Thursday, September 14, 2006

Learning Options Trading

Some of you may be wondering why I did not update my blog as frequently as before. I have been spending the last few months trying to decipher how to trade options profitably. keke Reading through books, attending free previews from the likes of Clement Chiang, Optionetics and Mcwilliams. I realise all you need is observation! Observe and understand what happened in the market and presto! Below a sample from my options virtual trading! keke Yippie next time can teach options for thousands!!! hahaha Joking nia la, you know i always share when i find out how! keke Just wait for me to ascertain these strategies and i will post for free! keke

Notice the big big profits from GS and LEH? It is what they call earnings play or gapping play. GS was going to report it's results on 12th Sept, i checked the charts on the 11th and found technically not bearish and buy an slightly OTM call option. This sound like gambling? Well I thought so too. But this is also what many are paying thousands for!!! Same for LEH, but it didn't move up just as much as GS. The rest of the trades are strategies, some are spreads, some are longer time frame naked calls. MSFT and Dell, these are dying trades. I purposely left them on to rot to study how much i will lose if the options expire worthless. With a hedge, the maximum loss so far held out. It means the theory is working. Now how do I exit my GS and LEH trades? I will use T.A to time my exit.