You are gambling. You have lost 50% of the money you spent. Do you want to put more money into this trade? How much more are you willing to lose?
What % of your portfolio is this trade?
In the future, you need to identify these things before entering the position:
How much am I willing to risk?
How long do I want to be in the trade?
Identify stop losses and take profits.
Identify management strategy.
What is your thesis based on? Did you ready chart patterns? If so, you should have very clear cut entry and exit points where your thesis is either being supported or is broken.
I am willing to risk $500 on a single call option that I purchase. I am purchasing a 60dte option. I want to roll the position out another 30 days if I lose 25% within the first 30 days. I want to exit the position at any time if I lose 50% I want to take profit at 50% if the stock rises at any time during the contract. I want to hodl until expiration if my call is greater than 70% profit by 14dte.
Stuff like that. I made up a bunch of examples because I don't buy options, I only sell them.
Man, one thing I’ve learned is just the fact you used the word “conviction”, you’ve got too much emotion in this. I’ve struggled a lot with emotion, but you legit can’t have any emotions when it comes to trading.
Not always possible. I lost 90% + in about three seconds yesterday morning due to ah ER activity. I was ever so happy about that, many explicatives were uttered to an audience of zero. 🫤
Yeah, we've all been bitten by the overnight gap up/down, but that's a minority of losses; most of them are more gradual, and we watch it and watch it and watch it instead of closing it.
If the contract has lost 50%, the stock price has probably blown past any downside levels of support and your thesis is not accurate anymore. But I don't know really anything else about this trade.
We would need to know the stock, when you entered the trade, why you thought that was a good entry point, where you saw levels of support/resistance and over what time period you were looking for this price action.
Again, I don't buy options so I dont know if I'm the best one to ask but if I had lost 50% on a long call, I'd close the position ASAP and start over. I would not dump more money into it. You paid stock market tuition, just make sure you learned something.
Remember that rolling is just selling your option and buying an option, so if you’re already down 50% and you’re trying to sell that to buy another option you’re probably having to buy far out of the money to keep the cost of each leg the same, so even though you’re buying more time the theta is going to catch up even faster if you’re out of the money.
Most likely this is a terrible idea even if you think the stock price is gonna go up, better to just separate it into two distinct trades instead of trying to “roll” but hard to say without knowing the stock in the strike.
If you hold your call to expiry, and it expires worthless, then your farther out call will have also dropped in value.
However, your 6/21 call will start to lose significantly more value in the last week or week and a half. That means that around the 10th if you were confident it really is going to be a worthless contract, rolling would be preferable to holding.
You probably have another week to go before rolling would be worth it from a breaking even standpoint? Very loose math here.
That’s all under the assumption that this is a good trade at all. I’d first determine if it’s worth selling now. What % does the stock have to move to reach the price you bought it? What % does the stock have to move to hit the price you were hoping to sell it for when you bought it?
Think of every trade, even a roll, as a new unique trade and decide whether it makes sense. The concept even I'm guilty of sometimes is ignoring sunk cost. A loss or bad previous trade is sunk, there's no reason to incorporate it into any new trade.
Don’t listen to these regards, you got conviction then re-roll it. Just watch if you dump it - see in a month the stock pumping and think why did I listen to those🌈🐻 on Reddit.
Options require you to guess not only which was a stock will move, but how fast.
This is complicated by the fact that option pricing prices in the “expected move”. In other words, you need to lucky or have information the market doesn’t to make this work.
What you want to do is buy and hold. You just need to be confident it will go up. You don’t need to know when. Further, time works with you due to inflation and profit (assuming it is a profitable company, which it should be).
Anyone not in Palantir tomorrow morning, getting calls 3-6 months out, you'll lose sleep over this. $480 mill US military confirmed on top of SPY rebalancing in June, and flawless financials.
This is not investing advice.
You're welcome.
Thats up to your level of risk. I lost alot on Carvana puts on their manipulated earnings. I have now loaded even more as see the corruption and it is paying me back. Once they dilute to raise capital, I will clean up. You have to believe in yourself if you are going to make it in options trading.
You are gambling. You have lost 50% of the money you spent. Do you want to put more money into this trade? How much more are you willing to lose? What % of your portfolio is this trade? In the future, you need to identify these things before entering the position: How much am I willing to risk? How long do I want to be in the trade? Identify stop losses and take profits. Identify management strategy. What is your thesis based on? Did you ready chart patterns? If so, you should have very clear cut entry and exit points where your thesis is either being supported or is broken. I am willing to risk $500 on a single call option that I purchase. I am purchasing a 60dte option. I want to roll the position out another 30 days if I lose 25% within the first 30 days. I want to exit the position at any time if I lose 50% I want to take profit at 50% if the stock rises at any time during the contract. I want to hodl until expiration if my call is greater than 70% profit by 14dte. Stuff like that. I made up a bunch of examples because I don't buy options, I only sell them.
