-
Hey, guest user. Hope you're enjoying NeoGAF! Have you considered registering for an account? Come join us and add your take to the daily discourse.
Stock-Age: Stocks, Options and Dividends oh my!
- Thread starter koam
- Start date
Hmm, I just realized I am the only person in the world to buy calls today on Acergy. How does volume affect call prices? Does it just lower the bid/ask spread? I realize the OTC is the counterparty to every trade, so does this matter? How is price discovery determined when volume is non-existant?
sonarrat said:
The OTC is the counterparty for every options trade, you can always find a buyer.
Edit. So I got a good answer from a securities professional on the effect of options volume. Thought I would share.
"OTC is counterparty, but there still has to be someone on the other side of the trade for them to provide an offer to your bid, that's how the b/a is created...if it were formula, then there would never be arbitrage in options, because everything would be fairly priced. Low volume means no one is looking at ACGY that far out...call volumes are very low now because people generally looking into those right now are being forced into liquidation. Call volumes are very low / bid-ask very high the farther you go out on the option, because fewer people are playing those contracts...if you look at the same near-term contract, it will have larger volume...Big stocks have smaller b/a, because there are more people in the market ready to trade, just like a normal stock, and the volumes bigger for the same reason. Obviously it will be small for a small company, because options are generally much more rarely used than outright stock, so the options market for small stocks will be that much smaller."
toxicgonzo
Taxes?! Isn't this the line for Metallica?
Dow down another 500 today. Wooo how I love wall st.
RumblingRosco
Member
WingM@n said:
It's dropping 10 points per refresh over here. Holy shit.
RumblingRosco
Member
gkrykewy said:
Assuming dividends aren't cut too much!
kathode said:
hey this might be a personal question and maybe you don't want to answer, but i was just curious how much money are you guys investing in Option trading? you guys seem to make like 20% or greater which is good. But are you guys investing like a 1,000? 2,000? or 10,000?
i'm trying to learn option trading and it seems like you can make big returns but i also understand you can lose it all as well.
Like how much money should i look to invest if i wanted to start trading options?
thanks.
Man, what planet did these traders live on this past month when they expected the goal of the bailout was to prevent a recession.
I'm pretty sure the goal of the bailout was to prevent the mother of god financial meltdown and total collapse of the western financial system in the span of a week.
I'm pretty sure the goal of the bailout was to prevent the mother of god financial meltdown and total collapse of the western financial system in the span of a week.
jamesinclair
Banned
dionysus said:
Their extra services suck, but if you want to buy and sell theyre gold. Cheap, and on Monday they were the only site that was actually even working (TD and scott were down)
Use other sources for info.
I played around with options in my simulation account, and this is why I will stick with stocks
(October options, SIMULATION only)
Symbol Description Qty Purchase Price Current Price
ZQN JL Call on AMAZON.COM INC at $60.00 10 $0.50 $0.07
:lol
mackaveli said:
Originally I wouldn't enter a position with less than $3k. Now however, after some losses, I put about $1k or less in, which skews things for me a bit. Like today I bought around $700 worth of C puts. It shot up, but a 30% gain is just around $200, which still strikes me as chump change :lol So I'm holding. They have earnings tomorrow at 10AM. I have to be on a plane at 9:45 unfortunately. Just going to have to put in both a limit and a stop before I go.
You can definitely lose money fast as hell. See back in the thread when I bought about $6k worth of GOOG calls at $1.30. The very next morning those calls were worth $0.05.
toxicgonzo
Taxes?! Isn't this the line for Metallica?
You guys should check out UltraShort Oil & Gas ProShares (ticker: DUG). Take a look at this chart of it compared to the Dow Jones -
Chart of DUG vs Dow Jones
It works contrary to the market. Anytime the market goes up, it goes down. But when the market tanks, it goes up. I was going to buy into this today @ $52. I should have, seeing as how it ended at $62.
Chart of DUG vs Dow Jones
It works contrary to the market. Anytime the market goes up, it goes down. But when the market tanks, it goes up. I was going to buy into this today @ $52. I should have, seeing as how it ended at $62.
Fun Factor
Formerly FTWer
jamesinclair said:
What site is that?
jamesinclair
Banned
FTWer said:
http://simulator.investopedia.com
Lets you do stocks and options, of course its on a slight delay from the market.
Free though, so I use it to test out option strategies.
0% of mine have been successful.
jamesinclair
Banned
Ive confused myself
Whats the difference between a stop and a limit?
I have two stocks. I want to sell the first if it goes OVER an amount, what do I use?
I want to sell the second stock if it goes UNDER an amount, what do I use?
Whats the difference between a stop and a limit?
I have two stocks. I want to sell the first if it goes OVER an amount, what do I use?
I want to sell the second stock if it goes UNDER an amount, what do I use?