Thursday, November 16th, 2017

Day trading SPY options: How can I do this better? (Long question)?

(Note: I have experience in real money with options dating back to 2000, first calls included in my IRA and then calls a long time in my cash account if you have no experience day trading with real money. I have the 25 K parking in an account to meet the standard pattern day trader and a 10 km to make the actual contract purchases.) I have a job that allows me to keep an eye on the stock market in real time. In January I started to play with virtual commerce engine OptionXpress, daytrading SPY options. My strategy is rather modest, I can buy 5-10 ITM contracts either for sale or depending on the direction of the market, and sell when I see the reverse. I chose 10 because I believe that contracts with a small size so that, if I submit an order to sell the offer, you must complete immediately unless the market is moving very fast so I can lock in a profit if the trend is reversed. I can open a position at a time, I never go to my desk with an open position and I am 100% effective at market close each day. SPY because I can use as a basket of 500 stocks that are stored in a sudden drastic moves in the price give me time to exit a position with a minimal loss if the price goes the wrong way on me. My immediate goal is $ 100 after commissions per round trip, a goal that requires only a $ 0. 15 move in the option price. Not always in the direction is right, 4 out of 5 is typical, and I am off between $ 400 and $ 500 for 6-7 day trips trip. My initial involvement of $ 5,000 play money has grown to about $ 15,000 since 1 / 19, when I started doing this seriously. No get rich doing this, but in the course of a year’s worth an extra person for my family income. If I do nothing else to pay my house and future college fund for my three children that it’s pena.Ahora I proved to myself that this seems a reasonable strategy I’m trying to understand what I can do best and now I’m in the area of “I do not know what I do not know.” Level 2 offers I know but if it is something that can help me I have no clear how to use them. I know there are all kinds of indicators used by technical traders, but do not know if these scales to the level of daily transactions. I know of the existence of the Greeks, and while I understand roughly what the average numbers and equations, I do not know if these will help position lasting 15 minutes or menos.Mi main interest in the publication of this question is whether there are tools you can use to help me make better decisions as to enter or exit a position or tell me more about what the market is doing. This strategy seems to be working well and if I can translate this into real money, I consider myself a success. I do not want to be greedy, but I certainly would like to know if I can do what I’m doing and more time 888options eficacia.Pasé and optionetics. com but it seems that much of the content on the Internet refers to strategies such as spreads, butterflies and condors, things that simply do not apply to what I’m doing. I know there are options for day traders, including some specializing in SPY, read these questions, and I would be grateful if I even had a list of books or even just a few things to go and learn about research that has shown experiencia.Gracias useful for reading in here and offer any help for all ustedes.Sin certainly understand the problem with fillers, in fact, asked me a question on here the other day. I had noticed that I could put in a sale at a price like 3. 10 and a minute later to see a bid / ask 3. 15 / 3. 20 with my sell order is still open. My only thought was “What the ****?!” They told me the other replied that, actually, in a small order an inquiry under the open offer was never on something as fluid as espía.En as to fill half the SPY I could live with that. The options on the SPY intraday movement enough that even if each order filled at the question and you sell to continue to offer me money because I’m looking for movement. 15 on the options that can be moved. 30 or more in a short time. I’ve gotten good enough to choose the direction of the trend that I’m going to buy options that are 3 or 4 points ITM. This makes me me. 15 or more moves with only a small step in the price of the spy.

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2 Responses to “Day trading SPY options: How can I do this better? (Long question)?”
  1. x says:

    i have lots of information regarding options trading.

    contact me on my email id by accessing my profile.

  2. Eric714 says:

    Sounds like you have a developed pretty good strategy.

    I hate to rain on your parade, but the first thing that people notice when they move from virtual/paper trading to real money trading is… the fills.

    Most paper accounts automatically fill at the mid price (between the bid and the ask.) That is not necessarily where the market is.

    The SPY trades relatively close to the mid, except at times of extreme volatility – which is when you want to get filled. I normally put an order in at the mid. Sometimes it gets filled immediately, but it might take 5 or 10 minutes. I might have to move my price by $0.05 if I can’t find the market.

    I remember freaking out in Oct 2008, I could not get fills anywhere near the mid (in my real money account.) The market was moving violently and I couldn’t get in or out of trades.

    I wanted to puke.

    Personally, I love the SPY and trade it a lot. It’s the most liquid equity on the market.

    Day trading options can be a decent strategy if you can stay on top of it.

    I would not discount the use of spreads – they are another very powerful way to provide leverage and protection.

    Here’s the deal with spreads: A stock can move up, down, or sideways. Spreads allow you to make money in any one or two directions: up; down; sideways; up or down; up or sideways; OR down or sideways, Plus, they help you limit your maximum risk.

    I would also suggest that you learn the Greeks. Some traders understand them implicitly – maybe you do, too. You need to understand the concepts behind them.

    Stock pricing is effected by one thing: the stock price (duh!).

    Option pricing is effected by stock price, volatility, strike, interest rates, and dividends. That is 5X level of complexity. If you are in-and-out in a relatively short timeframe, it can minimize the impact of the Greeks, but you are still vulnerable to them. You need to learn them.

    I would suggest that you open an account with thinkorswim. They have the most powerful platform on the market. There has been a veritable exodus of people leaving OX for thinkorswim or tradeMonster (another good platform).

    Professionals spend thousands per month to use platforms similar to thinkorswim… but TOS is free. Plus, they have tons of free education and support. The thinkorswim platform has a steep learning curve, but the effort pays off. You will be amazed at the complexity and features. Listen in to the free Trader Lounge Wednesday chats at 4:15 pm ET. Today is John Person (as in Person Pivots.)

    The charting is the most amazing free platform available. They offer over 200 technical studies and even have their own code which allows you to tweak or create your own custom studies. They also have some unique “scans” like the Sizzle Index that looks for abnormal options volume.

    With regards to education: I am a firm believer in continuously improving yourself. You are going to learn a lot on your own and through books and free seminars. But, you are also going to make a lot of mistakes.

    If you want to do it right, it takes time and effort. I was trading options on my own for years. I made… and lost a lot of money making stupid mistakes.

    I have been through a stock and options education program called Spread Trade Systems. It costs about 10k. It’s a fantastic program and is not a “get rich quick” scheme. It’s like going back to college – there’s like 42 live classes (web), live chats, home study materials, and precorded session. It takes about 5 hours per week and will take you close to a year to get trough it. They also offer a money back guarantee if you are not profitable. I researched lots of companies and found them to have the best reputation and their students were fanatical (now I am one!) If you want to contact them, feel free to use my name (Eric Hale). You can contact me if you want to ask questions.

    * When I tell people that I trade options, they usually say “That’s risky!” I normally say that “So is using a tablesaw. But, if you know what you are doing and you take the proper safety precautions, it’s the right tool.” (I have a good friend who cut his finger off using a table saw.) The key is to know what you are doing. If you just run to the HomeDepot buy a table saw, take it home, and plug it in, you might lose a finger, too. *

    I am not trying to imply that you don’t know what you are doing. But you are here asking questions. So, you obviously want to learn more.

    Sorry to ramble so much, but I hope that was helpful.

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