• Scotttrade
    Should I buy puts or short NFLX? I shorted NFLX and made some money. Want to buy puts but pretty new to option trading. Tips?
    11/22/11
    Reply (38)
    • Scotttrade: My thing is time value... how do you trade / buy puts so you won't have time value AGAINST you? time value decreases daily, right?
      11/22/11
    • Scotttrade: Is it best to exercise the options or to sell it before option exercise date? What is most profitable?
      11/22/11
    • Irishmedic: If you dont understand options totally, dont trade them, they will kill you, Paper trade them for a while. Understand decay and the time
      11/22/11
    • Irishmedic: frames of decay acceleration. Dont be a sucker and buy ITM unless its day trading, etc, etc, etc
      11/22/11
    • 1980XLS: Implied volatility around events like earnings etc, equally important. You can bet direction correctly and still lose.
      11/22/11
    • Irishmedic: Ad dont start on divended capture, got caught on that once!
      11/22/11
    • Irishmedic: Read some of Rocco Penola(I think that is his last name) on this site, he does a good job of explaining options.
      11/22/11
    • Irishmedic: He provides good educational links etc. Your playing with fire with options, so just be real carefull
      11/22/11
    • Scotttrade: how do you veterans play options? how do you limit decay acceleration?
      11/22/11
    • Irishmedic: At present I hold IWM deep at 80 for Jan, limits decay for another couple of weeks. Bought them a 10 days or so ago. Decay
      11/22/11
    • Irishmedic: minimal for 2ish weeks. I aso hold AZO Dec 320 puts from 8 trading days ago, mistimed by 2 days and I will be lucky to get out even!
      11/22/11
    • Scotttrade: I recently made a day trade short sale trade yesterday and made some decent money.Shorted at mkt open and closed right after noon. Don't kn
      11/22/11
    • Irishmedic: My IWM trade was for 1st week in december postion and AZO was meant to be for a couple of days
      11/22/11
    • Irishmedic: PS not a vetern by any means, so take what I say as you should take anything on a board!
      11/22/11
    • Scotttrade: Don't know if I should continue this regular short trading strategy but regular shorts. better to do regular short sales in my case since
      11/22/11
    • Irishmedic: Market is very volitile at moment so daytrading is lucrative if you get it right.
      11/22/11
    • Scotttrade: since I'm not used to option buy puts? regular shorts with tight stops.. is this a better bet for me?
      11/22/11
    • Irishmedic: Best advice I can give you is find your trading comfort zone, day, week, month, year, century lol. Their are people on here in each zone
      11/22/11
    • Ricardo Espinosa: I find selling call spreads a lot more profitable than shorting, and eliminates most of time decay, google option strategies, you can...
      11/22/11
    • Ricardo Espinosa: for example, sell 1 Jan 70 NFLX call and buy a Jan 80 NFLX call, you keep the credit if NFLX ends below $70 on 3rd friday of month....
      11/22/11
    • Irishmedic: At the moment I would say yes or use inverse etf if you are trading the mkt direction! again with tight stops,Options can have wide spreads
      11/22/11
    • Ricardo Espinosa: never let options expire worthless, buy it back (if you shorted it). I don´t like to buy outright calls or puts b/c time decay is a bitch.
      11/22/11
    • Irishmedic: Richard is correct in what he is saying, but again another level of complexity ontop of straight options. You need to know what your doing!
      11/22/11
    • 1980XLS: Do not execute complex option strategies while you are drunk either.
      11/22/11
    • Scotttrade: thank you all.This helps a lot.I guess for now,I'm going to do regular short trades with tight stops until I'm more comfortable with options
      11/22/11
    • Irishmedic: Richard, when I buy outright calls or puts, I by rule, buy 1/2 months further out than I intend to keep them, helps with decay! Unless I am
      11/22/11
    • Irishmedic: gambeling on a day or to two trade, lol
      11/22/11
    • Irishmedic: That is1 to 2 not a 1/2!
      11/22/11
    • Irishmedic: 1980, that is the only time they make sense, lol
      11/22/11
    • Scotttrade: I'm scared of time decay... any good reading tips/ books on this ? any recommendation on best to trading options?
      11/22/11
    • 1980XLS: Yes kinda like beer muscles. You always think you can win!
      11/22/11
    • Irishmedic: Search Rocco, he has tons of links, or use site email and ask, he is pretty decent and will respond with tips for reading!
      11/22/11
    • Scotttrade: Thank you all again!
      11/22/11
    • Ocean Man: Get a book from your local library. I recommend Get Rich With Options by Lee Lowell. Paper trade them for a while to see how they move and
      11/23/11
    • Ocean Man: decay and react to things. And for god's sake don't buy a whole bunch of Apple calls right before their first earnings miss in 36 quarters.
      11/23/11
    • mP1: @OM How are you playing AAPL ?
      11/23/11
    • Ocean Man: I lost big on it last month. Bought calls a week before earnings, stock went up from 380 to 420 pre-earnings, sold a few for a double, lost
      11/23/11
    • Ocean Man: big on the rest when they missed earnings.
      11/23/11