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Teddi KnightKeymaster
Thomas: Very educational. Thank you for posting the follow up.
Teddi KnightKeymasterAnother update on my trade.
Needless to say, the stock has not performed well. This morning I closed 5 of the 10 contracts of the spread that expires today. Here is the closing trade:
BTC 5 Feb 6th $90 puts at $3.08
STC 5 Feb 6th $85 puts at $0.04Net Debit $3.04
This afternoon I rolled out on 5 contracts. Here is the trade:
BTO 5 Mar 27th $90 puts at $1.62
STO 5 Mar 20th $80 puts at $6.20Net credit = $4.58
The net credit for the roll out is $1.54. My cost basis on those 5 contracts now stands at $87.85. I will likely keep rolling out those 5 contracts at the $90 strike as long as it is profitable or expires. Again, I spaced the long leg and short leg expiration dates by a week.
I will take assignment of the other 5 contracts and plan to sell the July 17th $85 calls for about $8.00. My cost basis on these 500 shares would then be about $81.39. If called, I would make a $3.61 gain. If not called, I will continue to sell near the money calls until the shares are called away.
My total capital at risk is $50,000. I decided to take assignment of only half of the original trade and roll the other half in order to keep my capital in the trade lower.
You can see why this was a speculative trade. But I feel I am in a decent position to manage the trade and ultimately keep it profitable, albeit not a great profit.
Teddi KnightKeymasterReady, fire, aim…! Stock sold off another $1 near the close along with most everything else. Could have done the same trade for 1.75 premium before the close.
Teddi KnightKeymasterThanks for the analysis
Teddi KnightKeymasterWow, thank you so much for sharing this. I never knew I could add things into IB like this. Definitely a helpful tool for any IB users doing shorter term trading such as pennies or market direction trades.
Teddi KnightKeymasterSome 3x/-3x ETFs:
Dow 30: UDOW (3x), SDOW (-3x)
S&P 500: UPRO (3x), SPXU (-3x)
Russell 2000: URTY (3x), SRTY (-3x)
NASDAQ 100: TQQQ (3x), SQQQ (-3x)Teddi KnightKeymasterSorry. $33 strike
Like you, i have bought calls around $31 and sold calls around $33 with some syccess. I have held pfizer since 2011Teddi KnightKeymasterHi Dizzle,
IB charts are pretty annoying for me to use in general.
I do not know your capital constraints, but one option would be to move $3,500 to TD and start a Think or Swim account. (little to no annual fees) I use think or swim for analysis and IB for entering/exiting positions.
IB charting isn’t the best, but they have top-notch commission prices and offers nearly every product imaginable. ToS has robust, easy to use software that i find to be second to none. The combo works very well for me.
Yes, as pointed out IB customer service is AWFUL. Teddi makes a good point about how worthwile the cheap rates are. They will help in major events of course, but technical/software things like stochastic settings, good luck! The best method for me to contact them has typically been the live chat. Sometimes you have to try a couple times to get someone good. I would not recommend IB to anyone unless they feel highly competent in trading and investing products.
Ninja Trader is another analysis platform I use sometimes. It is a bit confusing, but you can get live quotes running with fast stochastic customized how you like for free.
Stockcharts.com is another good option but that would be around $25/month.
Just wanted to give you some alternative options.
If you ever have other technical questions about IB or ToS feel free to ask.Teddi KnightKeymasterGlad this article did not slip through the cracks for me. Great read.
I think XOM is in a great position for selling put/put spreads when it hits the lower bollinger band on the daily. Crude looks like it is starting to find a bottom on longer term chart . (CRUDE WEEKLY CHART)
Looking at XOM on daily you can see that selling puts at the lower BB has been pretty good the past 2 months. The increased volatility lately in oil companies should make it easier to find acceptable profits at strikes a little further out/safer than normal.
Attachments:
You must be logged in to view attached files.Teddi KnightKeymasterCorrection, I sold the 96 put, not the 95. Other info is correct.
Teddi KnightKeymasterThank you UBS for the downgrade. At 1:16 pm with GILD at about 98.36.
STO 3 Feb 20 95 puts@ 1.15.
