Cub here just bought my first option contract ... LOW $160 calls. Easier than I thought. Not big money, I'm just learning the process and fundamentals of trading options. Been watching MOS for a while now and although I should have BTD when everything tanked in March, I just bought MOS 3/15/2021 19.0 call. We'll see what happens ...
Although he'd share his positions open and closed, I doubt he'll show HOW MANY contracts he buys on each, price, etc. That will be too much personal information regarding his private account. I would never share that either. The most important thing is NOT how many contracts necessarily, but the % GAIN or LOSS which in general should be the same for most of us whether you have 1 or 1,000 contracts. Remember, for each contract you take on, the risk more than doubles. Sure. the pay doubles as well, BUT you have to measure your risk to reward for each trade. Greg I assume has a hefty trading ROLL. No guesses, but based on his trades I'd have to be at least 300K+. Who knows. Doesn't matter, the trade is the same, the RISK is what is different PER TRADER.
When he makes BUY, mark the time of the recommendation.
Remember, SECONDS count on options trading, so he makes a buy, it may take 2, 3, 5 minutes for him to email it out, you to look, think, and JUMP IN the trade. During that time PRICE can shift up or down dramatically. If I miss a trade on his timing, I go back, look at the time I got the email, subtract 5 minutes and see WHERE the underlying price for the stock, asset was when he bought and THEN I may add based on that info. Sometimes that delay works in our favor, sometime we totally miss the entry point.
Greetings lions! A question I've had for awhile is, besides finessing an option, do I need to pay any extra before being able to sell? I'm a little confused in the part that goes something like "an option gives you the option but not the obligation to buy a stock", so do I have to pay extra to buy the stock, before I sell the stock at a profit? Rip the markets face off!
Greetings bullrider, the part you quoted "obligation to buy a stock" is the technical purpose of options, but not the practical use case scenario. The option to buy the underlying stock is only exercised if you allow the option to expire (which we never do as swing traders). For example if you buy an options contract for 1 x GILD $70 CALL expiring on January 15, 2021, and then wait until that date, you would then be obligated to purchase 100 GILD shares (remember 1 CALL = 100 shares, neat leverage huh?) at $70 on Jan 15 2021 (regardless of what the price had moved to, higher or lower). Greg and his lions are pulling profits NOT by doing the above, but by profiting from the actual contract value of the options, which fluctuate short term based on the price action of the underlying share price. For example you buy the above call option and the price of GILD goes to $71, your option contract is now worth magnitudes more, much more than if you had simply spent the equivalent on the shares. But if the price goes down, the losses are similarly multiplied when you close the option. These are some basic options concepts, I'd suggest reading up a fair bit more about options trading before pulling the trigger 🦁
When he says "adding to the position" that means that he is adding 1 or more contracts at the same strike price he originally bought it at. Usually this means the price is LOWER than when he first bought and although he's ADDING to the position as it is LOWER, he is "cost averaging" his position. If he bought position 1 for $10 ($1000 investment) and the underlying asset has MOVED DOWN, he will now ADD another contract maybe at say $9.50 (an additional $950). Thus his AVERAGE of the trade become $9.75. If the underlying begins to mOVE UP, he will now be closer to the trade price or above because he averaged his position. IF HOWEVER, the price does continue to MOVE DOWN, his risk does increase. Let's put it this way, Greg would not ADD to a position as it's falling unless he had good reason to speculate that the price of the underlying WILL MOVE UP. The question will be WHEN and DO YOU have the nerve to ride it out as you watch your trade screen show lots of negative numbers until it reverses.
WHatever Greg is doing, adding I am in, with him I have the nerve to ride it. Was wondering when Greg open a position does his position is set to a 100 by default or more?
For any stock, one OPTION is always 100 shares. No matter what. However, you can select to BUY as many options as you want from 1 to infinity and some platforms, like TOS default to you buying 10 OPTIONS (or 1000 shares). I have no idea how many contracts Greg is buying, but most of us are probably not buying that many.
His CSCO trade (which I also have) is a good example. It has barely budged or moved a little down since he bought last week. It may stay there for a bit or even move down more. That means we carry an UNREALIZED LOSS during that time, meaning it's "on paper" but you haven't lost anything until you SELL. I'll admit though, it's not fun to watch your trade screen go immediately into the negative when you make a trade, BUT that is how it works....at least on most trades. Very few trades will turn positive right away. Patience is the greatest virtue a trader can have. That, and some seriously good beer at the end of the day. ;)
Wish I had your bankroll...
DIA up $0.54 for the day and my untouched options down $150. That makes perfect sense.
Cub here just bought my first option contract ... LOW $160 calls. Easier than I thought. Not big money, I'm just learning the process and fundamentals of trading options. Been watching MOS for a while now and although I should have BTD when everything tanked in March, I just bought MOS 3/15/2021 19.0 call. We'll see what happens ...
