WYNN options - 77% within 2 hours

As the earning results was supposed to be announced after market close yesterday, I entered into trading the options of Wynn (yup, the casino operator).

I entered a bit earlier for this gapping trade, but I also placed a Sell Limit (if it happened to hit it before market close). The Sell Limit was executed before market closed.

WYNN 120 Call - Bought @ 0.90, Sold @ predetermined limit 1.60 (77% within 2 hours)

Postive Mental Attitude

I never did consider playing stocks alone, since I knew the leverage of options and forex. But since last friday, I 'indulged' myself in trading stocks like Bear Sterns (BSC) and Countrywide (CFC). I personally take these as mid-term investments.

Despite having the good-nature of no-expiration, we knew that stocks are typically more expensive, less leverage instruments as compared to the 2 other mentioned tools. But, now as the market is at the down swing and the prices of stocks are cheaper than some popular options, I think we should not shut the door to stock trading which most people associate it with negative thoughts!

WHEN YOU CLOSE THE DOOR OF YOUR MIND TO NEGATIVE THOUGHTS, THE DOOR OF OPPORTUNITY OPENS TO YOU.

It's widely known that negative minds cannot conceive exciting new business opportunities and solve difficult problems. These activities require a positive belief in yourself and your abilities.

It is the nature of opportunity that it simply refuses to attach itself to negative thinkers.

When you approach every challenge with a Positive Mental Attitude, you will always discover opportunities that others have overlooked.

'Straddle' Forex Win - 55 pips

I was with my PDA at Raffles City Fountain and I was waiting for the signals to trade my favourite currency pair - GBP/USD.

As I was quite impatient to wait for the currency pair to give me the exact indication to enter the trade, I resorted to using Straddle* method and exited with a net win of 55 pips.


GBP/USD
Short @ 1.9570, stop loss 43 pips, Closed at predetermined profit take 1.9500 (+70 pips)
Long @ 1.9573, profit take 38 pips, Closed at predetermined stop loss 1.9558 (-15 pips)
55 pips win


* Straddle is basically an Options trading strategy to trade options when you don't know which way the stock will head but you know it will move big magnitude in one direction. And thus, you buy a call option and a put option at the same time. You may lose on one option, but you win more on the other option.

Another 25 pips!

US Stock market is not opened today. I went into forex during the US stock market instead.


USD/JPY: Short @ 106.07, Closed @ 105.91 (16 pips)
GBP/USD: Short @ 1.9469, Closed @ 1.9461 (8 pips)
EUR/USD: Short @ 1.4480, Closed @ 1.4479 (1 pips)

My confession: My mistakes!

I went into RIMM call options yesterday, making several mistakes in this trade.

1. The stock price should hit 91.50 (my trading criteria), and I entered the trade with 2 call options at 90.90 (first entry).
2. I entered again with my third call option at 90.71, thinking it will hit 91.50 soon.
3. It's the expiration Friday and yet, I bought into the current day expiring options.
4. Volatility was so high that Dow Jones rose more than 120 points and dropped more than 120 points (i.e. 240 points move within 2 hours) later.


I was purely speculating and I lost my own trading rules. And as an experienced trader, I was wrong to do something like this. As a result, I lost US$379 in 2 hours.

14.3% MER options profit within 45 minutes & 5 pips from EUR/USD

Merrill Lynch & Co. (MER) recorded its biggest quarterly loss since being founded 94 years ago after the world's largest brokerage took almost $15 billion worth of write-downs from bad subprime mortgage bets.

That caused Merrill Lynch to post a net loss after preferred dividends of $9.91 billion, or $12.01 per share, compared to a profit of $2.3 billion, or $2.41 per share, a year earlier. Analysts—who have had a hard time ascertaining just how steep losses would be for Wall Street banks—had been forecasting a $4.93 per share loss, according to Thomson Financial.

Imagine -$12.01 vs. -$4.93. It's a big earning disappointment! I went into MER put options when the stock price was 51.25 and got out at 50.85 within 45 minutes.

MER Jan'08 50 Put (MERMJ) - Enter @ 0.70, Exit @ 0.80 (14.3% profit)

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Within the next minute, I also closed another forex trade on EUR/USD.


EUR/USD - Short @ 1.4683, Close @ 1.4678 (5 pips)

NASDAQ Day: RIMM & AAPL - 5% wins!

A triple-digit Dow gain greeted the opening bell, and the market didn’t look back (at least until now).

Anyway, today is my NASDAQ day: I went into Research In Motion (RIMM) and Apple (AAPL), closing both tickers with 5% wins each.


