April 2014 Trades

My April 2014 E-mini S&P trades:

Sold:
Jul 2014 1400 put
Jul 2014 1525 put
Jul 2014 1650 put
Jun 2014 1510 call

Bought:
Jul 2014 1700 put

Disclaimer:
This is purely for educational purposes and not trade recommendations.

March 2014 Trades

My March 2014 E-mini S&P trades:

Sold:
Jun 2014 1700 put
Jul 2014 1600 put
Jul 2014 1450 put
Jul 2014 2030 call
Jun 2014 1930 call
Jul 2014 1970 call

Bought:
Jun 2014 1910 call
Jun 2014 1740 put

My March 2014 commodity trades:

Sold Sugar Jun 2014 16 put (closed with profit on 4 April 2014)

Sold Corn Jul 2014 410 put (closed with profit on 28 April 2014)

Disclaimer:
This is purely for educational purposes and not trade recommendations.

The beauty of selling put options

Selling put options proves to be a profitable way of trading compared to what I did previously!

The flexibility of this technique coupled with the risk management of it make it a very attractive strategy for someone who has never made any real money in the stock market like myself. 

There are many ETFs available.  Go for those which are high in liquidity and thus low spread between bid and ask prices.  For example,  the SPY, QQQQ, IWM, etc.

In selling put options,  remember,  you just want the underlying ETF to stay above the put strike price which you sold the put option, to make money. Sounds easy?  :) perhaps.

If you know technical analysis,  great!  Sell put options below the support line to give you that added edge.  Else not to worry too much, try aiming for around 10% below the current price.  You may have to sell 2 or 3 months out.

Wild dreams

Selling options the ETF way

I mentioned I took up two courses on options selling. They were both conducted by our local traders who have been very successful in this niche area.

The first course I took was on stock options.  It uses a very unheard of technique called short guts, which generally means selling in the money options. I was the only participant of the course and one day lasted a full day.  Basically,  the idea behind this form of selling is to create a window to trap the underlying stock which you intend to sell options on it. Call options on the low side, implying in the money call options and put options on the high side, meaning in the money put options.  The equivalence of it is actually the short strangle strategy.

Though the course was taught on stock options, I expanded the idea to ETF instead,  to give myself the added safety net. Stock options though more juicer,  the risk is definitely there.  You never know when the stock will go burst! 

Selling options on ETFs prove to be a success for me afterall. I love the technique very much.

Wild dreams

Pursuing hard on it!...

From that point onwards, I started to spend lot's of time reading up on this topic on selling options,  I mean really hell lot's of time!

I was so serious about it that I took up two courses on selling options,  costing me a total of $4k! But I think it's really worth it as one of the courses was on selling stock options while the other was on selling future options.  I finally get to see the complete picture of selling options on these two markets,  which blew my mind away!

Selling options, finally!

I stumbled onto this book "Complete Guide to Options Selling" on one occasion.  Can't remember when and how, but that completely changed the way I look at options trading forever! 

I was fascinated with how people could actually put on trades on this side of the market and it seems very logical for someone who always get on the wrong side of the trades.

It is a book on selling options in the futures market but the strategies explained in it blew my mind away. I knew somehow,  this has to be it!

And this started my thorough search into this niche and seldom heard of field of selling options, instead of buying them.

Wild dreams

The black box trading system

Learning about covered call options soon led me on to the more sophisticated kind of trading--- the use of some black box trading system which is supposedly good at screening stocks options opportunities for you!

This sounded too good to be true to me then!  Simple steps,  no research work needed, and just need to click s few buttons and that's it! Can you believe it? ?!! Well, I did!!

I attended one course which sold a particular kind of options trades picking capacity. .. cost me around $2k then! Forgot to mention,  there is still a need for some online subscription to data feed every month.  Amazed by what this software could do, I trusted the first signal generated by it and did an actual trade.  Complete disastrous! ! The stock gapped down the following day and never recovered even after the options I bought expired!

I sold it off straight away and gave up hope on such thing from that point onwards.

That broke my dream of making money using options for a while.   I took a  break off trading and went back to the drawing board once again as I was completely lost of how to proceed next.
However,  I still firmly believe that it is possible to make money using options and I held on to that belief while in pursuit of the next holy grail. ...

Wild dreams