9/30/2013

Guide To Being An Investor:

http://www.dividend.com/dividend-education/the-unofficial-dividend-com-guide-to-being-an-investor/?utm_source=Dividend.com&utm_campaign=3b8fa72d0d-Dispatch_expired_trial9_30_2013&utm_medium=email&utm_term=0_5465108463-3b8fa72d0d-33811685

OptionORACLE - is free tool for stock options trading strategy analysis, built for options traders.http://www.samoasky.com/optionoracle-image/

Configure Prefered Server: http://blog.sandeeprawat.com/2013/09/options-oracle-issue-current-configured.html

Here are some basic rules and guidelines to follow with calendar trades:

1. Always check the P/L graph before placing the trade. You can use your broker tools or some free software. I generated the P/L graph using the OptionsOracle software.


2. Avoid trading through dividends date.


3. Avoid trading through major news like earnings announcements. The only exception to that rule is when you want to take advantage of the inflated IV of the front month, but those are highly speculative trades which might have a significant loss if the stock has a large post-earnings move.


4. The front month options should expire in 5-7 weeks.


5. Have an exit plan before you enter the trade. My profit target is typically 20-30% and my mental stop loss is around 15-20%.


6. If the stock reaches one of the break-even points, I would typically adjust by opening another calendar spread around the current price, converting it to a double calendar.


7. Trade stocks which are in a range or having a positive volatility skew (front month IV is higher than back month).


8. Never hold through the expiration week of the front month to avoid the gamma risk.


9. Most of the time, placing the trade with puts will be cheaper than with calls.


10. Most of the time calendar spreads work better when IV is low. Those are vega positive trades which means they benefit from increase in IV.

http://seekingalpha.com/article/437451-10-rules-for-trading-calendar-spreads

**buy a call calendar spread above the current price or buy a put calendar below the current price

VIX Options Calendar Spread: http://www.optionpundit.net/optiontrading/how-to-calculate-vix-options-calendar-spreads-margin-requirement

Calendar Spreads -
http://www.optiontradingpedia.com/calendar_spreads.htm
http://www.optionmonster.com/education/calendar_spreads.php