Let's go back to experiments on the use of options in stock speculation. As everyone remembers, experimented with selling strangles, bare fetters, coated colas and other combinations. All in all, while the results are zero. More often they close in a small plus, less often at a big loss, and until the advantage is found. But on the other hand, unnecessary body movements began to be cut off and the search narrows :)
I came to the subjective conclusion that it is better to look closely at strong stocks, hoping to keep going or, at least, for a long hesitation in place, than falling in the hope of a reversal. That's why, the rules crystallized as follows:
1) Find a share, which is much stronger than others. There are various ways to do this., for example, the same SCTR. And here, a little philosophy. We wish we could own this strong stock? Certainly. But not at the same high price, but in order to turn back time and buy this share of interest at 5 below. Но можно ведь просто продать голый the road со страйком на 4-5% below the current price and collect the premium, and if the price falls on 5%, then take possession of these shares, after all, we already wanted to buy them on 5% below.
2) But you can make it even trickier. Ведь любая stock рано или поздно корректируется, even a bit. Wait for her correction, but so that on this correction it does not fly out of the top strongest stocks. I.e, correction should not be significant.
3) Trigger to open a position (naked sale puta with a delta about 20-30 and expiration through 20-40 days) when there was a hint of a reversal from the correction.
4) Exit. Fix profit if floating profit equals 80% from the maximum possible. I.e 80% from premiums. If this condition is not met, then wait until expiration and get shares at the strike price. That is, a position must be opened with such a volume that, if anything, get a comfortable amount of shares.
For diversification, we use a portfolio of five places. If for example, there were five positions and one position was closed upon reaching the take profit, and there are four positions left, then you can open another. But what to do if promotions appear after expiration, whether to consider them as part of the portfolio or already as an independent unit, haven't decided yet. :)
Opened three positions today. This, certainly, while a little money for 1-2-3 contract. Experiment all the same.
