tjlocke99

With SPY around 143.47 here is the 143 straddle leg prices for the Sept monthly: bid/ask call: 1.71/1.73 put: 1.67/1.68 Odd with the call .47 ITM that they would be similarly priced.

Hello again. If I am looking for good post-earnings analysis right after the company makes its earning announcement then what site(s) do you think are the best. Perhaps flyonthewall, http://www.theflyonthewall.com/splashPage.php?action=main&arg=A Is it enough that if a company misses its earnings forecast then the stock will go down? Look at FNSR today. The stock went up despite missing earnings forecasts.

Kim, My concern would be the Sept options expire after the 12th, so as you as you say the IV could rise faster on the Sept short than the Oct long.

As I write this I am pretty sure I already know the answer, but I was wondering if anyone has tried to this based on indicators like volume, OI, IV increase on just the Put or Call side, etc., and if they had any success? I know the IV crash would be a major issue with being directional anyway, but regardless knowing if anyone had any success in this area could be helpful. Thanks.

Interesting. If this is accurate then don't hold AAPL long positions after the events. Perhaps entering the month, week, or even day prior to an event could be a good bullish play, but I have no idea how IV did during these times.

marco, We discussed this idea in this thread. http://steadyoptions.com/forum/topic/452-aapl-september-2012-announcement-play/page__hl__aapl#entry8344 Tough call. The stock has shot up over $100 since its low. I have no idea on the volatility play side of it.

I remain reluctant to trade ICs on American style options both because I am too new to the options world, but also because I fear a crash, flash crash, or massive increase in the market or underlying where I get assigned and the underlying changes so quickly that I get wiped out. I assume the algorithmic traders would have trades auto-executing, and I'd have no chance.

Great tip. Thanks Marco! I think I see you are using it in the VXX calculations!

I was wondering if anyone looked at trading straddles around economic indicators like the employment reports, retail sales, manufacturing index, construction spending, etc. Theoretically there would be stocks that are correlated with these indicators. We have mentioned one recently, the fed meeting and GLD. I do know it would be possibly to write software to check for correlation, but that is a reasonably complex project needing multiple sources of data. Does anyone no of a site or report that lists stocks correlated with events or reports OR has anyone tried this strategy before and have an opinion on it? Thank you! Richard

Hello. No actually I had wanted to unload some stock after hours that had gone up alot in after hours trading. I had wanted to lock-in the profits. I was just uncomfortable executed an after hours trade without any experience or knowledge in this area. Thank you!

A few days ago I considered closing a long position I had in a stock when in after hours the price shot up. This was around 5:30 PM ET. I did not do it because I did not have experience in after hours trading. I had no idea both how to do it in the IB software, as well as what type of fees there may be. Does anyone have any experience and lessons they could share on after hours trading? Thank you very much! Richard

I keep thinking I am missing something but I think TOS thinkback may have some major defects. Take a look at ABT (Abbott Labs) "Last" price on 7/10/2012: 65.67 Then TOS thinkback says for 7/11/12 "Last" 65.18, Net Chng, +.02 This VERY wrong. 65.67 to 65.18 represents a decrease in price NOT a +.02. Am I missing something? Thanks!

well said Chris. i have been heading your advice and staying clear of these

good points csensen13. however it is odd that a huge site like morningstar would deviate from the traditional representation of delta. I was particularly looking to find a web site that would show me near real time option chains with the normal delta representation. I wanted to be able to find liquid ITM put options with an ~ .80 delta. These numbers morningstar is using for the greeks just seems non-standard and confusing. oh well.

I would have thought that too Kim however they are showing the delta of the ATM 26 Strike Aug Call at 18.3%. That doesn't make sense and neither do the rest of the deltas. Thank you.

Good afternoon. I see morningstar has option chains and some interesting data from a web interface. Does anyone know what they mean when they are showing delta as a %? Thank you! http://quote.morningstar.com/Option/Options.aspx?ticker=FSLR

Please note that the Android version of MobileTWS does NOT support trading spreads. Good luck. I have a full time job that doesn't afford me access to my broker often, and I can tell you it requires finding your own niche to these strategies. In the end that may work for you too rather than trying to trade on an iPad alot! Again good luck!

If you read Jeff Augen's books, like his Excel book, he says that strategies that exploit anomalies exist temporarily until many people figure them out and then that causes the anomaly to go away. He seems to advocate a style of learning how to analyze and then figure out on your own what will be profitable for some period of time. Now the point would be that this butterfly strategy is now published, and I would wonder if it WAS but is no longer a viable strategy. Additionally my point earlier was that if your ITM position is only 5 points out that it still has alot of extrinsic value. That extrinsic value will also decay along with your ATM shorts and OTM long. Therefore it may be better to structure that ITM long deeper ITM, like 10 points.

I don't get that analysis though. The long butterfly opened on Thurs at 1000 and closed before the Friday close IS selling the weekly and making money off decay. Exactly what he is saying is foolish.

I think conceptually the ITM long should be deeper ITM because the idea is that this position won't decay much because there isn't much extrinsic value to decay away. Perhaps structuring these butterflies a little differently is better. For example on AMZN you could have done this yesterday: +1 635/ -2 645 / +1 650 Or some variation on this like +1 630 / -2 640 / +1 650 or +1 630/ -2 640 / +1 645 The key here is on the ITM call, if the extrinsic value is low that when the trade is flat you won't lose much. I can't test intraday, so I don't know how this would do, but I would submit this as a possibly variation. Also part of the analysis is how expensive the OTM call you are buying is. Sometimes the 645 could be a better deal then the 650 if it cuts your risk down and only costs a few cents more. Sorry I can't be more help! R

My problem is the times I have tried to use IB for paper trading, I found that I could not get a trade to executed unless I was buying at the ask or shorting at the bid. Therefore I found it pretty much useless. Perhaps some of the other platforms like TOS are better. Why can't this trade be -.05 or even a larger negative number? The negative value of the short strikes in the middle can be greater then the combined value of longs in the wings can't they? Its not likely but isn't it possible? Also, I think Marco has had some great points about adding in the bid/ask slippage and broker transaction costs and showing how profit is significantly effected.

be careful. did you accidentally enter the 24 Aug expiration? You need the 31 Aug. Richard

Thanks Kim. I still don't see why the price of AAPL vs SIRI matters for option liquidity? Are you saying because there will be more "active" strikes on higher priced stocks?

Thank you Chad. Why does the price the options traded at factor into liquidity? Could you post the list purely on volume or OI? Marco, the other thing I didn't consider is how liquid OTM or ITM options are. I wonder if that is different for each stock.

Chris developed his own list and posted some of the stocks in this thread. I have asked him if he could post the rest. I think he did some manually analysis on volume & OI.