LDOS 02/18/2022 110.00 Call (unofficial play)

[Bob L]

I'll have to take a "deeper dive" into Unusual Whales. It might save some time and uncover hidden pearls. I'd like to have a higher probability system for short term option trades.

I've adapted Sol's approach which is basically to view options as a short term, possible high return investment. Changing my time horizon to 6 months has increased my success. I'm a chart reader and by technical analysis I can see that a stock is building for a move but pinpointing that move to this month or even next month can be a challenge. Within six months seems to work well. Even if the market corrects there's time for recovery.

Each gotta find their own way. Thanks for the info.

[AstuteShift]

I'll have to take a "deeper dive" into Unusual Whales. It might save some time and uncover hidden pearls. I'd like to have a higher probability system for short term option trades.

I've adapted Sol's approach which is basically to view options as a short term, possible high return investment. Changing my time horizon to 6 months has increased my success. I'm a chart reader and by technical analysis I can see that a stock is building for a move but pinpointing that move to this month or even next month can be a challenge. Within six months seems to work well. Even if the market corrects there's time for recovery.

Each gotta find their own way. Thanks for the info.

Indeed, this is adrenaline on steroids, I just keep the risk low and follow the rules. Sometimes also these whales, can give you clues on overall market state. Some individual was buying massive TLT calls for 9/2022 which makes it interesting since TLT is pulling back on the weekly and monthly is yet for a bullish crossover.

As traders, you always want to challenge yourself and not get complacent. Greatest video game on earth

[AstuteShift]

So far, doing this strategy has been very effective

Of course I had losers but they were small

What’s funny my big winners were index calls on IWM and SPY. These big boys were loading on a big buying spree before the FED meeting.

Also the rule to sell half on 100-150% saved me from greed. Since these options are less than 3 months the risk is a lot greater to lose.

[Centeron631]

Astueshift u have me a little confused unless i am not reading correctly

in one place i think i read u only commit 1-5% (i take it as ur committed investment money) into options and another that U pretty well trade only options and leveraged etf's. It seems that im missing something or misreading and hope u can clarify. thks.

[SOL]

Astueshift u have me a little confused unless i am not reading correctly

in one place i think i read u only commit 1-5% (i take it as ur committed investment money) into options and another that U pretty well trade only options and leveraged etf's. It seems that im missing something or misreading and hope u can clarify. thks.

Astute is using some of his profits and some of non profit money to play purchase options on simple ETF's like SPY and IWM. This can be done if one is willing to take the risk. I would move slowly with options. First paper trade and then start with longer tern options, not less than 6 months. Astute was using 3 month options and those are highly volatile.

Don't let despair set in if you find something that you don't understand or a strategy that sounds too complex. Remember everyone had to go through a learning curve and that curve entailed mental stress and losing dollars. There are no free meals. However, if you are patient you can learn from the mistakes others have made and reduce the mistakes you make and the money you lose by a significant margin. From a long term strategy and we demonstrated this in real-time, the best time to buy is when all hell is breaking loose or the markets have shed 10 to 15%. But you can't memorize this you need to see it for yourself, One way to do this is to keep a trading journal. Did you keep one in 2020. If not try to recall how you felt and write it down. Then look at past crashes on the weekly and monthly charts and you will be amazed at what you can spot if you look through all the disaster events the media pushed out.

[Centeron631]

to Sol Astute et al

to clarify the above discussion

I am referring to 2 comments by Astute one in this thread in 2022:

You must have a game plan
Percentage loss set (50% and sell for example)
Time limit set (3 months or less sell)
Portfolio portion, 1-5 percent of total portfolio into options


And another in another thread in fall 2021:
Astute: The option trading I do is pretty simple, go with strike prices 10-30% above the entry price and go long dated LEAPs if possible on the green safe plays
"after short term taxes and trading fees perform and performance is 150% most if not all trades are options and leveraged etf’s and crypto, . *Also love selling put spreads in the spx during pulbacks and collecting the premium"

