Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Calls and Puts for Income -- Ignore unavailable to you. Want to Upgrade?

To: Robohogs who wrote (4826)	2/20/2011 9:37:13 PM
From: Robohogs	Respond to of 5891

I just audited my account and it is nice to see cash withdrawal power back up to half the account value but I did not fully realize I was going to get sooo long with exercises. I daytraded what would have been a getting short MMR into getting long (pretty large size), had another mediocre daytrade flip on me near the close (puts exercised into me for pretty large size), and had the aforementioned MMI deliver me shares when I thought I would be getting short (very moderate size but the flip is pretty darned big). I did renew my 1-2% of account value SSO put spreads (which lost me 20% of premium paid in the upspike late Friday while the long lotteries all misfired). Oh well. The net impact of all of this has me much longer than I was with a bunch of short calls closed out and the new longs (which are about 125% of the value of the delta of the put spreads added adjusted for the leverage in SSO). And I still expect a washout soon. Jon

To: Robohogs who wrote (4826)	2/21/2011 8:07:33 AM
From: dealmakr	Read Replies (1) \| Respond to of 5891

Hi jon, I get portfolio margin capability from both Etrade & Ameritrade so it allows me quite a bit of leverage if desired. Position sizing is difficult (especially when you think that you are right LOL), but you have to trade the size that you feel comfortable with and weigh the what ifs all of the time to adjust your risk parameters. One position representing 1/3 of equity for me is just too large a risk and usually don't go for anything more than 10-maybe 15% of portfolio on any trade and only if it can be hedged or is extremely liquid like SPY,IWM etc, where this week I have an overly large short position, but only against cash not margin and can be rehedged easily. Going out on margin is something that I have stayed away from mostly over the past few years as its not worth the risk/reward ratio that I use. Have been through the ups and the downs over the years most of my trades are like singles or doubles like Pete Rose and not swinging for the fences like Barry Bonds, but thats just me. More higher percentage plays that use a lot of theta and are farther away from the action are where I usually like to dabble for recurring income when writing NP's and can put on a lot of positions using portfolio margining, but like anything else they have to be monitored every day for risk adjustment. I guess that the best thing that I can sum up in trading strategy is management of risk and trying not to get too greedy and have the market take away all of your profits when things go against you too much. There will be winners and losers in trading and when things are going well its harder to think about the things that can go wrong, but they are out there all of the time just waiting to crush you. Good trading dealmakr