Another Mastercard win!

Yesterday's market started off positively but it turned quite volatile - up and down for first 2 to 3 hours, and then plunge more than 270 points (for DJIA) southwards.

I was fortunate to exit early (because I'm tired and wanted to sleep early) on Mastercard (MA) yesterday, making $8 (after $2 commission in-and-out) - ya, it's only $8.

Concluding NOV trade...

I finally concluded the whole trade saga on NOV (National-Oilwell Varco). Despite the whole hiccup on MB trading platform, I made a gross profit of US$1 (ya, it's only one dollar!). And after all commission and admin fee, most probably I lost a net of US3.05!

Here's the details of the trade:

(1) Bought NOVJY (NOV Oct 145 Call) at 7.80
in anticipation of the stock split of NOV (payable on 28 Sep and execution on 01 Oct) on Friday 28 Sep

(2) Sold NOVJY (NOV Oct 52.5 Call) at 15.00
Stock Split on Monday 01 Oct and I thought I profited US$720 (as posted here on Monday)!!!

(Note: I sold at a 'profit' on MB platform, since it's a green on my position window. But the symbol part was erroneous!)

(3) On Tuesday 02 Sep, I apparently got a short position NOVJY (NOV Oct 52.5 Call) and 2 long positions NOVJV (NOV Oct 72.5 Call). These 2 long positions should be what I had on Monday instead of the 15.00 NOVJY. I bought back the short position at 13.80 and sold one long position at 3.30.

(4) Sold the other long position at 3.31
on Wednesday only after MB platform recovered the options execution (Ya, many options were in chaos with all expiration dates wronged and no option execution can be done till 11am ET).

In summary, my gross profit is only US$1.


P/S: If you think you read wrongly, you don't. MB platform gone went all the time. The last time (about 2 weeks ago), I got lesser cash balance because of their system error. Fortunately, I always screen capture everything in trading!

P/P/S: I'm going to withdraw my cash asap and switch back to IB or OX or some other trading platforms.

8 cents profit from an US$1.7K investment!

On friday, I entered a credit spread on $SPY. I 'risked' US$1,725 to earn a measly US$75 profit(which translated to only 4.3%). There's a total of 18 pairs of spreads (i.e. 36 legs).

Unfortunately, the trade was executed on optionsXpress and the commissions summed up to US$74.92! If you still don't understand what it meant, my net profit is only US$0.08!!!

Once again, Stupid me to invest US$1,725 to earn US$0.08!!!

If You're into Forex trading...

When I'm going to start a forex trading account, I realised there are so many of them online.

These are som recommendations (or maybe considered as stringent criterias) to take note:

(1) You can open a mini account. A mini account can be funded with as low as US$250 (standard account is typically US$2,500). Mini Accounts feature smaller, 10k contract sizes and leverage of up to 200:1. For new forex traders, a mini account is a great way to get started trading in a live environment.

(2) Choose trading platform that provides you the convenience to fund your account via credit card or paypal. Do take note of the relevant banking fee - paypal (typically US$0.30 + 3.9% of the transferred fund) & credit card (US$10 to US$20 convenience fee).

(3) Look for platforms that suits your lifestyle. Some provides wireless platforms so you can trade on your PDA or mobile device. Some provides web platform while some others need you to download their real-time trading software.

(4) Commission-free forex trading - Pay no commissions, only the bid/offer spread. The bid-ask spread is already the commission for them. And also trade on spreads as low as 1-2 pips on the most widely traded currencies.

(5) Live chat is available to help you anytime '24/5' when you are trading.

(6) Additional forex resources are important. Chartings, trader educations & webinars will be helpful in your trading journey.

(7) Guaranteed fills on stop loss and limit orders. Stop loss and limit orders are an important part of every trader's risk management strategy.

Look out for all these before choosing your trading platform. With the right trading platform, victory is already half-way there.

Forex.com is one good one that I use; otherwise you can consider Oanda.com or Interbank FX.

First win on New Trading Platform

Recently, I found a trading platform called MB Trading that requires only $1 commission per contract (for options). I used to trade with (and still using) optionsXpress, but the commission is at least $14.95.

I just tried using MB Trading and managed to squeeze out my first win on this platform. Here's the details:

1. Underlying Stock: FMC, trading ~93.00

2. FMC's stock is spliting 2:1, payable on 13/9 and executing on 14/9.

3. Buy to Open @ 93.06 and Sell to Close @ 93.57

4. I bought FMC Oct 90 Call at 5.30 and sold at 5.70: 7.5% profit in 42 minutes.

Typically, if I trade only 1 contract with gross profit $40 (based on the same trade), I will only make $10.10 (= $40 - 2 comm x $14.95). But now, with MB Trading, I can make $38 (commission summed up to only $2). So if you are a new options trader and trade small number of contracts, it's good to use MB Trading. Otherwise, optionsXpress is excellent for big time traders.

ps: Please note MB Trading doesn't support options spread (MB Trading is incorporating the spreads within 2 to 3 months). Anyway, the spread order (up to 4 legs) optionsXpress also costs only $14.95, so it's not too bad and OX has excellent trading infrastructure.

pps: When I trade, I usually look into the ROI percentage rather than the absolute amount. You may not think $40 is any great; but if you see 7.5% return in 42 minutes, you'll know what I mean!

ppps: Imagine you are buying stock of FMC @ 93.06 and selling it @ 93.57, your ROI is only 0.5% compared to 7.5% through trading options. You do the math.