Unless Astute has changed his game plan ( i respect Astute and using a lot of his discourse in my notes/journal) - Now as to Portfolio 1-5% perhaps the intent is the % of total Lot size (total of all 3 levels or less if preplans to only 1 or 2 levels) in the stock option he is talking about and not the total of Option dollar wise he invests into Options (in light of his Fall 2021 comments)? Also believe he or someone commented never spend more than would for the actual stock vs. other comments from others that they spend less - needs clarification.
As to Time Limit is in contradiction of his statement in Fall of 2021 using leaps if he means he is buying options now with only a 3 month time limit. thks PS hoping to learn from others' experiences

[AstuteShift]

The high risk option plays I still do, however that’s really for those who can handle the volatility. I do not recommend copying me on this lol

The Leaps I do still applies. Its a lot easier to manage. Put spreads on the big indexes also however I make sure to have proper risk management.

2021 was an ok year for me. I did under perform the index but made legendary gains from 2020. To me that’s fine, I know there will be more opportunities for legendary gains

I’ve been doing options since 2018 and always preferred them over stocks due to the incredible flexibility you have. Once you understand how it works then it’s not so scary

Several friends of mine exclusively only trade options however they’re apex predators. They win big and lose big also, however there winners are more than enough to cover the losses

@centeron
Stick with what makes you comfortable. Stocks are still incredible for killer gains

[outof thebox]

The high risk option plays I still do, however that’s really for those who can handle the volatility. I do not recommend copying me on this lol

The Leaps I do still applies. Its a lot easier to manage. Put spreads on the big indexes also however I make sure to have proper risk management.

2021 was an ok year for me. I did under perform the index but made legendary gains from 2020. To me that’s fine, I know there will be more opportunities for legendary gains

I’ve been doing options since 2018 and always preferred them over stocks due to the incredible flexibility you have. Once you understand how it works then it’s not so scary

Several friends of mine exclusively only trade options however they’re apex predators. They win big and lose big also, however there winners are more than enough to cover the losses

@centeron
Stick with what makes you comfortable. Stocks are still incredible for killer gains

Options are killer for gains and for losses. However if you are a disciplined trader your wins can outgun your losses. in 2021 my losing trades on option amounted to over 20K but my wins produced over 40K so net i was up 20K even though i lost more trades than I won. The idea is to win big. Options should only be done by those with experience and individuals that don't panic when they lose several trades in a row. At most I allocate 20% of my portfolio to options but only when the market is trading in an oversold area on the monthly charts.

[LoriPrecisely]

One screener I use is called unusual whales. You pay for it but you save time, great fisherman tool.

I was researching this tool. Do you still use it, and find it useful?

Here is a June 6 FB post on their page:
JUST IN:
Nancy Pelosi and husband have purchased 100 and 50 Apple, $AAPL, call options at $80 strike price, expiring 03/17/23 and 06/16/23.
Also Microsoft, $MSFT, 10 and 40 call options at $180 strike, expiring 06/16/23.
http://unusualwhales.com/i_am_the_senate

[jlhooter]

One screener I use is called unusual whales. You pay for it but you save time, great fisherman tool.

I was researching this tool. Do you still use it, and find it useful?

Here is a June 6 FB post on their page:
JUST IN:
Nancy Pelosi and husband have purchased 100 and 50 Apple, $AAPL, call options at $80 strike price, expiring 03/17/23 and 06/16/23.
Also Microsoft, $MSFT, 10 and 40 call options at $180 strike, expiring 06/16/23.
http://unusualwhales.com/i_am_the_senate

I like these plays. These are LEAPS with ~0.9 delta. Breakeven is 150 AAPL and 275 MSFT but they will most likely sell these back for a nice profit before they expire.

[LoriPrecisely]

One screener I use is called unusual whales. You pay for it but you save time, great fisherman tool.

I was researching this tool. Do you still use it, and find it useful?

Here is a June 6 FB post on their page:
JUST IN:
Nancy Pelosi and husband have purchased 100 and 50 Apple, $AAPL, call options at $80 strike price, expiring 03/17/23 and 06/16/23.
Also Microsoft, $MSFT, 10 and 40 call options at $180 strike, expiring 06/16/23.
http://unusualwhales.com/i_am_the_senate

I like these plays. These are LEAPS with ~0.9 delta. Breakeven is 150 AAPL and 275 MSFT but they will most likely sell these back for a nice profit before they expire.

