Josh7

I know this may be a bit off topic since it mainly deals with option activity but I observed something unsual in an option chain on BAC. There was over 240,000 call option volume placed in a day on an option with only like 500 open interest. I know some individuals point out that this can indicate "insider trading" but someone posted on a site that it was a few large buy/write transactions with what appeared to be a captured image of the transactions(which was buy/write) from his platform. Do some brokers/platforms offer that ability to review transactions in the market?

That sounds like a good strategy. I will keep that in mind if I am confident in any company. Or even get approved to sell options. Do you know what the requirements would be in order to be approved for margin trading and selling puts and calls(or performing spreads) on TD Ameritrade? I am assuming theres a specific number for yearly income, net assets and liquid assets. Also, is this the only strategy that you has worked for you? Have you ever had much trouble with other strategies like a call backspread or protective put(hedging)?

Does anyone know the requirements in order to be approved for a Tier 2(standard margin) so I could do spreads for TDA? I took a look at the application https://wwws.ameritrade.com/cgi-bin/apps/Main. I figured they would require you have an income of $25,000-$50,000 as well as net worth of 50-90k and large number of years of experience.

November 22 GDP growth November 23 the deadline for the Super-Committee in congress to pass a budget that lowers the deficit personal income and jobless claims on the 23rd too but I believe the market will definitely react to the budget.

https://papermoney.thinkorswim.com/tos/displayPage.tos?webpage=paperMoney

ya thats exactly what I googled before posting this thread but unfortunately the few websites that I use only have the definition for it. I found this one which gives a general description:10. Stock Analysis: Quantitative Valuation | Red Cat Journal I was hoping to find a website that has more detailed information with examples. I'm probably going to see if I could check out this book from a library:

:doh: Your right! I perceived the scenario as if I were a buyer not a seller of the option. If I think a stock was going to fall and I am selling I would sell a call option. If I were to short a call in this scenario it would give me a short exposure to risk since the stock is falling as opposed to shorting a put which would give me a long exposure to risk. As the price is decreasing the value of the put contract that you sell is increasing substantially so you can lose a great amount just by waiting for the option to expire worthless/around 1-2cents if it is already $20 close to expiration.

I have been going through the same ordeal and I am still learning. I was reading different books that focused on the various ways to analyze a stock/market. Some people use fundamental analysis(looking at the balance sheet, cash flow etc. of a company), use technical analysis(to see trends in a stock) and others:boxing:. Then there are also strategies involved. The way that I have found useful is by asking questions and engaging in conversation with more experienced investors. There seem to be plenty of them on here who know a great deal. Once you fully understand it then you can create and share your own strategies which you feel comfortable utilizing. Any question can get you started just look through some of the topics. I learned about bollinger bands a few months back just by asking someone "Do you think CREE will maintain the current trend?":question: If you dont know any terms people say you can just look them up: Investopedia.com Tutorials: Building Blocks and the Basics of Investing Hopefully this helped you.:cinema:

oh ok so if you were to have looked at the head and shoulders pattern of say GMCR(assuming the method used to analyze this symbol was technical analysis) and you said ," I think this is going to go down once it breaks the support". Your view on the stock is that it will decrease in value so you "short an option" meaning you sell either a call or put. In this case it would be a put option? Lets say the stock is at $80. strike price of the put option that you short is $40. You receive 1.50 premium. The put buyer(person buying from you for 1.50) will have his contract go up in value if the stock declines correct? However, as long as the price of the stock does not go passed the strike price of $40 it will eventually decrease in value due to time decay and should be bought back at 1 or 2 cents to eliminate risk. Another way of shorting would be to short a stock(not option) to receive the premium and buy it back once the price has fallen a significant amount correct?

I dont understand what you mean by Always buy short options back when they get near zero, and remember the most you will make on them is on the day you sell them. Can you explain? I noticed that this particular level involves great risk and it would seem more logical for Sharebuilder to have a level 3 which would enable credit/debit spreads to limit risk. I was informed that each broker has their own set-up for each level. Sharebuilder's level 2 may not necessarily be the same as another online broker.

:missy: It must be the lack of sleep but I went to the same location on Sharebuilder.What I meant was that I can not sell calls or puts to receive a premium. The only option that I can sell to receive a premium seems to be a covered call(if I already own the shares). I can buy a call to open a position and sell a call to close the same position. I can also purchase a put to open a position and sell it to close a position. Thats one of the first things that came to mind. So it would be way better to merely find a stock that I want and is within a reasonable price range to perform this strategy, thanks. You make $2-$3k on just receiving premiums each month? Your options never get assigned?(especially the ones that have strike prices lower than the stocks price)

Looking to learn more about Quantitative Analysis. Is there a good website or book that you could recommend?

Thank-you I read through the post. Great strategies! I dont think I can sell naked puts :crap: . It seems like Sharebuilder is too basic, I am going to switch to TD Ameritrade. this is all I can do: Write a Covered Call Close a Covered Call Perform a Buy / Write (Buy a stock position and write a covered call) Perform an Unwind (Close a covered call and sell a stock position) All Level 1 strategies above, plus: Buy a call (to open) Buy a put (to open) Sell a call (to close) Sell a put (to close)

Hello. I had a question about covered calls. I was approved for level 2 option trading on sharebuilder(the highest level they have). The only things that I am allowed to do are buy calls/puts and covered calls. I am interested in possibly doing a covered call on QCOM buying it at around 57 and selling a Dec.17 $60 call for ~ .91 which would give me a 6.8% return in one month if assigned. The call would just be extra revenue on the stock that I expect to climb. Either that or merely purchase a call option on QCOM. 3 or 4 Jan 55 calls for 4.10/4.20 each. Any suggestions? After reading mslk's comment and assuming I can sell call's/puts. I could sell a Dec. $55 put for about $1.50 since I have no problem buying at $55 if it is excercised.

This makes it easier thank-you. It seems like this is the only option strategy that I have at my disposal since I was approved for a level 2 option trading with sharebuilder. I may have to switch to TD Ameritrade since it has more to offer.