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From: luvb2b (Rep: 2104) reply to singhtelecomDate: 04/02/2013 08:43
Forum: Tesla - Msg #767Thread #673514232 (Rec: 0)
just for u singh, here's an example of an options conversion i did and how it worked.

on this trade, it is related to a holding of 500 shares of tesla (just for example purposes).

with the stock at 35.25, i sold the 500 shares and sold 5 apr $45 puts for 10.50.

effectively this gets me long the stock at 34.50. to complete the conversion you need to buy calls.

the $45 calls were trading at 5c. that's the natural pair with the $45 puts on a conversion.

but because the call option pricing was so screwed up, i instead did the apr 40 calls, around 20c.

i used the full differential i collected and bought 18 of the $40 calls.

now those $40's yesterday you can easily unload at $5. so you make 1800 x $5 = $9000. meanwhile the puts drop in value too, down by $7, so there i made 500 x $7 = $3500.

so taking those 500 shares and converting carefully to options conversions which have no added risk vs the shares and no additional cost, i made $12500 on a $10 move vs. $5000 if i had owned the stock.

my daily motivational reading, what the high and mighty penny pumpers say about luv:

"any knowledge you currently have about trading, finance, accounting, etc... that i don't, are things i can fully absorb within a relatively short period of time if its really important to do so... on the other hand, i am quite certain that you are incapable of grasping even 20% of the knowledge i've gained in math, associated algorithmic coding, physical chemistry, solid-state physics, materials science and engineering over decades of study." 

"There are those who market trades, and there are those who trade markets.
There are those who follow marketers, and those who follow markets.
The marketers feast on their followers; the traders feast on the markets." -luvb2b

***Disclaimer & Disclosure***: I make no guarantee as to the accuracy or validity of information in this message. Messages posted reflect my own opinions and/or those of others, and are posted for entertainment purposes only. My messages should not be construed as investment advice. Always make investment decisions in consultation with your own financial advisor. Daytrading is not suitable for everyone. You trade at your own risk. Daytrading involves considerable risk and could result in significant losses, including losses in excess of invested capital. Any information posted here is meant for entertainment purposes only and should not be assumed to be accurate. It is expected that the readers of this information do their own research and due diligence when making trading or investment decisions. I may have long or short positions in any of the stocks that are mentioned, and these positions may change at any time.

Reply to singhtelecom - Msg #750 - 04/01/2013 14:07

Re: With all due DD / I really appreciate Sir.
I bet you had to dig hard too those messages whre trades were posted.
I was in Kuwait and now in Oman with AF so I am in and out .
If I had seen those, I could have made$$$$ . may be next pick.
Its never too late.
Dig someDD on MNKD .
CEO put millions in it and phase 3 is due in August.
Last time it was rejected by FDA for a minor thing.
could be triple by august,
I have been watching since $2.00 and still watching.
What would you like to do? Message: Endorse | Bookmark | Report AbuseUser luvb2b: Reward | Watch | IgnoreTSLA: Ignore

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