Get your earth grader out. Buy your worst percentages. I'm in, just like I think GM is doing.
my overall view on the markets and understanding of the markets has improved greatly, Thanks To Gregory
Greg, it will be great to share also how many positions you have for each so we can add accordingly if we have missed already an Alert. Thanks
Although he'd share his positions open and closed, I doubt he'll show HOW MANY contracts he buys on each, price, etc. That will be too much personal information regarding his private account. I would never share that either. The most important thing is NOT how many contracts necessarily, but the % GAIN or LOSS which in general should be the same for most of us whether you have 1 or 1,000 contracts. Remember, for each contract you take on, the risk more than doubles. Sure. the pay doubles as well, BUT you have to measure your risk to reward for each trade. Greg I assume has a hefty trading ROLL. No guesses, but based on his trades I'd have to be at least 300K+. Who knows. Doesn't matter, the trade is the same, the RISK is what is different PER TRADER.
When he makes BUY, mark the time of the recommendation.
Remember, SECONDS count on options trading, so he makes a buy, it may take 2, 3, 5 minutes for him to email it out, you to look, think, and JUMP IN the trade. During that time PRICE can shift up or down dramatically. If I miss a trade on his timing, I go back, look at the time I got the email, subtract 5 minutes and see WHERE the underlying price for the stock, asset was when he bought and THEN I may add based on that info. Sometimes that delay works in our favor, sometime we totally miss the entry point.
Totally agree
Long time follower, first time subscriber. Thank you for everything, Greg, my daily inspiration!
I got Wells Fargo 23 puts hopefully yellow stains not buying
Thank you Gregory!
Thanks Greg, same here.
Greetings lions! A question I've had for awhile is, besides finessing an option, do I need to pay any extra before being able to sell? I'm a little confused in the part that goes something like "an option gives you the option but not the obligation to buy a stock", so do I have to pay extra to buy the stock, before I sell the stock at a profit? Rip the markets face off!
Greetings bullrider, the part you quoted "obligation to buy a stock" is the technical purpose of options, but not the practical use case scenario. The option to buy the underlying stock is only exercised if you allow the option to expire (which we never do as swing traders). For example if you buy an options contract for 1 x GILD $70 CALL expiring on January 15, 2021, and then wait until that date, you would then be obligated to purchase 100 GILD shares (remember 1 CALL = 100 shares, neat leverage huh?) at $70 on Jan 15 2021 (regardless of what the price had moved to, higher or lower). Greg and his lions are pulling profits NOT by doing the above, but by profiting from the actual contract value of the options, which fluctuate short term based on the price action of the underlying share price. For example you buy the above call option and the price of GILD goes to $71, your option contract is now worth magnitudes more, much more than if you had simply spent the equivalent on the shares. But if the price goes down, the losses are similarly multiplied when you close the option. These are some basic options concepts, I'd suggest reading up a fair bit more about options trading before pulling the trigger 🦁
👍🤓
what do you mean greg should we add 1 position for each one?
When he says "adding to the position" that means that he is adding 1 or more contracts at the same strike price he originally bought it at. Usually this means the price is LOWER than when he first bought and although he's ADDING to the position as it is LOWER, he is "cost averaging" his position. If he bought position 1 for $10 ($1000 investment) and the underlying asset has MOVED DOWN, he will now ADD another contract maybe at say $9.50 (an additional $950). Thus his AVERAGE of the trade become $9.75. If the underlying begins to mOVE UP, he will now be closer to the trade price or above because he averaged his position. IF HOWEVER, the price does continue to MOVE DOWN, his risk does increase. Let's put it this way, Greg would not ADD to a position as it's falling unless he had good reason to speculate that the price of the underlying WILL MOVE UP. The question will be WHEN and DO YOU have the nerve to ride it out as you watch your trade screen show lots of negative numbers until it reverses.
Good advice👍🤓
WHatever Greg is doing, adding I am in, with him I have the nerve to ride it. Was wondering when Greg open a position does his position is set to a 100 by default or more?
For any stock, one OPTION is always 100 shares. No matter what. However, you can select to BUY as many options as you want from 1 to infinity and some platforms, like TOS default to you buying 10 OPTIONS (or 1000 shares). I have no idea how many contracts Greg is buying, but most of us are probably not buying that many.
Thank you
His CSCO trade (which I also have) is a good example. It has barely budged or moved a little down since he bought last week. It may stay there for a bit or even move down more. That means we carry an UNREALIZED LOSS during that time, meaning it's "on paper" but you haven't lost anything until you SELL. I'll admit though, it's not fun to watch your trade screen go immediately into the negative when you make a trade, BUT that is how it works....at least on most trades. Very few trades will turn positive right away. Patience is the greatest virtue a trader can have. That, and some seriously good beer at the end of the day. ;)
Graeme, you got that right!!!