NexusFi: Find Your Edge


Home Menu

 





Short OTM options with a stop order?


Discussion in Options

Updated
      Top Posters
    1. looks_one Skidboot with 1 posts (0 thanks)
    2. looks_two sinpeople with 1 posts (0 thanks)
    3. looks_3 SMCJB with 1 posts (0 thanks)
    4. looks_4 Atikon with 1 posts (0 thanks)
    1. trending_up 6,278 views
    2. thumb_up 0 thanks given
    3. group 4 followers
    1. forum 2 posts
    2. attach_file 0 attachments




 
Search this Thread

Short OTM options with a stop order?

  #1 (permalink)
 sinpeople 
Singapore
 
Experience: Beginner
Platform: TDAmeritrade
Trading: Options On Futures
Posts: 44 since Aug 2017
Thanks Given: 4
Thanks Received: 10

Hi folks,

Anybody here short far OTM options on futures with a stop loss order, like what is normally done by a futures day trader?

What's the pros and cons of such strategy?

Thank you very much



Best Regards
David

Started this thread Reply With Quote

Can you help answer these questions
from other members on NexusFi?
Request for MACD with option to use different MAs for fa …
NinjaTrader
My NT8 Volume Profile Split by Asian/Euro/Open
NinjaTrader
NexusFi Journal Challenge - April 2024
Feedback and Announcements
ZombieSqueeze
Platforms and Indicators
 
Best Threads (Most Thanked)
in the last 7 days on NexusFi
Retail Trading As An Industry
67 thanks
NexusFi site changelog and issues/problem reporting
47 thanks
Battlestations: Show us your trading desks!
46 thanks
GFIs1 1 DAX trade per day journal
32 thanks
What percentage per day is possible? [Poll]
31 thanks

  #2 (permalink)
 
SMCJB's Avatar
 SMCJB 
Houston TX
Legendary Market Wizard
 
Experience: Advanced
Platform: TT and Stellar
Broker: Advantage Futures
Trading: Primarily Energy but also a little Equities, Fixed Income, Metals and Crypto.
Frequency: Many times daily
Duration: Never
Posts: 5,033 since Dec 2013
Thanks Given: 4,359
Thanks Received: 10,172

Two obvious cons relate to the fact that options are not as liquid as futures, so a) a trade unrepresentative of the market could trigger your stop and b) the slippage on your stop could be high.

Reply With Quote
  #3 (permalink)
Atikon
Dublin
 
Posts: 2 since Nov 2019
Thanks Given: 0
Thanks Received: 0



sinpeople View Post
Hi folks,

Anybody here short far OTM options on futures with a stop loss order, like what is normally done by a futures day trader?

What's the pros and cons of such strategy?

Thank you very much



Best Regards
David

There are some tollerances, if they get breached no market order fill. Say you send a market order initial credit 1 USD, market fill 15 USD, CBOE will cancel the fill. Also Stops that don't trigger on bid but on trade can be deadly for your EV

Reply With Quote





Last Updated on July 11, 2020


© 2024 NexusFi™, s.a., All Rights Reserved.
Av Ricardo J. Alfaro, Century Tower, Panama City, Panama, Ph: +507 833-9432 (Panama and Intl), +1 888-312-3001 (USA and Canada)
All information is for educational use only and is not investment advice. There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
About Us - Contact Us - Site Rules, Acceptable Use, and Terms and Conditions - Privacy Policy - Downloads - Top
no new posts