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Day Trading One Month Out Options. Learning To Skim The Tiniest Of Moves

This blog is different. It's about skimming small profits on one type of option in particular. It's also my story about how to make the time value of "one-month-out" options your very best friend. What I am about to try to describe to you is a phenomenon of wrongly calculated time values built into option pricings. Wrongly calculated from the perspective that some option prices (their "bids and asks") are over-sensitive to the tiniest of pricing swings. Who am I to make claims like this? What credentials do I bring to the table? I don't want to tell you as I want to keep my identity a secret. Let's just say that I have being trading options for a long time. Over the years I have learned that "nine month" or "one year out" Call options or Put options on stock's in the ten dollar price range are often mispriced. As example, I have followed the stock "Ford" for like forty years and to me it's January Call options a...
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Some Notes on Playing Apple

In my last blog I almost made it sound to easy to play Apple Calls and Puts. Let me set the stage with yesterdays and todays action. First. here is how the market was up this Thursday and here is what I did.
This chart shows Apple's Wednesday and Thursdays trading movement. I bought Puts on Apple on Wednesday at 3:13 p.m. which was June 21st only to watch Apple jump upwards in price on Thursday morning. Biden made the news saying saying "We've struck a deal" refering to infrastruture spending and everything surged upwards. Obviously I was misinformed on current events. My Puts expire on Friday (tomorrow) which means all my money in this position is at risk. Then also I was running around all day doing other things and missed a selling opportunity to get out at a slight profit. Look at how this series of Puts traded today.
What did I learn from this experience? Well I should have paid closer attention to Bidens working schedule for the day. That's something you can google that. (Caterpillar and Boeing both surged on his news of infrastructure spending). I learned that on a Thursday morning when things are going against you with any short term option position you don't throw in the towel. I learned to be patient as Apple slowly sold off in the afternoon and I was accepting of just getting back my money. Smart money can play Apple. Look at how this series of Puts sold down the the 45 cent range on the strong openinging this morning. So many option traders consider Apple options to be one of their "go to" stocks to play. Very few options priced below a dollar a contract with two or three days to go before they expire can give you such a ride for the money.

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