Teddi KnightKeymasterNearly 2% pullback for YUM today, selling more calls was a great idea! I ended up closing the position for about 70% of max gain, but I sold some calls on paper when YUM hit $75 yesterday and its working great so far. Thanks for your insights as always, I guess I should listen better :)
BTW, I did an earnings IC position on EXPE yesterday with a similar type of setup as the YUM trade(sell far otm spreads). Even with an 11.35% drop I was able to scrap out at with a tiny profit. EXPE looks like a pretty strong and stable company, but is not in my list so I went against my plan >:x
However, it is nice to see that with rescue/repair strategies even a 12% move against me can be survived if the underlying company is strong. I am going to start skewing the trades with more upside protection since downside moves seem to be easier to repair.
Teddi KnightKeymasterHere is my view of Intel Stock at present https://www.fullyinformed.com/members/investing-strategy-notes-and-3-trade-ideas-before-the-markets-open-feb-6-2015/
Basically I think there are better candidates. I like to stack the odds of success in my favor. I think the time to enter Intel was two days ago but again, just my opinion.Teddi KnightKeymasterI noticed Audrey and Pass_lake have mentioned INTC as a potential BB trade. I was scanning my charts tonite and noticed it as well. I’ve attached a chart. Some observations:
1) Moving sideways to up the last two days after riding the BB down for 5 days.
2) Ult Osc was climbing, but pointing down at the close today.
3) Stochastic pointing up, coming off oversold condition
4) Momentum negative but flat; maybe turning?
5) MACD negative but definitely turning up
6) Volume dropping the past 3 days; would rather see it picking up.Any further thoughts?
Cheers,
KevinAttachments:
You must be logged in to view attached files.Teddi KnightKeymasterMe too, hit 80% return on my Feb 20 puts and closed.
Teddi KnightKeymasterClosed all my NUE puts this afternoon. Volatility could still be huge between now and the 19th. Might get it again. If not, made decent money which is never a bad thing, and I had a ton of puts, all the way out to March!
Teddi KnightKeymasterAgreed. I also have oasis petroleum, oaks. Cost basis is $49. Currently $18.70.
I can’t seem to find a place to sell a covered call, so I am holding. There is also takeover talk, so I don’t want to be on the wrong side of a takeover bidTeddi KnightKeymasterI am down quite a bit on 2300 shares of SDRL myself. Like you I had averaged down, sold calls but with this volatility I am just holding. I look at this investment like a rental property, sometimes I can rent it, sometimes not.
Teddi KnightKeymasterThis is possibly a good time to buy Intc stock ($33.78 today).
I have April $40 covered callsTeddi KnightKeymasterI watch for tight opening/closings and extreme volume dryup at bottoms. This follows the William O’Neill CANSLIM approach
Teddi KnightKeymaster2/5 @ 1:00 pm MRK @ 58.67:
STO 4 x Mar 6 57 puts @ 0.68
Teddi KnightKeymasterTeddi, I may be wrong, but reading the profiles of SDOW and UDOW it says they are both 3X ETF’s. Links below:
https://www.proshares.com/funds/sdow.html
https://www.proshares.com/funds/udow.htmlFeb 5 2015 at 7:28 am in reply to: Right time to roll Procter and Gamble Stock (PG Stock) / Buy stocks #16116Teddi KnightKeymasterThank you for the kind comment.
My decision to sell 82.5’s on 1/30 was a combination of reasons. There is a line of support btw 82-84 in Sep-Oct and a gap up across 84 that began the last uptrend. The 200 ema is also in the vicinity of 84. When the stock price fell to that region I surmised it should find some support. Also, 1/30 was the 3rd day out of 4 with very heavy volume and a Friday last day of the month. For a premier stock like PG I expected a rally at some point and felt it might happen on the first few days of a new month when fresh IRA/401k money gets put to work by the pros.
As regards closing the 87.5s, actually I was anticipating a stronger rally in PG. My target for closing was a test of the initial gap down around 87, but when it got to 86.4 yesterday and the premium differential btw the 2 positions offset my loss with a modest credit I decided to close.
Not exactly according to plan, but with the volatility in price movement and the lackluster performance of multi-nationals due to the $ strength, I got skittish and decided to close.
Teddi KnightKeymasterGreg 1) scenario,
Surely you were assigned the stock so you would not sell your LP but exercise it instead? Then the max loss is as defined, not > defined.
Also you have the option of selling a call to turn the Married Put into a collar trade, further reducing the BEP.Feb 4 2015 at 11:34 pm in reply to: Right time to roll Procter and Gamble Stock (PG Stock) / Buy stocks #16096Teddi KnightKeymasterVery nicely done. How did you decide it was the right time to STO the 82.5P and begin the roll?
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