What I find option to be interesting is that it offer me second chance to be right again with adjustment strategy.
Beside using Rolling to perform repair or adjutsment , I added another repair skill into my list. It is call inversion and good for naked put, call or strangle.
I enjoyed Kirk’s video from OptionAlpha.com. He is authentic enough to show both his winning and losing option trades.
What I like about his video is that it is clear, well explained and the adjustment strategies is first-rate. I usually tune to his option trades that need adjustment.
His past live trades video https://optionalpha.com/members/live-options-trading
WFC market price was at around $51 and I decide to sell call option at $52 thinking it will drop further. The next day, my position was tested.
Management of position : One of the repair strategy I use to salvage my tested position is rolling salvaging strategy.
Interesting discussion with someone that just started selling options.
This week is interesting. I need to fix 2 trades last night:
This week I sell both stocks and E-mini S&P Index Futures and collected enough premium to feed me for a week or so.
For Stocks, basically I use the investors.com for entry and the selection criteria are:
1. High IV rank or IV percentile
2. High Volume
3. Low Spread different
4. Good ROM or ROC or ROI
5. High for OI and volume
6. Price gap or major price change supported by a big volume
7. Look for high probability setup using chart like LR, SMA, RSI, MACD, Bollinger and dynamic band
For E-minis future, I use Hips and Lops strategy for entry and let it expires worthless.
On eve of good Friday, in the middle of the night, a friend contacted me and requested for help; that friend sold a naked call on YINN at SP 45 expiring in Apr and now losing about $260 (red arrow) and seeking my help on how to salvage that tested position.