th
The European Central Bank (ECB) will announce its second policy rate decision under the leadership of President Mario Draghi.
ECB members have alluded to cutting rates potential in December, which would follow the surprise rate cut in November. Watch closely to see if Draghi changes his stance on ECB involvement in the euro crisis and potentially purchase sovereign debt. As we know, The ECB has refused to these necessary measures because they believe it is not the job of a central banker. This would spark a sizable rally.
Friday the 9th
This could be the biggest day of the week and the world is watching Friday. EU leaders will meet at a summit in Brussels. The ECB's policy decision will weigh HEAVLY on the markets because a lot of hope is riding on this meeting for finding a solution for the eurozone."
“A brave man knows the circumstances and consequences of what he may encounter ahead…..but moves forward anyway.”

skiehawk11
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Re: Option picks - place some of your option here

Post by skiehawk11 »

Thank s Winner. As always thanks for the insight. So far I am still OTM on all my options. However, I could see a loss on some if there is a good uptick if the ECb buys soverign debt.

skiehawk11
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Re: Option picks - place some of your option here

Post by skiehawk11 »

Buy: AAPL Dec11 405 Call
Sell: AAPL Dec11 410 Call
Sell: AAPL Dec11 360 Put
Buy: AAPL Dec11 365 Put


Quick question:
My iron condor is doing good so far.
Buy: AAPL Dec11 365 Put cost me 870 dollars
I can sell for 1490 right now for 41.6% profit. Should I?

Edit: It's a a beginner question, but say I sold a call and collected a premium. If I buy back for profit do I have to repay the premium? If so to buy back for a profit, it would have to be enough to cover the amount the premium was worth plus fees and taxes correct?

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Winner
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Re: Option picks - place some of your option here

Post by Winner »

If you sell $365, then you have to buy back $360 strike as well by trade them in a pair or you need a margin of $36K per contract for put. For me personal I will hold on the PUT, unless I need to free the margin to buy another and usually take profit in the last few days for a pair will cost aroun $.05 to $.50. for out of the money. Each day went by for the timeline you gain approx. $100 a day for the $870. Just set your own limit how much you are willing to risk vs profit. How often you trade stocks and gain that amount in any single trade?

I'm not sure your question related to a call & collected premium. You don't pay taxes until you file your income tax. I'm a little greedy as I try to collect at least 5X above the commission for any trades or lost no more than 5% of my entire balance on any trades, usually risk and out between 2% to 3%*. Aim for profit at least 100% and will collect less if to much volatite, but never think about taxes. If I have to pay taxes at the end of the year that translate I did very well for that year. So far this year I paid over $6K in commission fees. I'm swing trades and currently have 6 open. Most of the time with at least three open and up to 15 open trades (usually the last week of the month). Most of my trades between $500 to $1K and if I gain several hundred % on one of my trade, then I'm willing to trade some high risk that a total cost up to $100 for potential several thousand % to unlimitted (just like risk $25 last week on AAPL).

Today bought Dec11 with 9 days to go:
10 contracts of YHOO PUT at $14 strike for $.04 for a total cost of $40.
and TIF CAll $65/67.5 spread for $1.60 for max profit of $.90 or 56.25% for breakeven at $66.60 -Last trade at $68.75 (This is the type of trades that I use 15% of my entire balance and sometime more up to 100% since this is less risk as it's currently trade ITM (in the money) and $2.15 above the breakeven). This is the time of trade that I consider for monthly income as I'm in below the breakeven point within two week of expiration and higher return/more than 50%. There is another way I could profit more by sell PUT $65 strike for $1 to reduce my cost to $.60 breakeven at $65.60 or more risk sell of margin exercise below $67.5 strike for $1.90 or $.30 credit for the max of $2.80 if it trade above $67.5 for the breakeven at $64.70.

*Example $10K in the account use up to 15% for any single option trade or $1.5K.
-Maximum risk 5% or $500.
-Usually out when lost between $200-$300 or 2%-3% of the entire account balance. Most of my trades are OTM use less than 2% of the balance and willing to risk it all for max reward such as FAS/FAZ/TNA/TZA.
“A brave man knows the circumstances and consequences of what he may encounter ahead…..but moves forward anyway.”

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Winner
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Re: Option picks - place some of your option here

Post by Winner »

Bought
PUT - DE, WYNN & ACI
CALL - DRI
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flight23
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Re: Option picks - place some of your option here

Post by flight23 »

Lets say there will be a big move in one direction or the other on Friday... what would be the best options strategy to take advantage of that? Is there any way to have a low cost trade to profit only if the S&P moves >15-20 points?
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Winner
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Re: Option picks - place some of your option here

Post by Winner »

flight23 wrote:Lets say there will be a big move in one direction or the other on Friday... what would be the best options strategy to take advantage of that??

STRADDLE (buy call & put at the same time) is best for volatility. GLD for Jan.
Iron Condor and Butterfly Condor with net Debit for low cost, but minimize your profit as well.

Based on yahoo buyout rumor is potential volatile stock as every 1 put buy at 14 strike there are 2 call at 18 strike for Dec 17 expiration. More than 15K contracts exchange hand on this stock. So far, I bought only Put based on insider trading as two weeks ago, Chief Yahoo, David Filo, sold about US$5.5 million stocks at price of US$14.98. .

flight23 wrote:Is there any way to have a low cost trade to profit only if the S&P moves >15-20 points?

Butterfly Condor with net credit work well for less volatility stocks and require margin. The last time I use this strategy was on BBY after Qtr Earning for this year.

All of this trades are in the money (ITM) for maximize profit. Based on yahoo buyout rumor I bought both put 14 strike and will buy call 18 strike.
“A brave man knows the circumstances and consequences of what he may encounter ahead…..but moves forward anyway.”

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flight23
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Re: Option picks - place some of your option here

Post by flight23 »

Someone posted this on Twitter, winner whats your take on it?
jan/dec BAC 6 long calendar .27 bid to bid; feb / jan BAC 6 calendar only .10... opportunity is there for those paying attention
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