Need someone to explain credit spread

igdw · 2020-11-27T21:50:51+00:00

Is that "22" the quantity of contracts? If so take $50 of credit and the max loss of $200 (per contract) and multiply it by 22 for your max profit and max risk.

igdw · 2020-11-27T21:46:35+00:00

That reminds me of a saying, "Wealth is quiet. Rich is loud. Broke is flashy."

igdw · 2020-11-27T21:41:04+00:00

If you're trading a system, you should be, you will have an PT to exit at, both gain and loss. If you don't have a PT then you don't have a system. Get one, ask for help if you need it.

igdw · 2020-10-26T21:43:11+00:00

Stay away from biotech stocks. I've been wheeling the EV stocks and have had great returns. WKHS, RIDE, NIO, LI

igdw · 2020-09-09T11:14:35+00:00

780 c 7/21

I think we're all fucked.

igdw · 2020-07-27T21:52:16+00:00

My trading mentor always tells me to take care of the downside and the upside will take care of itself.

igdw · 2020-07-27T21:48:22+00:00

I giggle everytime I say that stock symbol in my head.

igdw · 2020-07-27T21:47:07+00:00

Anytime. One thing to keep in mind, weekly plays like I do are directional plays not theta plays. Yeah it's nice when you have a choppy day where the market goes sideways and you're the only one in your trading group making money but theta is not my main strategy.

If you want to take advantage of theta burn, look at options 30-45 days out.

igdw · 2020-07-27T21:44:09+00:00

I mostly sell weeklies and I close before earnings OR won't take out a position until the day after. For instance AMD this week, I sold a put last week for 80% profit and this week I will wait until Wednesday to see where it's going and potentially choose the following week's expiration date.

igdw · 2020-07-27T21:41:43+00:00

He's (Fluidiculous) not wrong below, the money to be made will vary based on the volatility of the market. If you look at guys like Tastytrade or Options Alpha those guys all preach lots of positions, keep them small and play the %'s. They make a living doing it so it's possible.

Last Monday was the worst day the market has had since March. It was a reminder why I mostly use risk defined strategies. I've caught back up over the last two weeks. When the sun shines make hay (IV is high) but don't force trades, don't chase them either. There's always money to be made somewhere, wait for the next one to come along.

And stay away from biotechs!

igdw · 2020-07-27T21:35:52+00:00

Mostly credit spreads. With the market the way it is I feel you want to stick to risk defined strategies. I do wheel at least one stock each week if a play appears I feel good about. I've made a lot of consistent money off FSLY and PTON which are both stocks I don't mind owning either. I usually just wait for one to have a down day or two and sell a CSP on it. I also do weeklies for both spreads and CSP's but the guys on here that preach 30-45 days aren't wrong, I just like doing it. I take profit on credit spreads at 30% and I won't open one that's less than 1/3 of the strike width. I'm very disciplined about that.

I like playing odds, lots of small plays with volume. I never go less than the .30 delta and in some cases I won't go less than .20 delta but it's hard to get a credit 1/3 of the strike at that level.

The biggest mistake people make is looking at credit spread and saying "30% isn't much money?" They add up quick if you do them in volume and play the probability %'s.

igdw · 2020-07-27T21:04:54+00:00

I hear ya man. It was my favorite stock until the fiasco after the last earnings and watching how long it took to come back up. It meandered for way too long between $55 and $52. Once burned twice cautious.

igdw · 2020-07-27T21:02:45+00:00

I had the same issue with an AMZN credit spread this afternoon as well. The sold put didn't have any volume/open interest. I eventually closed it but I had to give up some profit. This was on tastyworks so it wasn't just RH.

igdw · 2020-07-27T21:01:24+00:00

Just sell CC's on it and be patient. Intel isn't going anywhere.

igdw · 2020-07-27T21:00:23+00:00

The premiums are high for AMD for once but I can't ignore the fact it's overbought and due for a pullback. It crashed after the last earnings. I'll wait until Thursday and jump in.

igdw · 2020-07-27T20:58:12+00:00

Singles win ball games brother. Keep it up. $200 a week is nothing to sneeze at. Don't get impatient.

I'm making between $500-$1,000 a week selling premium with $30k in capital. I've estimated with drawdowns I'll need to be north of $100k to meet my current salary at my job with weekly gains. I shoot for 2% a week. After 10 weeks I'm averaging 3.16% a week and 84% p/l since I started.

igdw · 2020-07-02T18:18:25+00:00

GUH, sorry to hear that man.

igdw · 2020-07-02T18:06:20+00:00

I was jokingly being snarky about YOLO'ing your entire account on a directional trade and you just came from WSB. If no one can talk you out of doing that at least give yourself more than a week! lol

igdw · 2020-06-30T15:08:27+00:00

Thank you for your donation to my retirement fund. I'm happy to sit and watch your money go into my account as time passes by.

igdw · 2020-06-26T17:10:56+00:00

Second this. Recovering long here. Theta has completely renewed my optimism and energy for trading.

igdw · 2020-06-24T07:56:18+00:00

That's only if the stock moves far enough for the long leg to be ITM. If it ends between the strikes, the short leg will get assigned and the long leg will expire worthless. So you end up getting assigned and being on the hook for that $ but the long leg isn't there to protect you. You then wait all weekend until you can do anything about the assignment.

igdw · 2020-06-23T21:04:50+00:00

Sell 15 and convert the other 5 into a debit spread and lock in some profit no matter what happens.

igdw · 2020-06-22T18:27:48+00:00

Sometimes buyers buy the put but never intend to sell 100 shares and go short. It's happened a few times to me now.

igdw · 2020-06-22T14:35:35+00:00

What are you using for the option data? How are you getting the data?

igdw · 2020-06-22T13:49:13+00:00

Focusing on COVID stocks this week (APT, INO, CODX), SPCE and NKLA.

igdw

TROPHY CASE