Comments for Option Trading - Iron Condors, Credit Spreads, Covered Calls, Butterfly and Calender Spreads

Comment on How To Roll A Covered Call by Dennis

Dennis — Thu, 09 Feb 2012 01:39:26 +0000

I’ve watched the video on the covered call senario. I think the math on the option #2 was correct. On option #4 it seems that instead of a $128 debit you have forgotten about the original credit you had of $98 when you first sold the call. This would lower the debit to about $30. Also I was wondering if you’d ever heard of the “stock replacement strategy” that a guy named Ron Ianieri talks about. Basically, you find a stock you like and instead of buying the stock you buy a 6 to 9 month call with a delta of 80-85, then sell a current month OTM call. The theory being that as the stock appreciates, the long call goes up almost in lock step and even if you get exercised on the short call you are still ahead. If it expires out of the money you write another call for the next month and so on. And if you think it is going the other way, buy a 3 to 4 month put w/ a 30 delta. I paper traded this once (without the put)without sucess and can’t remember what happened or even which stock it was. I guess I should keep records on my paper trading as well. I sounds intriging to me. I’m curious what you think. Thanks for the covered call info. I’ve had to make this decision several times usually opting to keep the stock. Now I have a few other options to think about.
Dennis

Comment on How To Roll A Covered Call by Yadao Patil

Yadao Patil — Wed, 08 Feb 2012 23:29:37 +0000

Excellent presentation. I enjoyed. Thanks

Comment on How To Roll A Covered Call by gary

gary — Wed, 08 Feb 2012 23:24:10 +0000

I would not buy additional on pullback to 49-50 since another resistance level is at 54,and more importantly the broader market at major supply for a week. I would buy back the call back and put a stop on LVS at a decent profit and wait for the market to show us direction and then look at these strategies to fold into with LVS.

Comment on How To Roll A Covered Call by Jim Loewen

Jim Loewen — Wed, 08 Feb 2012 22:10:56 +0000

You should fix the video. #2 is wrong, no? And I think it’s important to fix, because I think buying back the call and then immediately selling the stock should NEVER pay more than letting the call expire (option #1) and selling it that way. Right?

Comment on How To Roll A Covered Call by t swaim

t swaim — Wed, 08 Feb 2012 21:32:59 +0000

very good – informative.

Comment on Weekly Options Credit Spread Horror Story by Genius

Genius — Wed, 08 Feb 2012 16:22:06 +0000

Just be careful. I am reminded of a fellow who created a system last year to trade SPX weeklies. He would sell iron condors as far away from the money as he could as long as he made 1% on each side – so 2% minimum for the trade. He tested it and made money something like 30 weeks in a row. Then one week it went against him and he lost all he made and more.

Comment on Weekly Options Credit Spread Horror Story by Jerry Jones

Jerry Jones — Wed, 08 Feb 2012 02:05:24 +0000

SPX Implied volatility is 15.24% much less than NFLX!

Comment on Weekly Options Credit Spread Horror Story by Jerry Jones

Jerry Jones — Wed, 08 Feb 2012 01:59:10 +0000

NFLX implied volatility is like 61.65% very risky! I have had very good success trading SPX weekly credit spreads. My record so far is 10 wins and 0 loses. Last week my 1350/1355 credit spread expired worthless, I made $0.30 on that trade. This week I have 2 SPX put spreads 1280/1275 and 1315/1310. I brought in $0.30 for each credit spread. It’s not a lot of income but I think it’s decent income for a week.

Comment on Weekly Option Trade Setup by Jerry Jones

Jerry Jones — Wed, 08 Feb 2012 01:00:02 +0000

What’s up Billy? Did u buy back your 1350/1360 call spread or let them expire? I let mine expire worthless, but I was a little afraid Friday because the market rallied and the SPX got up to 1245. How many credit spreads do u put on every week? This week I got 2 put spreads on the 1275/1280 and the 1310/1315. I brought in $0.30 for each spread. How many credit spreads do u have this week Billy? Who is your broker? I use tradeking, their commissions are only $7.01 for SPX spreads, $5.63 to sell calls, and $4.95 to trade stocks. Goodluck!

Comment on Showing A Loss Before Expiration by Genius

Genius — Tue, 07 Feb 2012 16:48:19 +0000

RJ,
Not sure what you mean by over premium.