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03-08-2014, 01:34 PM
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#1
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PA Steward
Join Date: Mar 2001
Location: Del Boca Vista
Posts: 88,603
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One of the easiest trades I have ever made
When I saw the futures were down big time last Sunday night in reaction to the Ukraine situation, I knew the time was ripe to sell some weekly put options on the S&P.
So Monday morning, I found that I was getting 50 cents on the 1,800 level S&P put options. They had a 90% chance of finishing out of the money. I thought that was a pretty good deal. So I sold some vertical put spreads.
The next morning, they were worth about a nickel, and Friday, as expected, they expired worthless. The easiest trade I have made in quite some time.
What were the chances that, with this strongly uptrending market, something like the Ukraine was going to move the S&P all the way down to 1800 in four days? Not very good. Plus you were getting a premium due to the nearly 20% spike in volatility that occurred Monday morning with the big drop.
I hope to remember this trade the next time we are in a strongly trending market and something more style than substance causes a big volatility spike.
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03-08-2014, 01:36 PM
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#2
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PA Steward
Join Date: Mar 2001
Location: Del Boca Vista
Posts: 88,603
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BTW, I realize this is a big time trading redboard...lol...so feel free to call me a redboarder.
I should have posted this live, but didn't. I do, however, think it's a great "teachable moment."
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03-09-2014, 07:23 PM
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#3
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Registered User
Join Date: Jan 2007
Posts: 1,133
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Quote:
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Originally Posted by PaceAdvantage
I should have posted this live, but didn't. I do, however, think it's a great "teachable moment."
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Agree 100%. (Not with the live post comment). I never thought anything wrong with red boarding in horse racing. In trading, I would encourage it. Nice trade Pace.
Last edited by Tape Reader; 03-09-2014 at 07:28 PM.
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03-09-2014, 09:18 PM
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#4
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Registered User
Join Date: Jan 2007
Posts: 1,133
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Here we go again. ES down about 4.75 at this time. Any thoughts? Anyone?
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03-09-2014, 09:57 PM
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#5
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Screw PC
Join Date: Jun 2003
Posts: 15,728
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Either BK or Tim on FM was surprised it lasted just one day.
Good for you, Mike.
__________________
Truth sounds like hate to those who hate truth.
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03-09-2014, 09:57 PM
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#6
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Registered User
Join Date: Sep 2007
Location: Boston+Ocala
Posts: 23,757
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buy at support or sell at resistance. this evening Gold is right at support $1331. i would by here and stop out @ $1329
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03-09-2014, 10:06 PM
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#7
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Registered User
Join Date: Apr 2008
Posts: 6,843
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Quote:
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Originally Posted by PaceAdvantage
BTW, I realize this is a big time trading redboard...lol...so feel free to call me a redboarder.
I should have posted this live, but didn't. I do, however, think it's a great "teachable moment."
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PA, does this mean that we don't have to "click" on the Balloon-Boobs anymore?.. 
__________________
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"Cursed be the man who puts his trust in man" - Jer 17:5 (KJV)
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03-10-2014, 09:04 AM
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#8
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Registered User
Join Date: May 2005
Posts: 2,394
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Quote:
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Originally Posted by Tape Reader
Agree 100%. (Not with the live post comment). I never thought anything wrong with red boarding in horse racing. In trading, I would encourage it. Nice trade Pace.
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In horse racing, the race is over by the time a red-board hits...in trading there is always the potential for continuation. My redboard for the week is PLUG, been on a tear recently, crossing over $9 now. I don't usually follow lower priced stocks, but it kept pounding my scanner.
__________________
Those with the best knowledge have the best luck !!!
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03-10-2014, 10:28 AM
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#9
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Registered User
Join Date: Jan 2007
Posts: 1,133
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Quote:
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Originally Posted by RaceBookJoe
In horse racing, the race is over by the time a red-board hits...in trading there is always the potential for continuation. My redboard for the week is PLUG, been on a tear recently, crossing over $9 now. I don't usually follow lower priced stocks, but it kept pounding my scanner.
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Wow! What a winner. Please, by all means, keep red-boarding.
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03-10-2014, 10:53 AM
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#10
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Veteran
Join Date: May 2004
Location: USA
Posts: 560
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@ PA
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03-10-2014, 11:06 AM
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#11
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Veteran
Join Date: May 2004
Location: USA
Posts: 560
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PA read all links at bottom previous link
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03-10-2014, 11:20 AM
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#12
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Registered User
Join Date: May 2005
Posts: 2,394
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Quote:
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Originally Posted by Tape Reader
Wow! What a winner. Please, by all means, keep red-boarding.
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I rarely do any swings/ints , but PLUG got me interested, same with JO..the coffee ETN. Grabbed a small one in BAC and looking for next entry on break/close over $17.50. QUNR,SOHU also on my radar. I still find daytrade's to be easier to do overall. Not very active today, grabbed PLUG for a quick move, NFLX short and /CL a couple of times. Think I am just going to sit back and let trades come to me now. Good luck.
__________________
Those with the best knowledge have the best luck !!!
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03-10-2014, 11:58 AM
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#13
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Registered User
Join Date: Jan 2007
Posts: 1,133
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Quote:
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Originally Posted by RaceBookJoe
I rarely do any swings/ints , but PLUG got me interested, same with JO..the coffee ETN. Grabbed a small one in BAC and looking for next entry on break/close over $17.50. QUNR,SOHU also on my radar. I still find daytrade's to be easier to do overall. Not very active today, grabbed PLUG for a quick move, NFLX short and /CL a couple of times. Think I am just going to sit back and let trades come to me now. Good luck.
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Thank you. Good stuff.
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03-10-2014, 12:04 PM
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#14
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Registered User
Join Date: Mar 2007
Location: Manhattan
Posts: 3,826
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Quote:
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Originally Posted by RaceBookJoe
I rarely do any swings/ints , but PLUG got me interested, same with JO..the coffee ETN. Grabbed a small one in BAC and looking for next entry on break/close over $17.50. QUNR,SOHU also on my radar. I still find daytrade's to be easier to do overall. Not very active today, grabbed PLUG for a quick move, NFLX short and /CL a couple of times. Think I am just going to sit back and let trades come to me now. Good luck.
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Pretty interesting long term chart. Apparently, it had a big run up during the dotcom bubble, then fell off a cliff.
A trend investor would've cleaned up on both the long and subsequent short side.
__________________
“Life does not ask what we want. It presents us with options”
― Thomas Sowell
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03-10-2014, 12:10 PM
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#15
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Screw PC
Join Date: Jun 2003
Posts: 15,728
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__________________
Truth sounds like hate to those who hate truth.
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