Thanks for the tip, Gis. I don't remember who wrote or said it but here it is: Justice so designs that only those who suffer learn.
I don't paper trade any more, but put on small positions to help me emotionally deal with losses. This 12 contract position cost me $312, my maximum loss. If a total loss of this magnitude will change your lifestyle, you really have no business in the options market.
Dan Sheridan always says that you have to have skin in the game, as that is the only way you get good at it. Sure, paper trade to learn the mechanics, but you don't really learn until you do it.
Thanks again,
RFH
--- In OptionClub@yahoogro
>
> Hi Robert,
>
> you say,
>
> <<I am obsessed with calendars and need some tips.>>
>
> I don't think that obsession will make you money. You need to be neutral,
> colourless and unbiased.
> Also, if you don't want to papertrade, at least don't put on so big
> positions. Two calendars would have been enough.
>
> best, gis
> P.S. If you absolutely don't want to papertrade, ask yourself why? The
> answer might be quite revealing
>
>
>
> On Sun, Feb 28, 2010 at 11:49 PM, RobertH <robhansen5252@
>
> > I've been trying sooo hard to learn calendars, and have gravitated to Dan
> > Sheridan's method of calendar adjustment. I opened a position in McDonalds
> > on the last day of December with the stock at $62.44, buying 12 of the Mar
> > 62.5c and selling the Feb 62.5c for a debit of 0.26. When the stock hit my
> > upper break even point on Feb 3rd, I peeled off half of the 62.5 positions
> > for a credit of 0.21, and initiated a new 6 call contract position at the 65
> > strike which cost me 0.49. So now I have a double calendar, all calls, at
> > 62.5 and 65. The profit loss graph looks like a boy scout tent with very
> > little sagging in the middle. Well, I couldn't get out of the trade with a
> > profit all the way to the day before February expiration even though the
> > stock was safely between my strikes. Also, my profit loss graph (at
> > expiration) still looked good. I exited the trade on February 18, closing
> > the 62.5 spread at 0.31 and the 65 spread at 0.54.
> > On paper, I was ahead $30.00 after all that trading, but factor in
> > commissions and I lost $78.84. What am I overlooking here? This should
> > have been a slam dunk. From what I see, I should have let the short Feb 65
> > call expire worthless while the March 65 call shot up from 0.60 to close the
> > week at 0.72. (Didn't know that in advance, though). But I didn't think
> > anyone holds calendars all the way to expiration.
> > Anyone with calendar experience care to take a look at this one. I am
> > obsessed with calendars and need some tips.
> >
> > Thanks,
> > RFH
> >
> >
> >
> >
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