The Best Kept Secret For Buying Calls 

That’s what I do. Don’t get greedy and increase risk. Sometimes I miss a home run but sometimes I avoid cutting all my gains

Sounds like a good plan.

Care to share what metrics the scanner had to get this win rate? Thanks

Thanks. I'll be back to making more videos at some point. I just wanted a RU-vid break for awhile.

Thanks. I believe I was referring to the fact that as you go further OTM the options get cheaper for that particular expiration cycle.

Tough questions! If were just to buy Calls like in this video, I would probably choose the strikes which are slightly in-the-money that are 90 days away. Personal preference though. As far as overall market conditions, I try not to complicate things too much. I look at an overall 1 year chart of the major indices and draw a line for highs and lows. Is the chart showing higher highs and higher lows? Or lower highs and lower lows? Or indecisive with lower highs and higher lows? I also look at the 200 day SMA. Is price above or below it? Is the SMA sloping up or down?

@@yieldcollector sounds great. But I guess I will start with the Wheel until I feel comfortable enough.

Thanks. Yeah I'm on the paid subscription.

I depends on whether or not I thought it would go up again (looking at the chart) and what the overall market is doing. It also depends on how much time is left. I have definitely closed them early for a loss before if I think that it's the best thing for a bad situation. You can always roll it (for a loss) to a better strike and expiration, too. You could see if that makes sense. It's hard to give a definitive answer because it's situational (at least for me). Some people probably have strict rules about when to close trades. I don't really.

@@yieldcollector Thanks for your answer. Have a great day. Good luck trading.

The delta values are a quick way to see approximate probabilities. With Market Chameleon, the actual win rate of each strike is calculated using actual backtested results. That is entirely different from probabilities.

That's not what delta IS, though, or even supposed to be. Look at his chart, it shows 0.8 delta winning 50% of the time and the 0.5 delta winning 39% of the time.

@@tonyrichmond9428 I understand. But in Options world, they say, if the strike is 20 delta then 80% chance that it is going to be OTM (or 20% chance that it is going to be ITM). So, indirectly, it is the odds of winning.

@@tonyrichmond9428 Thank you for that clarification Tony!

Wow, that looks impressive.

Noted!

The sweet spot for me is like 30-50% IV.

@@yieldcollector thanks

Thanks. I usually lose money in a Bear market the same as everyone else 😁. But if you were good at knowing when the market changed, simply buying Puts or Put debit spreads would do very well.

I would like to make that because I am curious about the results as well. But this Market Chameleon option chain backtester uses the last 4 years of data to get the results. I can't really isolate it to only check during bear markets, so the overall results will look terrible because of that. Although I just checked in the list of trades in the results and the Puts performed well for 2022 for what it's worth. If you are good at market timing, buying Puts at the right time seems to be a great strategy.

I don't really buy many long Puts, if I am bearish I usually will just sell a Call Credit spread.

Yeah TSLA has been very disappointing lately.

I keep it really simple. I look if the 50SMA is above the 200SMA. It's not perfect, but that usually gives me a good idea.

I also prefer the slow and steady profits of selling options. But to each their own.

Any trader saying this is the only way is a trader no one needs to be listening to.

I have yet to meet a trader with my gains: Penny stock, low-range break, equal dollar value each company, well over 100 companies per set-up, losses cut at about 25%, first 100% gain of each stock sell half the position, unless it supernovas, then sell all on the spike's first 1-day chart head-and-shoulders top. Holding time is 1 day to 1 1/2 years. Average holding time 1-6 months. Gains/losses/fees & commissions all factored in leaves a massive profit. Tax liability is low also due the the low portfolio turnover, unlike "successful" day trader with 270 setups a year. I will put my market gains up against anyone else's.

These backtests are assuming you hold until expiration. In real life I personally wouldn't have the patience and would probably close the trades early (which is probably why I don't buy a lot of Calls 😁).

You're welcome

Yeah I use both of them. There is definitely a lot of overlap, especially since OA introduced "Trade Ideas" for manually finding trades (which is a cool feature). OA is mostly for auto trading and I use MC for finding individual trades. MC really shines when finding earnings trades (which is what I use it for most). It doesn't bother me to have 2 subscriptions since I use OA with Tradier so my OA is free.