RIMM Jan'08 95 Call (RULAS) - Enter @ 3.80, Exit @ 4.00 (5.3% profit)
AAPL Jan'08 185 Call (APVAQ) - Enter @ 2.31, Exit @ 2.43 (5.2% profit)

p/s: The RIMM was a roller-coaster ride. The lowest option price upon entry was only 2.60.

INFY - 6.7% win on a Dow Down Day

The day looked promising at the start, with Bank of America (BAC) confirming the rumored purchase of Countrywide Financial (CFC). However, investors had other things boggling their minds:
1. American Express (AXP) taking a fourth-quarter charge,
2. The New York Times reporting that Merrill Lynch (MER) may have to deal with a substantial write-down in the fourth quarter.

The end result of all this news was a rather sizeable drop of 246 points from the Dow.

For me, I entered into Infosys (INFY) yesterday on this Dow Down Day (DJIA dropped 240+ points). I entered at 1am (Singapore time); I couldn't stay awake till a decent profit take and thus, I placed my profit take and went to sleep.

INFY Jan'08 40 Put (IUNMH) - Enter @ 0.75, Predetermined Exit @ 0.80 (6.7% profit)

101 pips

Opening the new year with 2 forex GBP/USD trades...


GBP/USD - 1st Short @ 1.9797, close @ 1.9734 (63 pips - 106 minutes)
GBP/USD - 2nd Short @ 1.9755, close @ 1.9717 (38 pips - 21 minutes)

Payroll Time!

Yesterday, Payroll data rolled in before the market opened, reflecting a better-than-expected jump as the economy added 94,000 jobs in November. The data had many investors asking, what does the payroll data mean for the Fed?

When the closing bell sounded, the Dow Jones Industrial Average (DJIA – 13,625.6) tacked on nearly 6 points, a paltry gain of 0.4% for the session. Despite a scant gain for the day, the Dow added 1.9% for the week. To end this week on a positive note, the Dow overtook its 10-week and 20-week trendlines for the first time since the end of October.

The uneven stock market yesterday didn't provide good opportunity to trade options, but the payroll data did offer a good spike up for the forex players! It's good to be a options and forex trader at the same time.

2 wins on a single ticker (CRDN)

Been trading forex and backtesting all these while, it's been a long time since I traded options. My last options trade was a $8 win (after comm.) on Citigroup (C) last Monday (19 Nov).

Today, I went in CRDN at 2 separate occassions on a single ticker and scored 2 wins.

CERADYNE (CRDN)
Straight ITM Dec-07 50 Call
(Personal Account) Entry 3.10 Exit 3.40 (9.7% profit within 70 minutes)
(Managed Account) Entry 3.20 Exit 3.40 (6.3% profit within 90 minutes)
My compelling reason to trade: CDRN is upgraded to Buy and target raises to $73!
Day trade based on TCT

What you see on IB is not what you get!!

Options traders, who also trade forex on Interactive Brokers, take note:
- What you see is not what you get.
- What you see is not even close to what you get.

I just closed a USD/CHF Long position at market price 1.1026 when the display bid price is 1.1050. I entered at 1.1012 yesterday. My 38 pips became 14 pips only.

And also, I just entered Short into USD/JPY few minutes ago, and the bid price is 108.42. I set limit to 108.44 (knowing the discrepancies) and it got executed only at 108.49. 5 pips loss before anything start!

Options Trading Championship 2007

Take a look at the CNBC report on the OTC2007 (yup, the one my team got 2nd!). You can also see our team photos at http://www.freely.com/options-trading-championship.html.

p/s: You can see me at -1:45 frame. Haha.

Today's Trade

CARDINAL HEALTH (CAH)
Straight ITM Nov-07 65 Call
Entry 2.45 Exit 2.75 (12.2% profit)

WEYERHAEUSER (WY)
Straight ITM Nov-07 70 Call
Entry 4.20 Exit 4.80 (14.3% profit)

Both are Day trades today (29-Oct) based on TCT!


p/s: I'm still longing POLO RALPH LAUREN (RL) and EUR/USD (for almost 10 hours already!) now.

OTC2007 Billionaires

I participated in the Options Trading Championship 2007 on 17 to 19 Oct 2007. And my group, Billionaires, won the 2nd place in the group category!

p/s: In case you are thinking what we won, we won a not-so-great thumbdrive from BOX (Boston Options Exchange). Disappointed!!

