19709

50 Four-Day September Expiration Option Ideas

The article was published on 9/15 as indicated at the top and confirmed by the author's statement that there were 4 days left to options expiration which was on 9/18.


On Sep 15 09:42 PM S2009 wrote:

> The table is incomplete, no price at the time of publication or no
> bid/ask for options. So if you do not see this table exactly at the
> moment of publication (which is not shown, is it Sep 2009 or Jan
> 2007 - nobody knows) it is basically useless.

Banking on Banks: Detailed Option Strangle Strategy

Tsk tsk tsk. If you don't like the market, you don't have to participate.


On Aug 26 08:15 AM apppro wrote:

> These types of trades & trading are actually what is 'STRANGLING'
> our markets and society as a whole. All this options trading has
> turned into a ponzi gambling scheme that will crash our system and
> adds NOTHING now. They say it adds liquidity - BS! If anything all
> that money being thrown about on ultra short term trades is NOT being
> invested on long-term basis.. it actually takes money OUT of the
> pool and contributes NOTHING to our economy - ever.
>
> We need to figure out a way to stop all this insanity and not come
> up with new methods on how to make it worse. I am still convinced
> that the best way is to TAX these trades as if they were gambling
> wins somewhere around 50%. That'll stop it, and even if it doesn't
> it will help pay for the mess all these trader's/traitor's insanity
> cause.

Two Citigroup Income Generating Option Strategies

Let's see. I bought the stock on 8/11 for $3.72. Today (8/13) I sold August $4 calls @ $0.21 and expect to be called at expiration. Before commissions, that would be a return of 13%+ in 11 days. After commissions, the 11 day return would be 12%+. If C closes below $4 at expiration, I will have lowered my per share cost to $3.53 after commissions and will write calls again.


On Aug 12 07:44 PM Ricard wrote:

> One clarification, when he writes his covered calls, instead of being
> 'forced to cover' he is instead forced to eat the losses garnered
> through holding C. Like I already mentioned, for a stock this volatile,
> losses over 11 days can easily get into the high teens, if not 30-40%,
> without any news, or any rhyme or reason causing the swings in price.
> So, he keeps his 6% premium and loses the farm. This will probably
> happen 50% of the time if he chooses to 'annualize'.
>
> The odds are not in favor of making the trade Marco suggests, unless
> you have a crystal ball that can predict daily/weekly movements of
> any stock. I'm sorry, but mine broke last week, so I'm using LEAPs
> instead, and buying calls, not writing them.

Two Citigroup Income Generating Option Strategies

For further justification of Marco's suggestions, I refer you to. . .
seekingalpha.com/artic...
. . . your own article in which you state the reasons for the "not faint of heart" to trade options on C.




On Aug 12 11:02 AM Ricard wrote:

> That high volatility kills his strategies as well. High volatility
> equates to fat premiums, but you STILL must be correct in direction
> if you use either of Marco's strategies. For a 5% gain, his strategies
> are far too risky for the infinitesimal returns he is suggesting
> you accept.

Two Citigroup Income Generating Option Strategies

Let's see - 6% gain in 11 days equates to an annualized gain of 199%. Doesn't sound infinitesimal to me. And don't forget, good old Uncle Sam isn't going to let this company fail and throw away $45 Billion in the process.


On Aug 12 11:02 AM Ricard wrote:

> That high volatility kills his strategies as well. High volatility
> equates to fat premiums, but you STILL must be correct in direction
> if you use either of Marco's strategies. For a 5% gain, his strategies
> are far too risky for the infinitesimal returns he is suggesting
> you accept.

Two Citigroup Income Generating Option Strategies

The uncertainty engulfing Citi's management and the extent of its credit problems adds to the stock's volatility. The extreme volatility is the basis for Marco's suggested option trades.


On Aug 11 08:53 AM john s. gordon wrote:

> if citi has been left in the dust compared to the others, there is
> probably a reason.....

Two Citigroup Income Generating Option Strategies

You are ignoring the downside protection afforded by the option premium. Unless the stock price at option expiration falls below the premium adjusted stock cost, selling the option has in fact generated income.


On Aug 11 08:53 AM jamo59 wrote:

> calvin has it spot on correctly~~
> thanks for expanding on it thoroughly......
>
> On Aug 11 08:49 AM jamo59 wrote:

Two Citigroup Income Generating Option Strategies

Marco's point in using C is its high volatility. Coupled with the fact that the U.S. Government is more than a > 30% owner of C and consequently cannot afford to let it fail, generating a 6%+ "dividend" in 11 days is extremely enticing. Also remember than Marco is trying to educate individuals who may never have traded options.


On Aug 11 08:49 AM jamo59 wrote:

> agree with acttang...rather amateurish........if you want those buy/write
> returns, do it with dozens of much more enticing stks.....

Why Leveraged ETFs Are Bound to Deteriorate

You obviously did not read the article closely enough. The author was saying that if the index fell to 900 and the 3X fell to 700 an 11.11% increase in the index back to 1000 would not be sufficient to return to 3X to 1000. It would take an increase of 14.283% in the index equivalent to an increase in the 3X of 42.85% to return the 3X to 1000. While your math is OK, your reading comprehension is not.


