How to trade SPY options

Come along with us on our journey to demystify the complex yet rewarding world of options trading. Don't be intimidated by the charts, actually they are not that hard to read and understand. We also provide the SPX Spread Trader which is perfect for those who want precise entry and exit prices. Often the greater the risk, the greater the potential gain, and that is true with our approach. No retirement plans just yet. We are trading SPX and SPY weekly option contracts on the day before and day of expiration, so this is a highly risky and speculative approach. If this event had happened later I might have scaled in and purchased more calls, but on this day one open and one closing trade did the trick.

After Hours Time (ET) "Time" is the time of the trade Eastern Standard Time. After Hours Price "Price" is the trade price of the trade.

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Come along with us on our journey to demystify the complex yet rewarding world of options trading. Many people think day trading is gambling: I agree—yet I day trade the SPY almost every day. I day trade very little capital, and I direct the profits into my less risky accounts. So why bother if day trading is gambling? Simply put, I can increase my odds of a successful return using money management techniques.

I fully expect to some day lose all of the money in my day trading account—the goal is to multiply the capital I started with many times over before that happens. This strategy works because I day trade with a tiny percentage of my entire investment portfolio, and the amount I am willing to risk remains constant—meaning that I do not attempt to compound my returns; profits are removed from the account right away.

Already this year I have doubled the money in my day trading account not bad considering that we are only 8 weeks into the year. This is what I mean by money management: Though day trading is gambling, you can leverage technical indicators and your own expertise to enter and exit trades with higher success rates. I only trade the SPY, which I have monitored for so long that my gut often predicts how it will move. I use weekly options to add leverage and reduce the capital required. This option normally has a delta around.

I try to be in a trade for 40 minutes max. Sure, sometimes a trade lasts a few hours, but I always close the trade at the end of the day no matter what. I like to enter my trades around 1: I enter a trade knowing whether the SPY is bullish or bearish on that day, and I never buck the trend: I make only one trade per day.

If I am trading more than that most likely I am either cocky and think I can make more money or I am trying to fix a loss trade—both are bad ideas. If the conditions are right I scale into a trade up to 4 times the dollar-cost average. I only scale down, never up—meaning I buy more as the price drops, and when I close the trade I sell everything I do not scale out. Doing so protects me in the case of an upward spike in the market and frees me from being glued to the computer screen.

The SPY is not crazy volatile and almost always I have some money left if a trade goes against me. You can use the best adsense alternative for any type of website they approve all websites , for more info simply search in gooogle: Your email address will not be published. Shorting Stocks Depending on your software package, you may or may not be able to short outside normal market hours. Next Post The Australian Dollar. Forgot to mention it.

Oh, actually I did mention it: Stop limit orders are queued and sent the next day, when the exchange opens. Thanks again for a great article! I look forward to reading more from you in the near future. Leave a Reply Cancel reply Your email address will not be published.

Don’t Just Be a Day Trader

Jan 24,  · Prior to the recent few days of heightened volatility, VIX call options would often fall to the day's lows just before the close of trading at SPY, QQQQ, and DIA options trade until too, but the spreads widen after Since option values are derived from the price of the underlying stock or ETP (Exchange Traded Product), once the underlying stops trading, there should be no reason for options to continue trading. However, more and more underlyings are now being traded in after-hours, and for a very few, the options continue trading as well, at least until EST. Oct 08,  · But in most cases, options can only be bought or sold during regular trading hours. A vast majority of the options on U.S. stocks trade between a.m. ET and 4 p.m ET. Most stocks, though, can be traded before or after those hours.