Ben, you couldn't be more right about the prices I received being the worst of the day. I just didn't know how to exit this trade properly. In fact, if I can't place a 4-let order in the platform, I just seem to screw up every time. This particular trade was in the OptionsXpress account, and the platform doesn't accept double calendars. Just need more experience in legging, I guess. Love the graphics and thanks for the input.
RFH
--- In OptionClub@yahoogro
>
> I already sent this reply once, but for some reason it did not get posted. So, once more, with feeling...
>
> I input your trade into my Optionetics Platinum acount (NO, I am NOT an employee of Optionetics, just a 10+ year customer) and generated a risk graph. Note that the prices in the risk graph picture are closing prices. I uploaded a picture of the risk graph in the File section entitled:
>
> MCD Dbl Calendar - 2-18-10.png
>
> So, it looks to me like you may have chosen the absolute wrong time of day to exit the trade.
>
> I hope this helped.
>
> Ben
>
> --- In OptionClub@yahoogro
> >
> > What happened with volatility over the course of the trade? Aren't
> > calendars long vega? -cg
> >
> > On Mon, Mar 1, 2010 at 5:31 AM, Meuter Gisbert <gismeu@> wrote:
> >
> > >
> > >
> > > 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
> > >>
> > >>
> > >>
> > >>
> > >> ------------
> > >>
> > >> The goal of TheOptionClub is to provide a forum for members to work
> > >> together for the purpose of furthering our individual understanding option
> > >> trading. All messages and postings, and any materials circulated are
> > >> provided for discussion and educational purposes only. No statement
> > >> contained in any materials from TheOptionClub should be considered a
> > >> recommendation to buy or sell a security or to provide investment, legal or
> > >> tax advice. All investors are encouraged to consult a qualified
> > >> professional before trading in any security. Stock and option trading
> > >> involves risk and is not suitable for most people. There is no guarantee
> > >> that any information provided is accurate and, may in fact, be wrong. It is
> > >> understood that the participants in TheOptionClub have varying backgrounds
> > >> and degrees of experience in option trading, and that regardless of
> > >> experience each member is considered a student. As such, any information
> > >> distributed through TheOptionClub should be considered with a critical mind
> > >> and not relied upon as an authoritative source.
> > >>
> > >> To unsubscribe from TheOptionClub, send an email to:
> > >> OptionClub-unsubscr
> > >>
> > >>
> > >>
> > >>
> > >
> > >
> > >
> >
>
To unsubscribe from TheOptionClub, send an email to:
OptionClub-unsubscribe@yahoogroups.com
No comments:
Post a Comment