I have not delved into LEAPs really, just the one for VALE that Sol suggested. I prefer the sooner expiring plays, one week to 2 months at most. With the volatility of the current market, it has been quite profitable to jump in and out of plays frequently.

Delta changes so frequently, just like the stock price does, I don't see how that indicates anything relevant. Maybe for Leaps it is different?

[jlhooter]

I was researching this tool. Do you still use it, and find it useful?

Here is a June 6 FB post on their page:
JUST IN:
Nancy Pelosi and husband have purchased 100 and 50 Apple, $AAPL, call options at $80 strike price, expiring 03/17/23 and 06/16/23.
Also Microsoft, $MSFT, 10 and 40 call options at $180 strike, expiring 06/16/23.
http://unusualwhales.com/i_am_the_senate

I like these plays. These are LEAPS with ~0.9 delta. Breakeven is 150 AAPL and 275 MSFT but they will most likely sell these back for a nice profit before they expire.

I have not delved into LEAPs really, just the one for VALE that Sol suggested. I prefer the sooner expiring plays, one week to 2 months at most. With the volatility of the current market, it has been quite profitable to jump in and out of plays frequently.

Delta changes so frequently, just like the stock price does, I don't see how that indicates anything relevant. Maybe for Leaps it is different?

Nancy and Paul bought deep ITM LEAPS which have long exp and delta approaching 1. A delta of 1 means that the option price moves $1 for a $1 change in the stock price. ITM options have >0.5 delta and as you approach exp while in the money you trend to a delta of 1. If your option remains deep ITM it will stay pretty close to where you started esp if the stock price continues to rise. Buying a LEAPS is like buying 100 shares (BUT not the same; look up why) for a much lower capital (remember they can be risky so be careful). Instead of Paul paying $14,500 for 100 AAPL he paid $7,000 leveraging AAPL's price movement. He wont wait till it expires; he will wait for some price movement and sell back the LEAPS. If AAPL goes to $155 delta will trend up and track the price even closer to 1 (I think it was 0.93 today). If delta moved to 0.95, Paul made $950 or 14% v. 7% if he owned the shares. I like AAPL for this option since it probably has a high probability of going up in the near to mid term.

Yes delta will change significantly as you approach exp and when OTM, but you should check for yourself since I am still learning this stuff.

[jlhooter]

To put my money where my mouth is, my real case play was/is the following:

May 20, 2022 I did the following
APPL
BTO Call
Jan 19, 2024
$50 Strike
$85.61 premium
delta (don't remember, but was ~0.9)
Stock price: ~$135

Today
Stock Price $147.04
Delta: 0.96
Premium: $97.85 (BID price; worst case; probably could get closer to $99 today)
Gain: 14.3% (v. 8.9% if I bought the stock)
560 days remaining, but I won't go below 180 days

From pure $$
Own Stock: 147-135 = $12/share gain
Own LEAPS: 97.85-85.61 = $12.24/share gain (because of delta very close to 1 I have a similar gain as if owning the stock outright)

[Yodean]

From pure $$
Own Stock: 147-135 = $12/share gain
Own LEAPS: 97.85-85.61 = $12.24/share gain (because of delta very close to 1 I have a similar gain as if owning the stock outright)

@ExcelNinja: was wondering, have you tried SCC'ing your LEAPS, and if so, what has your experience been?

[jlhooter]

From pure $$
Own Stock: 147-135 = $12/share gain
Own LEAPS: 97.85-85.61 = $12.24/share gain (because of delta very close to 1 I have a similar gain as if owning the stock outright)

@ExcelNinja: was wondering, have you tried SCC'ing your LEAPS, and if so, what has your experience been?

Yodean I know you like your TLAs, so you are talking about a PMCC (Poor Man's Covered Call or PWCC). I have to do it on margin and I don't fully understand margin or am interested in margin at this time. The only way I can do a PMCC is to setup a dual leg option called a diagonal spread (one to buy the LEAPS (long call) and one to sell call (SCC)). I prefer to do the legs separately and have not pursued with my broker at this time how to separate them.

But like you, I am very interested if anyone has done PMCCs and what their experience has been.