Any Options traders here ?

[WorldNumberOne]

Would love to have a thread to discuss .

I am wanting to learn the ropes .

 

[Hitman26]

I trade them heavily. I would recommend "Options as a Strategic Investment" by L. McMillian to educate yourself properly.

 

[WorldNumberOne]

I trade them heavily. I would recommend "Options as a Strategic Investment" by L. McMillian to educate yourself properly.

i'll check it out .

how many contracts do you normally trade on one deal ?

 

[Hitman26]

Last year I traded as little as 2 and as much as 80. My average is probably 20 contracts per trade. I sell options much more than I buy them. Monday I bought some Monsanto call options for 1.7 per contract (april 80 calls), Tuesday afternoon at the close they were worth 85 cents per contract. In 24 hours I lost 50%!!! That's why when I buy options, I normally will only buy 1% of my total bankroll on a trade because when buying options, especially out of the money, the odds are pretty good they will expire worthless.

 

[WorldNumberOne]

Last year I traded as little as 2 and as much as 80. My average is probably 20 contracts per trade. I sell options much more than I buy them. Monday I bought some Monsanto call options for 1.7 per contract (april 80 calls), Tuesday afternoon at the close they were worth 85 cents per contract. In 24 hours I lost 50%!!! That's why when I buy options, I normally will only buy 1% of my total bankroll on a trade because when buying options, especially out of the money, the odds are pretty good they will expire worthless.

a contract would be $ 1.70 x 100 , correct ? so you had lost $ 850 in 24 hours.. right ?

 

[Hitman26]

1.7 * 100 is right. Each contract is 100 shares.

 

[jageshpatel]

n e tips

i just got into 2 this morning slef...i play options almost daily but moe so long term one....4-9 months out...

bought MU (micron tech) 12.50 jan 2012 calls and mgm (mgm) 15.00's for jan 2012 as well.....

not to heavy 5-20 contracts a trade is my avg

n e one got n e good leads/tips on n e

 

[WorldNumberOne]

1.7 * 100 is right. Each contract is 100 shares.

how often are you buying spreads ? or do you usually just buy a call or a put ?

spreads seem like the best way to manage risk while as the same time capping the gain i suppose .

 

[Hitman26]

I use spreads rarely starting out. I often turn winning trades into spreads if I want to reduce risk. My best trades are selling naked options and most of the time naked puts on stocks I wouldn't mind owning. I try to hit a lot of singles. I also sell tons of covered calls on stocks that I own.

 

[WorldNumberOne]

I use spreads rarely starting out. I often turn winning trades into spreads if I want to reduce risk. My best trades are selling naked options and most of the time naked puts on stocks I wouldn't mind owning. I try to hit a lot of singles. I also sell tons of covered calls on stocks that I own.

one would need at least $ 100,000 to play the types of games your playing , right ? a margin call could happen very easily , right ?

 

[Hitman26]

Yes.

 

[TerryDurrence]

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