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OptionTiger

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Posts posted by OptionTiger

  1. Posted

    The Iron Condor has two sides to it – the good and the ugly. It’s one of the most popular Options strategies out there, for good reasons. But when Iron Condors (or Credit spreads more generally) get into trouble, it’s not fun. You give up gains you made in 4 or 5 trades at one time.

  2. Posted · Edited by tradingwizzard

    Volume analysis is often an under-rated indicator. If Volume is normal, it really doesn’t say much. But when you see something out of the ordinary, like very high on a given day, you must conclude that Smart Money is active. And the trick is to judge whether that high Volume was buying or selling volume.

  3. Posted

    As of next week (July 15th specifically, Tesla Motors (TSLA) is finally getting the respect it may deserve. TSLA enters the Nasdaq-100 (NDX Index) on that day, replacing Oracle (ORCL), which moves to the NYSE.

     

    TSLA’s market cap is $12B, no chump change. However, critics have arguably not given it the respect many say it deserves. And the stock itself has suddenly burst into the scene, and in the last 3 to 4 months, has been one of the biggest movers in terms of Average True Range (about 8 to 10 points per day).

     

    To be clear, TSLA is far from profitability, and general consumer perception places their cars in the “exotic” category, something the company may have worked on intentionally.

     

    But the cars are stylish, have serious performance and most importantly, are 100% battery-run. You’ve gotta love that..

     

    As for the stock, this could be a boost since index funds are bound by their charter to add new entrants to their portfolio. Short-term BULLISH…

     

    Do you trade TSLA ? Let us know. If you don’t, you should look at the Options. It’s definitely one of the more exciting, tradable Options right now…

  5. Posted

    If you’re somewhat new to Options, you must have heard about the Option Greeks. In fact, a common rookie mistake with Options traders is that they ignore the importance of the Option Greeks (Truth be told, I’m guilty – I ignored them for almost 6 months). This is easily one of the biggest mistakes a newbie Options trader can do. Let me give you a simple analogy, and perhaps the importance of Option Greeks may hit home.

  6. Posted

    There was an article on Zerohedge yesterday on High Frequency Trading (HFT).

     

    Summary of key points

     

    - Yesterday’s ISM numbers were supposed to be released at 10 am ET

     

    - Some HFT firms apparently got the information 15 milliseconds earlier and executed large orders on the SPY (at 9:59:59.985 am)

     

    - Similar activity can be noticed on the ES futures 8 milliseconds prior to 10 am (9:59:59.992 am)

     

    Click here to read more, http://www.optiontiger.com/high-frequency-trading/

  8. Posted

    The gentleman is right "in a simplistic sense" they convey information. Unfortunately a simplistic understanding will generally put you in position to lose money....The following info may help;

     

    One way to understand Greeks, is in terms of risk.....most folks understand risk as the possibility of loss.....using "Greeks" you can separate risk into specific elements. The value in this is that once you (really) understand how the Greeks display the elements of risk, you can use that information....

     

    Since there is no reward without exposure to risk, people who understand what each of the greeks represent can choose (they can structure) their positions so that they manage (limit) certain risks, while using other elements of risk to make money (selling expensive premium for example).

     

    Your best bet if you are serious about this subject is to get a book....Larry (Lawrence) McMillan's book "Options as a Strategic Investment" is the best one for amateurs....take your time and really internalize the information....it will provide you with a good starting point and from there you can move on in whatever direction you choose

     

    Most beginners start out thinking that you either buy or sell premium....then they move on to creating directional or non-directional strategies....and from there they usually go in various directions depending on how sophisticated their understanding has become....unfortunately there isn't a shortcut to experience....take your time, keep your powder dry and be a good observer...

     

    Best of luck to you

    Steve

     

    Larry, Steve is right. There is no substitute for practical application and seeing the Greeks in action. The problem with a book is that most of the time, you don't get the practical side of things. I've mentioned this to you before, your best bet is to take up on my earlier post where I gave free access to my cutting-edge course. Take the course on Greeks, and you'll be clear in these concepts. Here it is - https://www.udemy.com/learn-options-trading/?couponCode=TLGreeks. Actually, anyone on this post is welcome to take it. There seems to be a lot of discussions and a lot of confusion on this thread..

    Best

    Hari

  9. Posted

    Larry, with a good trading platform, you can simulate the 3 main parameters for Options - 1) Price movement 2) Changes in Implied Volatility and 3) Passage of time.

     

    You can simulate all 3 at the same time as well. On the TOS platform, it'll show you what the Greeks will be for your simulation. In a simplistic sense, this is all you need..

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