Option Strategies, Option Strategies
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 Apr 7 2017, 08:49 PM
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#1
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Elite
5,608 posts Joined: May 2011 From: Here, There, Everywhere  
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Newbie to Options? Good learning spot:
https://www.tastytrade.com/tt/learn Malaysia? "Buy side Call options" only - AKA Warrants only, unlike the full Buy/Sell Call/Put options for US markets + AU market (from what i read only, never traded) |
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Apr 11 2017, 05:04 PM
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#2
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Elite
5,608 posts Joined: May 2011 From: Here, There, Everywhere
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QUOTE(win44 @ Apr 10 2017, 11:10 AM) Noob Question: Sell spreads aka verticalsSelling Puts & Calls (using my broker) requires a huge margin limit. Any way to sell options without having the margin to afford 100 shares of the underlying stock? Example, to sell 1 put option of FB, i need 100*$140 of capital. Any way around this?  Using your same example on FB: Sell Put $140 1 contract Buy Put $130 1 contract = Margin required $10 spread *100 OR Sell Put $140 1 contract Buy Put $135 1 contract = Margin required $5 spread *100 |
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Apr 12 2017, 11:41 AM
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#3
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Elite
5,608 posts Joined: May 2011 From: Here, There, Everywhere
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QUOTE(Puting Vladimir @ Apr 11 2017, 08:39 PM) option is the hardest financial instrument to master and it's not really worth it unless you're trading a huge volume nothing worthwhile is easy to master or even master-able.anyhow, funny... huge volume in Options may get U killed - leveraged instruments. "trade small, trade often" + portfolio approach. use the statistics + macro, for higher probability of profit |
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Apr 12 2017, 07:08 PM
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#4
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Elite
5,608 posts Joined: May 2011 From: Here, There, Everywhere
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QUOTE(duplicated @ Apr 12 2017, 06:11 PM) I would like to ask a question as I am relatively new to Options. I have an idea but I am not sure if this will work. hehe - think cost of time decay or ThetaLet's put it this way. current price of the underlying stock is ~$100 Buy Call at $100 Buy Put at $100 At the end of the timeframe or in the middle of it, the price must have moved considerably away from the $100 (in any direction), hence making us profits. My question is, is this feasible? When U BUY an option, U are buying the TIME + CONTRACTUAL RIGHT (extrinsic value) As the time of the contract passes, what do U think will happen to the cost or premium of the option, assuming the underlying doesn't move? ALSO - when U Buy an option AND don't have the $ to exercise the option (which is usually the case -100 units of FB, imagine) - how to make $? U turn around & sell your option right? By the time U sell your option, the contract DTE (Days to Expiry) is shorter than when U bought right? So.. the value of the option, again assuming all else being the same like no movement in underlying, U can sell for higher or lower premium than your BUY cost? If U can answer the above clearly, U will have answered your own Q whether feasible or not Sorry ar - i usually ask Qs for clarity or leading one to find one's own answer coz i ain't no sifu, still big L (learner) plate  This post has been edited by wongmunkeong: Apr 12 2017, 10:29 PM |
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Apr 13 2017, 11:16 AM
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#5
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Elite
5,608 posts Joined: May 2011 From: Here, There, Everywhere
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QUOTE(duplicated @ Apr 13 2017, 10:42 AM) Thanks. er.. i'm lost.Regarding the bolded part. Doesn't the intrinsic value only lost when we have not purchased it. Once it is purchased it's not relevant anymore. Am I right? In my case, I will buy at the beginning of the week/month and sell them when a profit in achieved (when the market has moves either way profitably). i stated extrinsic value, U state intrinsic i stated Theta or time decay effect on options' premium, U stated.. nothing perhaps totally different wavelength - can't help U gain clarity |
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