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Filter Exchange · ,maxreturn your totally clueless-the only maxreturn is your idiot mouth
gmg733
msg #85873
1/9/2010 1:05:54 PM

M4M,

Keep up the good work. I know I'm liking what I see. Between you and TRO, my trading success has gone up tremendously.

Regards,

gmg733

General Discussion · 2-Period RSI trades with ETFs -- Using Options
gmg733
msg #109745
12/31/2012 10:25:55 PM

What guidance do you seek?

General Discussion · 2-Period RSI trades with ETFs -- Using Options
gmg733
msg #109797
1/2/2013 1:55:11 PM

Options are a complicated topic. What is the goal first. Are you looking to hedge, pure leverage, etc?

Since you have a 4 day hold time, you have some options. If you wanted to sell weeklys you could do that and get some good bang. Or you could buy naked calls/puts or you could do spreads. Since you have such a short hold time, I wouldn't recommend weekly options for the naked leverage play. Theta would eat you alive. Hence why the first strategy I mentioned is profitable. Then you could do delta neutral (popular with institution buyers) where you net position delta is zero. You can make money if it goes up or down. So you would be long/short an equity position and long an options instrument to offset the equity position delta.

As you can see, there is no real cut and dry answer to the question. In my opinion, if you have a trigger at $55 and are sure it is going up or at worst sideways, then sell weekly options. I don't like naked options unless you are day trading. Most folks mismanage Theta and don't know who to make respectable returns with longer dated options.

Lastly, what further options most are is a play on volatility. You can be 100% right on a trade and lose money.

Keep in mind options were originally designed as hedging vehicles. I would start using them as such until you get the hang of it.

General Discussion · 2-Period RSI trades with ETFs -- Using Options
gmg733
msg #109811
modified
1/2/2013 5:02:27 PM

If you are simply trying to eliminate overnight risk, you could hold the underlying and sell a covered option. You could do this everyday before close, but commissions would add up quick. And since you are hedged, you'd have a more limited upside from a profit perspective. I'd have to model this as I don't trade much weeklys, but it may be applicable here.

If you were day trading, I'd recommend naked intraday, but with a 4 day hold you get caught in a limbo where you start to give up reward in lieu of risk. For instance, I never buy an option 14 days until expiry, but if I buy them too far out they I'd don't get a lot of gamma on my side. Sure I get theta, but that may not be the trade I am in.

Lastly, I don't know if I was clear, but trading options for me became more clear when I started trading in terms of the greeks and not the underlying. I could have an upside bias, but how did I want to trade that. Was I looking for a gamma movement. Was I wanting to play it as theta decay. Etc.



General Discussion · 2-Period RSI trades with ETFs -- Using Options
gmg733
msg #109824
modified
1/3/2013 9:52:51 AM

With an average hold time of 4 days, I don't think I would be looking at weeklys for long positions especially not hedged. Theta will kill you. And depending on time, front month will kill you as well.

Hence, as most of the advice here has been 'it depends' and only trade options if you know what you are doing.

Regards!

General Discussion · 2-Period RSI trades with ETFs -- Using Options
gmg733
msg #109965
1/8/2013 12:11:38 PM

If you want to go naked, go the other way. Out of the money you will have a very defined risk, benefit from gamma and you're theta will be close to the In the money equivalent and you won't have nearly the delta exposure.

General Discussion · 2008 redux and your version of Market Timing?
gmg733
msg #134389
2/18/2017 10:55:13 AM

There are a couple ways to time it. Here is one http://stockcharts.com/public/1107832/tenpp/5 on charts 57

I also watched the monthly moving averages from mebane faber work which can be found here https://www.advisorperspectives.com/dshort/updates/2017/01/31/moving-averages-january-month-end-update

This are more in market or out of market methologies. I am a big advocate of winning by not losing.

General Discussion · 401(k) documentary ruffles feathers
gmg733
msg #113006
4/27/2013 3:54:03 PM

I look at it from a different perspective. I need to build core capital that will facilitate my income come retirement. I concerned with having equity that will make me money, not the money itself.

I ask folks all the time how much their broker charges them every year. They say $40. I laugh. The public does not know they are fleeced by fees and they rarely are called out in any statement.

This is truly said. I have however fired every broker I had and I do it all myself.

General Discussion · 401(k) documentary ruffles feathers
gmg733
msg #113022
4/28/2013 6:10:43 PM

@Mac

Your fund is up 7% YTD with an expense of .6%
MDY benchmark is up 13% YTD with an expense of .25%



Filter Exchange · 5% A WEEK FILTER (BASED ON TRO'S CROCK POT)
gmg733
msg #85182
12/29/2009 3:19:45 PM

Kevin,

Maybe a good addition to your approach would be to look at W%R to see if the stock is overbought/oversold. I know that positions can be overbought/sold for extended periods, but it may be enough to tilt the odds in your favor in a sideways environment.

Just a thought.

gmg733

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