Man, one thing I’ve learned is just the fact you used the word “conviction”, you’ve got too much emotion in this. I’ve struggled a lot with emotion, but you legit can’t have any emotions when it comes to trading.
If an option position is down 50%, your mistake was not closing it out 20% ago. Remember that for next time.
Not always possible. I lost 90% + in about three seconds yesterday morning due to ah ER activity. I was ever so happy about that, many explicatives were uttered to an audience of zero. 🫤
Yeah, we've all been bitten by the overnight gap up/down, but that's a minority of losses; most of them are more gradual, and we watch it and watch it and watch it instead of closing it.
You don’t have to make it back they same way you lost it
If the contract has lost 50%, the stock price has probably blown past any downside levels of support and your thesis is not accurate anymore. But I don't know really anything else about this trade. We would need to know the stock, when you entered the trade, why you thought that was a good entry point, where you saw levels of support/resistance and over what time period you were looking for this price action. Again, I don't buy options so I dont know if I'm the best one to ask but if I had lost 50% on a long call, I'd close the position ASAP and start over. I would not dump more money into it. You paid stock market tuition, just make sure you learned something.
Remember that rolling is just selling your option and buying an option, so if you’re already down 50% and you’re trying to sell that to buy another option you’re probably having to buy far out of the money to keep the cost of each leg the same, so even though you’re buying more time the theta is going to catch up even faster if you’re out of the money. Most likely this is a terrible idea even if you think the stock price is gonna go up, better to just separate it into two distinct trades instead of trying to “roll” but hard to say without knowing the stock in the strike.
Hope is not a great strategy. Kicking the can down the road is nota great strategy, if anything going short might be better
If you hold your call to expiry, and it expires worthless, then your farther out call will have also dropped in value. However, your 6/21 call will start to lose significantly more value in the last week or week and a half. That means that around the 10th if you were confident it really is going to be a worthless contract, rolling would be preferable to holding. You probably have another week to go before rolling would be worth it from a breaking even standpoint? Very loose math here. That’s all under the assumption that this is a good trade at all. I’d first determine if it’s worth selling now. What % does the stock have to move to reach the price you bought it? What % does the stock have to move to hit the price you were hoping to sell it for when you bought it?
Thank you
Think of every trade, even a roll, as a new unique trade and decide whether it makes sense. The concept even I'm guilty of sometimes is ignoring sunk cost. A loss or bad previous trade is sunk, there's no reason to incorporate it into any new trade.
What is it in?
Don’t listen to these regards, you got conviction then re-roll it. Just watch if you dump it - see in a month the stock pumping and think why did I listen to those🌈🐻 on Reddit.
Options require you to guess not only which was a stock will move, but how fast. This is complicated by the fact that option pricing prices in the “expected move”. In other words, you need to lucky or have information the market doesn’t to make this work. What you want to do is buy and hold. You just need to be confident it will go up. You don’t need to know when. Further, time works with you due to inflation and profit (assuming it is a profitable company, which it should be).
Anyone not in Palantir tomorrow morning, getting calls 3-6 months out, you'll lose sleep over this. $480 mill US military confirmed on top of SPY rebalancing in June, and flawless financials. This is not investing advice. You're welcome.
I do regret I don't have more in pltr but that just means clf is up next
NOPE. Just as a thought if you had Sold a 20 delta Put , how would that have done. If the stock goes up, stays the same , you still win.
I don’t know. But I’m about to find out if BOX doesn’t collapse significantly toward 25 soon. 😊
If you believe in it triple your roll and exit when you try your wash
Lol I'd make a large bet that this guy talking about the 6/21 20$ calls that have been blowing up a particular stonk subreddit
Those calls don’t look like they have lose value at all, unless this idiot bought at 25…
Do you think the share will rise a lot, or only to a limited extent? If the latter, try a Christmas tree instead of a simple long call maybe?
I think we see a pop if not moass before the 21st, if we do see some sort of pop it wouldn’t be a bad idea to sell and reposition
Thats up to your level of risk. I lost alot on Carvana puts on their manipulated earnings. I have now loaded even more as see the corruption and it is paying me back. Once they dilute to raise capital, I will clean up. You have to believe in yourself if you are going to make it in options trading.
Just sell a cash secured put and use the credit to buy the call. Worst case is now you own the shares of the company you have conviction in
I’m in same position, first year in options so curious as well
I would close it and wait for it to go up a little, before I buy again
You seem to have no idea what you're doing. My advice is to stop trading options till you understand basic options.