[Reaver]

It's funny to me how I can look at market generated data and all the information available as far as profiles cti data from the LDB rotations, etc and it makes sense to me..but I start looking at options and my brain goes numb....

I think that's a sign.

[TinGull]

HAHA! Options aren't really that difficult to understand. I think a lot of people make it out to be more difficult than it really is. Sure, there are a lot of different strategies one can use to make money, but in the end its all based on the parent chart and if you can read one chart, IMO, you can read all others. If you're interested in trading options, then PM me...I've got lots of useful info you want it.

[Reaver]

You've got mail...

[brownsfan019]

Originally Posted by TinGull »

HAHA! Options aren't really that difficult to understand. I think a lot of people make it out to be more difficult than it really is. Sure, there are a lot of different strategies one can use to make money, but in the end its all based on the parent chart and if you can read one chart, IMO, you can read all others. If you're interested in trading options, then PM me...I've got lots of useful info you want it.

That's not 100% accurate Tin.

As I mentioned above, you can literally buy a call (want price to go up) and the underlying stock and future can go up but you can lose money on your option play! I'll never forget a trade I did a few years back on Boyd Gaming - nice chart, looked great for a long. The stock shot up nicely. My call option however lost significant value b/c of the implied volatility.

So, to say that you just need to read the parent chart is misleading. Not only do you have to read the parent chart, you then have to read your option strikes and compare the Greeks, IV, etc. It's not as easy as seeing a buy on the parent chart and buying any call you happen to see.

I just wanted to provide that other side of the coin b/c any newbies out there, and there appears to be an influx of them recently, should know this.

[darthtrader]

yea, the problem with options is they are more 3d than a stock or future. its not just price and volume, its price, volume and then how the greeks relate to the underlying.
from what i've seen with options alot of people just use them as leverage to the underlying when they would probly be better off even looking into single stock futures. i really wanted to get into options trading a year ago but the more I understood the less I wanted to trade them. I think they are best avoided.

[TinGull]

Originally Posted by brownsfan019 »

That's not 100% accurate Tin.

As I mentioned above, you can literally buy a call (want price to go up) and the underlying stock and future can go up but you can lose money on your option play! I'll never forget a trade I did a few years back on Boyd Gaming - nice chart, looked great for a long. The stock shot up nicely. My call option however lost significant value b/c of the implied volatility.

So, to say that you just need to read the parent chart is misleading. Not only do you have to read the parent chart, you then have to read your option strikes and compare the Greeks, IV, etc. It's not as easy as seeing a buy on the parent chart and buying any call you happen to see.

I just wanted to provide that other side of the coin b/c any newbies out there, and there appears to be an influx of them recently, should know this.

Right, I know that plays can NOT make money when you would *think* they should. I never bought straight up calls or puts...I always sold spreads. Understanding how the option is priced and knowing that the when you buy something because the underlying is going up, the volatility that is pumped into that option you just bought is what you paid for. The underlying can still go up and as time progresses the option call can not make money. All I'm saying, is that I don't think it's as difficult to grasp as some people make it out to be.

The most important thing to understand is the volatility and if you're going to BUY premium...you really need to understand that. You want to buy something not when it's going up, but when it's in an accumulation phase. That way the volatility isn't getting pumped in by news just yet, but people "behind the scenes" - so to speak - are quietly accumulating. This makes the premium cheap and then the volatility gets pumped up and the price of the actual underlying may not move at all, but you're in nice profit. I prefer to know when vol is really kicking, and watch the charts for strength or weakness, and sell a spread that's likely to supercharged with volatility so that the underlying won't *have* to do much for the vol to dry up and my premium to stay in my account.

[brownsfan019]

Tin - I was just referring to reav's question about buying a put and call at the same time. There's obviously a ton of option strategies out there, but straight up buying a call on a stock that goes up will not always result in a profitable trade. To me, that's enough to say no thanks.

[brownsfan019]

Originally Posted by darthtrader »

yea, the problem with options is they are more 3d than a stock or future. its not just price and volume, its price, volume and then how the greeks relate to the underlying.
from what i've seen with options alot of people just use them as leverage to the underlying when they would probly be better off even looking into single stock futures. i really wanted to get into options trading a year ago but the more I understood the less I wanted to trade them. I think they are best avoided.

I think the best vehicles to trade darth are futures or the stock straight up. After trading options and doing all the analysis that goes into just one trade, I found it to be very time consuming and my time was better spent looking for other setups to maximize my time.

And I've never been a fan of markets with market makers and/or shady brokers. Hence the reason I do not trade options anymore and have never traded forex (even though I get the forex bug every so often).