Escape's Options Trading Diary - Phase 2
Here is log as of last session.
Log:
NIFTY 25Oct12 CE 5700.00 (B) 500 @ 71.25 (S) 500 @ 67.45 (P/L) -380.00
NIFTY 25Oct12 PE 5700.00 (B) 1100 @ 59.85 (S) 1100 @ 62.89 (P/L) +4864.00
Result:
After deducting all charges: Rs. +4288.66
Capital Status (Since September):
Exact Initial Capital: Rs. 45,000/-
Current Ledger balance Rs. 30095.29 (-14904.71 )
Learning/Remark:
After yesterday's big loss, today I'm able to recover some. Today first after first trade, where I lost around 8 points, later on, most of trades were successful.
For SL, specially trades which I took at breakout, kept SL little close, just 2-3 points below breakout level. Earlier I use to keep at support level of last swing. This change help me to prevent higher losses due to SL hit.
Log:
NIFTY 25Oct12 CE 5700.00 (B) 500 @ 71.25 (S) 500 @ 67.45 (P/L) -380.00
NIFTY 25Oct12 PE 5700.00 (B) 1100 @ 59.85 (S) 1100 @ 62.89 (P/L) +4864.00
Result:
After deducting all charges: Rs. +4288.66
Capital Status (Since September):
Exact Initial Capital: Rs. 45,000/-
Current Ledger balance Rs. 30095.29 (-14904.71 )
Learning/Remark:
After yesterday's big loss, today I'm able to recover some. Today first after first trade, where I lost around 8 points, later on, most of trades were successful.
For SL, specially trades which I took at breakout, kept SL little close, just 2-3 points below breakout level. Earlier I use to keep at support level of last swing. This change help me to prevent higher losses due to SL hit.
Dear Escape
You should start now with phase 3 as you never will get out of your losses with the kind of directional trading you do. As you are still in a learning stage, do it now for your own good. Phase 3 has to be:
Adjusting and handling losses.
You can do that by using this month series and next month series, even the volume on next months series is not so good.
You go long itm next month series and you do short atm when in loss with this month series. Calculate the loss you made with the itm option and add it to the atm option you sell. This kind of trading will improve your chance to recover losses you made in the past.
As next month itm series will loose less time decay when you are wrong, you sell this month atm series which will loose faster time decay compare to your next month series.
Such trades are called: Calendar Spreads. Even than: Also learn to adjust such Calendar Spreads in case market goes crazy and moves against any of your break even points. With out knowing how to adjust the calendar spread, you do your self not a good thing.
I know that you told in the first post of this thread that you do not hedge, but in the long run hedging this is the only way to survive and recover loses. You can strongly believe me in that.
All the best
DanPickUp
You should start now with phase 3 as you never will get out of your losses with the kind of directional trading you do. As you are still in a learning stage, do it now for your own good. Phase 3 has to be:
Adjusting and handling losses.
You can do that by using this month series and next month series, even the volume on next months series is not so good.
You go long itm next month series and you do short atm when in loss with this month series. Calculate the loss you made with the itm option and add it to the atm option you sell. This kind of trading will improve your chance to recover losses you made in the past.
As next month itm series will loose less time decay when you are wrong, you sell this month atm series which will loose faster time decay compare to your next month series.
Such trades are called: Calendar Spreads. Even than: Also learn to adjust such Calendar Spreads in case market goes crazy and moves against any of your break even points. With out knowing how to adjust the calendar spread, you do your self not a good thing.
I know that you told in the first post of this thread that you do not hedge, but in the long run hedging this is the only way to survive and recover loses. You can strongly believe me in that.
All the best
DanPickUp
Dear Escape
You should start now with phase 3 as you never will get out of your losses with the kind of directional trading you do. As you are still in a learning stage, do it now for your own good. Phase 3 has to be:
Adjusting and handling losses.
You can do that by using this month series and next month series, even the volume on next months series is not so good.
You go long itm next month series and you do short atm when in loss with this month series. Calculate the loss you made with the itm option and add it to the atm option you sell. This kind of trading will improve your chance to recover losses you made in the past.
As next month itm series will loose less time decay when you are wrong, you sell this month atm series which will loose faster time decay compare to your next month series.
Such trades are called: Calendar Spreads. Even than: Also learn to adjust such Calendar Spreads in case market goes crazy and moves against any of your break even points. With out knowing how to adjust the calendar spread, you do your self not a good thing.
I know that you told in the first post of this thread that you do not hedge, but in the long run hedging this is the only way to survive and recover loses. You can strongly believe me in that.
All the best
DanPickUp
You should start now with phase 3 as you never will get out of your losses with the kind of directional trading you do. As you are still in a learning stage, do it now for your own good. Phase 3 has to be:
Adjusting and handling losses.
You can do that by using this month series and next month series, even the volume on next months series is not so good.
You go long itm next month series and you do short atm when in loss with this month series. Calculate the loss you made with the itm option and add it to the atm option you sell. This kind of trading will improve your chance to recover losses you made in the past.
As next month itm series will loose less time decay when you are wrong, you sell this month atm series which will loose faster time decay compare to your next month series.
Such trades are called: Calendar Spreads. Even than: Also learn to adjust such Calendar Spreads in case market goes crazy and moves against any of your break even points. With out knowing how to adjust the calendar spread, you do your self not a good thing.
I know that you told in the first post of this thread that you do not hedge, but in the long run hedging this is the only way to survive and recover loses. You can strongly believe me in that.
All the best
DanPickUp
Watching the futures and trading options is tricky business. For a better understanding of options, you must read the fundamentals in Dan's thread - "Option Trading with DanPickup"
http://www.traderji.com/options/66266-option-trading-danpickup.html
Similar threads
-
Explore Enhanced Options Strategy Analysis- Backtest Expired Options W/O Downloading From NSE
- Started by newtrader101
- Replies: 6
-
Why do some deep OTM options increase in value while less deep OTM options dont?
- Started by newtrader101
- Replies: 3
-
-
Escape's Options Trading Diary - Strategy Based (Phase 1)
- Started by escape
- Replies: 86
-