Trades these 2 days

Small Wins

RCL (Royal Caribbeans Cruises)
Straight ITM Nov-07 40 Call
BTO 2.50 STC 3.20 (28% profit)
Day trade on Monday 22-Oct based on TCT

AAPL (Apple)
Bull Call Spread Dec-07 175/185 Call
Entry 3.75 Exit 7.30 (95% profit)
Earning trade on 22/23 Oct

OXPS (optionsXpress)
Straight ITM Nov-07 27.5 Call
BTO 1.10 STC 1.10 (No win no loss)
Earning trade on 22/23 Oct

MT (Arcelor Mittal)
Straight OTM Nov-07 80 Call
BTO 2.70 STC 2.90 (7.4% profit)
Day trade on Tuesday 23-Oct based on TCT

FCX (Freeport-McMoran Copper & Gold)
Straight ITM Nov-07 110 Call
BTO 5.95 STC 6.20 (4.2% profit)
Day trade on Tuesday 23-Oct based on TCT

I just long into AMZN, BCR, CME and NOV today!

MIA for a week!

Have been MIA for a week for a couple of reasons:

1. I'd been very very busy with ACME MADE and iLuv.
2. I was in Options Trading Championship for the nites of Wednesday to Friday, trading real cash. Make 2% profit on a Dow Down Week!
3. Lose quite a bit of money on my family account, so really not in the mood to do any posting!

Will be back soon!


p/s: Anyway, I profited quite a lot from ISRG (132%, 1 day), NOK (47%, 1 day), STLD (64%, 30-minutes) and NE (68%, 1 day) last week too!

13 Retirement Myths

I realised the CNNMoney.com Retire Rich series will have this type of retirement (with money) articles every now and then.

Take a look at this article under CNNMoney.com Retire Rich. Personally, I totally agreed with some of the myths as mentioned:

#3 - Everyone has debt
#4 - A million dollars will cover you
#5 - Boomers will crash the market
#6 - Without a pension, you're doomed

After reading this article, I MUST have many many millions and MUST not have debt. I won't need any pension (or CPF) and even when the market crash, I can trade PUT options to win the market!

Internet Options Trading Contest

The internet marketing world is fascinating and constantly evolving. You now see an internet marketing campaign for a options trading course.

This is how I got linked from here and there:
1. I purchased Avi Frister's Forex Trading Machine eBook and Videos.
2. On his regular e-newsletter, he introduced Bill Poulos' Forex programme.
3. And now, Bill introduced this contest to me!

Here's the contest link by AJ Brown - for you to post a comment below and answer these two questions:

1. WHY do you want to become a world-class options trader (besides the money)? What does all that money get you?

2. HOW will going to my Million Dollar Options Trading Intensive and participating in my 6-month immersion Apprentice Program help you?

Yup, the best entries (as judged by AJ) will get (1) One FREE ticket to the Million Dollar Options Trading Intensive (valued at $2,495.00) and (2) FREE entry into the 6-month Apprentice Program starting in January 2008 (valued at $2,495.00).

Though I knew the odd is low, but just for the fun of it. I just joined. I'm the #156 entry!



My original unmoderated answers to the 2 questions:

(1) I started trading options at the age of 21. The amount of leverage is somewhat one of the highest among all the financial tools. During these few years, I started a magazine publishing business and a couple of smaller busines, but none of these provide me the ease of lesser manpower problems and all other typical brick-and-mortar businesses had. Options trading has always provided me the luxury of working at home, spending more time with my family and friends and have a more fulfilling life. As mentioned in my blog imgoingtoretireby26.blogspot.com and as the world-class options trader, I’m going to use options trading as my main vehicle to achieve financial freedom and abundance and YES, semi-retire by the age of 26 (now, I’m 25!).

(2) Through the Intensive course and Apprentice programme, I can realise my dreams to retire with my whole family on time and scale a greater height in options trading. I always believe options trading is not just about the money and the trade; it’s a journey of discovering oneself. Which is why trading is not just an transaction of cash and positions; it’s a transaction of fear, greed and all sorts of human emotions that come to trade!

My first RIMM!

On wednesday when RIMM (the Blackberry company) was at $95+, I decided to buy an October 105 Call option. It's 2 steps out-of-the-money and it supposed to cost me $4.40. I'm quite keen to get RIMM but yet, I'm unwilling to fork out $440. I set a limit price at $3.85 and went to sleep at 1.30am (SG time). Haha, the limit price was executed around 3.30am at $3.85.

RIMM is expanding into China, with 2 new great products coming into the market and with very strong stock momentum. On thursday, stock price rallied to close at $100.50 (a jump of $4 plus) in anticipation of the company's Q3 earning report after market close.

Industry estimate (based on Briefing.com) was 0.49 and RIMM reported 0.50 with upside guidance. On friday, the stock gapped up $7.19 on the opening bell and next, it passed the criteria for guaranteed profit as determined by The Chicago Trick slightly before 11am ET.

And me, I made a 136% profit (my highest in recent days) when I close the position $9.10. RIMM continued to rally to the $114 region and the option i trade hit around $10.50 or more.

My first RIMM!