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Showing results for tags 'short'.
Found 3 results
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Good Morning. For Futures, I'd like to understand how the Implied Volatility (iVol) of a particular option chain relates to its underlying. Better to use an example: I'd like to write puts on the Dec'13 Option Chain for Natural Gas (/NG). This particular Option Chain is associated to the December Contract (/NGZ3). Obviously, I'd like to time my short position with a high iVol, ideally after a peak has occurred. My doubt is if the iVol associated with the Dec Options is tight with the specific Dec contract. One can tract the iVol for each specific contract and they all behave differently. I use ThinkOrSwim for this purpose. On the other hand, iVolatility.com provides a iVol index for the underlying as a whole. Which approach better reflects the iVol of the Option chain? Thanks,
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Hi folks - I'm hoping someone with more experience can help me get my head around a concept. I'm looking at options trading strategies, and am studying short strangles. Assuming you didn't have the ability to monitor a short strangle 24/7, you'd want to put stop losses on the position. How would one go about doing this using the spot market to render the position neutral at certain trigger points? (i.e. without limit buy/sell orders on the options themselves). So assuming you put down a short strangle on GBPUSD, you would sell a put and a call out of the money, make the premium and wait for expiry hoping the GBPUSD didn't move beyond your strike range. What limit orders should you place in the spot market in order to limit the downside of this otherwise crazy-risky position? Before anyone looks at me askance, I am not currently holding an uncovered short strangle, nor have I ever, this is a theoretical question. Many thanks in advance... Inc.
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What has worked for you as far as determining what direction to trade in -- long or short, based on the market and stock past trends? For example, do you only go short with 100% of your trades if the market is below 200 DMA? Or do you look at shorter moving averages on both the market and the stock you are about to trade, and balance out with some short and some long positions? How has your approach worked in choppy markets that are possibly establishing new trends? I'm experimenting with different variables, such as if the stock moving average over last 90 days is trending up and the market day moving average is basically flat, then I'd go long on my position, but don't go long with more than 70% of my positions... Btw, I'm a swing trader in equities only strategy, with up to 10 concurrent positions, and average hold time of 14 days.