On Jul 15 08:58 PM mwfall wrote:

> THE AUTHOR IS 100% WRONG. HIS ARTICLE IS WORTHLESS AND HE'S A MATH
> DUNCE.
>
> HERE'S HIS MISTAKE:
>
> take the triple levereged one.
> when it goes from 100 to 70 the percentage loss is calculated by
> dividing 30 into 100 equals 30% (he was right on that one)
> when it goes from 70 to 100 the percentage gain is calculated by
> dividing 30 into 70 equals 42.85% gain !!

Why the Dow Is Headed to 6000

Well stated for as you obviously understand, the consumer as an investor is almost always wrong. Better to adopt the contrarian approach as you advocate.


On Jul 01 05:06 PM WarrenTeeSmith wrote:

> Very interesting article. I am very much encouraged by all of the
> followers, who are at least as negative towards the market as the
> writer of the article. I have no idea where the market will be six
> months or a year from now. I could almost care less, if the market
> as a whole declines another 1,000 or 2,000 points. I am fairly certain,
> that the next 6,000 point move on the Dow, or the next six hundred
> point move on the S & P, will be up and not down. In the mean
> time, I will continue to buy good companies with good management,
> and hold them for the longer term. I will enjoy didvidend yields,
> far in excess of what a 5 year treasury is yielding. Maybe in 5 or
> 10 years I will look back and say you folks were right, I could have
> waited for the market to drop another 1,000-2,000 points or so. And
> if it does, I will step in and scoop up a whole bunch more. I personally,
> have never been great at predicting market direction over the short
> term. Finding great companies, with good balance sheets, and good
> management, at an attractive price....those are things I have been
> able to do well, and has paid me on average, about 13% a year, compounded
> over the last forty years. So, I'm not going to fret about a few
> thousand points at this stage of the game. It's when the writer of
> this article, and his followers, starts turning bullish, and starts
> calling for 20,000 on the Dow, that I might take pause, and allow
> some of you nice folks to buy some shares from me.
>
>

Don't Let the Banks Break You: Hedge Yourself with These 15 Option Strategies

Whether you have very little downside protection depends, or course, on whether you're writing I-T-M or out-of-the-money calls. If you're called out of stocks you like, you can always buy them back and write additional calls.


On Jun 24 12:51 PM kjangelo wrote:

> selling covered calls is a good income strategy when the stocks stay
> the same or go down slightly , however it weeds out all your winning
> stocks and potentially leaves you with the losers. Also it leaves
> you with very little downside protection.

Don't Let the Banks Break You: Hedge Yourself with These 15 Option Strategies

Actually, Marco suggests I-T-M options on a regular basis where the probability of being called is certainly higher and his projected profitability numbers are consequently more likely.


On Jun 24 10:31 AM LanceLink wrote:

> Bernie --
>
> Here are the problems with this, and other articles that Marco writes:
>
>
> First, he bases his "return" on the possibility that the stock will
> be assigned. This is just based upon the hope that the stock will
> rise to the higher strike price. Basing your returns "if assigned"
> is a shaky strategy.
>
> Second, he keeps listing a column of numbers that he says is the
> "current probability" that the stock will reach that strike price.
> He does not explain the basis for that calculation in this article,
> nor has he ever explained it (I've checked his blog, it's not there
> either). Yes, Marco, I understand that there may be some extrapolation
> you can make from the option price and the volatility, etc. about
> the chances that a stock may reach a certain price, but it's all
> just hope.
>
> Writing calls is a solid strategy for income, but articles like this
> are not particularly useful.
>
> Write ATM for maximum return and protection.

Don't Let the Banks Break You: Hedge Yourself with These 15 Option Strategies

Selling covered calls is a viable way to gain downside protection on stocks you already own while enhancing your dividend yield.


On Jun 24 06:54 AM apppro wrote:

> Don't let these guys fool you either. Options may work, but not for
> 98% of us. Actually we're all suffering this added volitility just
> so a few option traders can make a couple of extra $.
> Stop the insanity! Even as Warren Buffett said the other day:
> "Make it simple!"

Obama Wants a 'Better Plan'? Here's One: Bite the Bullet

You won't need any bullets - the bad guys would all have met their demise. By the way, what's a "bureden"?


On Apr 06 10:15 AM Pat Collins wrote:

> One really good thing about being a Blogger or Critic of Obama and
> government is that you don't have to be right. Obama does!!
>
> In one year, no one will remember what kind of cockeyed statements
> you made, but Obama has to bear the bureden of his decisions for
> all of history.
>
> We have plenty of critics but not many people linging up with workable
> answers. Biting the Bullet is what happened with Lehman Bros. If
> Citi, B of A, JP Morgan, Goldman Sachs, ING, AIG, et al go bust,
> we won't be able to buy a bullet!!!
>

Will McCain's Vice Presidential Selection Help the Markets?

RightinSanFrancisco

Glad to see someone seriously considered the post.