@@yieldcollector thanks very much. I have OA as of this week and I’ll subscribe to MC. As a newer options trader (lots of years in stocks), the barrier to entry is knowledge- at least for me. The investment in these tools seems almost nothing to me compared to the gains they offer. Thanks again!

Yeah as a newer options trader, MC and OA can feel overwhelming I would imagine. For OA the live beginner workshops are great app.livestorm.co/optionalpha/beginner-demo . For MC, there is a learning curve and not many places to learn it lol. That's why I try to make videos about it. @ttfweb1

I just looked, and the backtest for EXPE wasn't good. There is a free 7-day trial if you want to screen other stocks marketchameleon.com/Subscription/Compare?pap_aid=YieldCollector

@@yieldcollector Thanks

Nice. Good luck to you.

How much did you profit

It is very stock specific. Once you get to ATM and go ITM that's when the win rate is usually best. Some stocks never make it above 50% win rate at all. It is hard to make a blanket statement about all stocks.

@@yieldcollector they must use a proprietary calculator

@@edbrandt8972 Whatever they use, it is very impressive.

Yeah that would be my guess as well.

As far as I'm aware, the backtest results are assuming you hold the option to expiration.

If I am buying a long Call I would like to see the IV Percentile (or IV Rank) below 30.

Thanks.@@yieldcollector

The backtest results from the video are showing what happens when you hold the Calls to expiration. That seems like the best way to capitalize on the huge gains. I haven't actually done much straight up Call buying. I usually only buy Calls when trading spreads. Making this video changed my mind though. I will be doing a lot of Call trades from now on. I will hold them as long as possible to try for some "Home Run" results. Easier said than done, though. As part of a spread trade, I usually close them out early when they are near full profit potential.

@@yieldcollector I never buy 6 months expiration or leap options as well. So, not sure in this market situation, the longer you hold is a good idea due to the uncertainty and time decay. Maybe, close out the position when gaining 50% (just my thought).

Yeah maybe. Hard to argue against taking a 50% profit!

Most likely.

I haven't really traded them. Although in hindsight I wish I would have, because I imagine that the strategy would have performed really well over the last year.

​@yieldcollector would've crushed! I prefer spreads - bull calls and puts recently

I buy itm Calls for a PMCC. Maybe I misspoke. I don't remember the context.

Not much as far as I can tell.

The star of the show.

I believe so, but Market Chameleon doesn't specify that.

Yeah it's possible. That was actually next up on my bot creation list.

@@yieldcollector Perfect. Thx.

@@yieldcollector You got me into the OA world. Thanks for that. I will look for this bot

Thanks. I'm just taking a break from RU-vid for a while. I'll be back to make some more videos at some point.

Not sure. Maybe most people think they're better off buying far OTM cheaper Calls instead. Also, past performance is no guarantee of future results 😁.

Yes definitely. That's why I always keep my long Call trades pretty small.

@@yieldcollector I come from the forex world and we usually collect, 2:1, 3:1 risk reward for trades but for some reason with options it’s less than or equal to 1:1? Which i don’t quite understand.

@@SimplyScalping You can understand the leverage when you look at the delta of your strike. The delta shows how much an option price would change for every $1 move in the underlying. So lets say you buy the 100 strike NVDA option that expires Oct 18th (89dte) for $24.30. That would cost you $2,430 for 1 contract which represents 100 shares. It has a delta of .80 which means that the option price will increase $.80 for every $1 move upwards. This gives you much greater leverage than buying the 100 NVDA shares outright (which would cost $11,800) .

Yeah I pretty much did the same thing when I first started.

@@yieldcollector do you have any videos for small accounts or people starting out? I'm about a year into my options journey. So far been selling puts and covered calls.

If you have a smaller account, I would recommend doing Poor Man's Covered Calls instead. I made a video about how to trade this strategy ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-ZpWGmz39pFQ.html . I also made a video on how to choose stocks for the PMCC trade ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE--oqqI05E67s.html .

@@yieldcollector what brokerage lets you do the pmcc I've tried on vanguard but it won't let me do it on there lol

I am not sure if Vanguard allows PMCC trades or not. I have accounts at TD Ameritrade and Schwab and they both allow you to do it. TD is merging with Schwab soon, so I recommend Schwab. Also, you need to be approved for trading spreads (whichever broker you choose).

Yeah you could close the positions out at 1dte. You could also close it early if it runs up a lot and you are happy with the profit.