Help with ANZ put - what do I do??!!

[seaurchin]

hi WayneL ,richkid ,DTM.pcf..please can you suggest what should be done with my latest disaster or is all over...I bought puts ..yeah and it going against me ..ANZ 2206 julyo5.premium 66! obviously i have much to learn ..
could someone give opinion as to likely out come ..? and could i buy more @ this lower level 33 premium? Value? thanks for your time .

 

[DTM]

Re: Options Mentoring

Hi Sea,

I would hold for the next few days. Today its looked liked its reached the top and could meander around before dropping (my opinion).

I have June $22 puts and I'm holding on because I think that its going to retrace.

I have been known to be wrong so this is not advice.

 

[positivecashflow]

Re: Options Mentoring

hi WayneL ,richkid ,DTM.pcf..please can you suggest what should be done with my latest disaster or is all over...I bought puts ..yeah and it going against me ..ANZ 2206 julyo5.premium 66! obviously i have much to learn ..
could someone give opinion as to likely out come ..? and could i buy more @ this lower level 33 premium? Value? thanks for your time .

Has it reached any of your exit targets? If so then get out. If it has reached your technical stop loss price target or your position value exit target then follow the exit rules you should have placed before the trade when you were still sane.

 

[RichKid]

Re: Help with ANZ put- what do I do??!!

Urchin,
Just for the future, do what I do, buy a few hundred bucks worth as a trial (brokerage will be a big percentage), or none at all and paper trade- this suits me but may not suit you so think about it before making your decision.

I bought Mayne puts just before they announced the report into a the co break up (no one in the broader market knew till the annoucement)!! That's right, they're worth nothing now but because my bet was small I can survive, I still haven't figured out how to use stops with options since they move around so far compared to shares. Lots to learn alright. Most people should just bail out with little is left in cases like this rather than stressing but it's upto you.

Please be aware that responses to your remarks shouldn't constitute financial advice unless someone is qualified to give it. But other views will always be helpful so I hope you can get out alive from this one.

 

[seaurchin]

Re: Help with ANZ put- what do I do??!!

THANK YOU ...for that quick response..interesting all 3 views and will definately use it to my advantage ..wrong or right..??
my expectation before buying was it may go up to 22 abouts then have pull back to 21.00 abouts for a rounding pattern and completing its rally up...then stready for while ..funny how instantly a rocket shot the xjo up next day like as if they knew i bought the PUTS?
DTM...hope it does retrace..
PCF...umm sell /stop loss normally no worries as this is my second try @ options and today if i sell i'd recoup half my capital...only.i know could lose all..still have one month solid trading left or am i wrong..expiry july.
richkid...paper trade i did and enormous win..in 2weeks or is that a dream??
then BHP ...near 100% in week then silly me thought sell @ 20-25% profit only
..so i thought this is easy ....yeah foolish me teach me a lesson and i'll try to learn from this entry and what i did wrong...thank rich kid and dtm pcf hope wayne L has time to help. thank s again all.

 

[DTM]

Re: Help with ANZ put- what do I do??!!

Thought you'd be interested Sea. I'm getting major divergence with MACD and I'm thinking that it will drop anytime now.

Not advice.

 

[bundy]

Re: Help with ANZ put- what do I do??!!

seaurchin

Ok, I'm not going to beat around the bush and give it to you straight - in the inimitable Bundy style.

It's apparent you don't have a trading plan or enough knowledge to trade options at this stage - STOP TRADING IMMEDIATELY!

Save your dough and read and read and read and paper trade till you can trade profitably for at least 3 to 6 months - then use your savings to launch into options in a the proper, prepared way.

During this time - develop a trading plan - entry rules - exit rules - money management - a trading style that you feel comfortable with.

In your trading plan - make rule number 1 - TRADE WITH THE TREND!

Don't even think of trading counter trends for the first year or so - then think again - unless there is a clearly defined channel - but wait for confirmation always.

Trade the entry signal only - forget about all these indicators etc - a stock can be overbought/oversold or experience divergence for months and not alter it's current trend - there is no accurate predictive element in them in so far as it relates to options - just trade the entry signal as it occurs.

On the current trade - I note the short term volatility is about 25% greater than the historical volatility - so I guess you paid way over the top fop for your PUT options - don't be surprised if you get a volatility dump - that will really cruel your current sad predicament - and may not even offset some moderate price move in your way.

Finally, what you're doing at the moment is not trading options - you're punting - it's cheaper to go to the track if you want to do that.

___

Bundy

Good judgment is gained through experience.
Experience is gained through poor judgment.

 

[wayneL]

Re: Help with ANZ put- what do I do??!!

Bundy,

By short term volatility, do you mean Implied Volatility? It looks to be so.

And thats a very good point about volatilty dump (or crush) {and Implied Volatility in general}. And very immitably put I might add! Ahahahaha

People need to be aware of this phenominum...one of the numerous "gotchas" in options.

Cheers

 

[money tree]

Re: Help with ANZ put- what do I do??!!

options are a risk-limiting instrument

their intended use is as an 'all-or-nothing' trade. If 'nothing' is an unnacceptable loss, the position is too big.

 

[seaurchin]

Re: Help with ANZ put- what do I do??!!

thanks again...yeah yesterday when anz dropped to 2174 abouts i thought this would be the sell signal earlier..but today its up strongly to test 22.ooabouts ...where i expected the fall to come from the weekly chart ..still may happen?? BUT AS YOU SAY THIS iv-CURRENT VOLIATILITY DUMP MAY HINDER IT ....OR MAY BE THERES MORE IDIOTS OUT THERE LIKE ME WHO DON'T HAVE THIS TECHNICAL KNOWELEDGE AND JUST BUY OVERLY BOUGHT
STOCKS WHICH MY BROKER SAYS FAIR VALUE HERE NOT SURPRISED TO SEE IT COME OFF.
yes ..i do have much to learn about option trading..ANZ 2206 july expiry open interest 315....um its volatile trading 30- next trading up to 47-55
all in a week...22 00 by friday close will have fingerxxx for down side with sellers taking profit from this Banking rally..may june is banking season ??
thanks for all your opnions and charts of divergence..thanks again.

 

[seaurchin]

Re: Help with ANZ put- what do I do??!!

volatile is the word...today Anz hit low 2173/6 and my july 2206 were 50s then the extreme happened and it topped 22 .15 closed 22.07abouts.
You guessed it back to 31.5 ...this is where i was expecting anz to come off on close friday near 22.10abouts...I'm probably wrong and it will be a power stock and climb to 24.00?

It makes me wonder about the phrase'' what goes up must come down .''.GRAVITY in OPTIONS ..could there be such a thing???

i'm considering buying puts again and possibly the same ones ..buy low sell high ...?? anyway lots to learn .

 

[DTM]

Re: Help with ANZ put- what do I do??!!

volatile is the word...today Anz hit low 2173/6 and my july 2206 were 50s then the extreme happened and it topped 22 .15 closed 22.07abouts.
You guessed it back to 31.5 ...this is where i was expecting anz to come off on close friday near 22.10abouts...I'm probably wrong and it will be a power stock and climb to 24.00?

It makes me wonder about the phrase'' what goes up must come down .''.GRAVITY in OPTIONS ..could there be such a thing???

i'm considering buying puts again and possibly the same ones ..buy low sell high ...?? anyway lots to learn .

I've sold out of my ANZ puts and have gone the other way with MBL and CBA. I didn't buy ANZ calls because I have enough exposure but I think ANZ will go up this week. You might be ok with it since they're August (?) puts because I think there will be a correction in the near future.