Comments on: Dark Pool Liquidity- Secrets of the Institutional Investors https://www.thebluecollarinvestor.com/dark-pool-liquidity-secrets-of-the-institutional-investors/ Learn how to invest by selling stock options. Thu, 05 Jan 2012 20:37:49 +0000 hourly 1 By: admin https://www.thebluecollarinvestor.com/dark-pool-liquidity-secrets-of-the-institutional-investors/#comment-464 Wed, 16 Mar 2011 22:56:14 +0000 /blog/?p=1080#comment-464 Marty,

Darkpools are being monitored closely by the SEC and FINRA. Based on articles I have read and people I speak to who are close to the situation it is more difficult than ever to take advantage of investing without transparency. I can also say the same thing about how shorting is being monitored. The system is NOT perfect but it is absolutley improved. When I come across information that is significant either way, I will definitely publish it on this site. I also agree with you that I could have phrased my concluding remark a bit better.

Alan

]]>
By: Marty Warner https://www.thebluecollarinvestor.com/dark-pool-liquidity-secrets-of-the-institutional-investors/#comment-463 Wed, 16 Mar 2011 20:38:23 +0000 /blog/?p=1080#comment-463 Alan-
Any update to this May 2009 topic of darkpools?
Thanks.

BTW, your parting comment, I think, was a little pollyannish “…Let’s keep an eye on those dark pools and ask that they not get greedy.” That’s like Greenspan saying that the banks could ‘regulate themselves’ when they were allowed to get into investments.

Marty

]]>
By: The Yield Curve: Trading Opportunities and Economic Outlook plus What is Flash Trading? https://www.thebluecollarinvestor.com/dark-pool-liquidity-secrets-of-the-institutional-investors/#comment-462 Sat, 15 Aug 2009 21:30:49 +0000 /blog/?p=1080#comment-462 […] The Next Controversy: _________________________________ In May of 2009, I wrote an article about Dark Pools and how the SEC was concerned how they may unfairly impact the average retail investors. Lately, […]

]]>
By: admin https://www.thebluecollarinvestor.com/dark-pool-liquidity-secrets-of-the-institutional-investors/#comment-461 Wed, 03 Jun 2009 19:23:56 +0000 /blog/?p=1080#comment-461 For 1-month options, I have never seen anything better than a triple. I’ve only had a few of those in twelve years of writing CCs. Doubles are more common. For those who write long term options, it is conceivable.

If anyone hits a triple, let me know and I’ll include it in one of my journal articles.

Alan

]]>
By: Eric R https://www.thebluecollarinvestor.com/dark-pool-liquidity-secrets-of-the-institutional-investors/#comment-460 Wed, 03 Jun 2009 17:43:25 +0000 /blog/?p=1080#comment-460 Okay, this makes sense. By the way, I’m just curious – have you ever hit anything higher than a triple in one contract period? I know it would have to be a pretty volatile stock to do this and possibly you would use the “turning dead money into profits strategy” if it was that wild. Some of the new Bull 2x and 3x ETF’s move like this so it may be possible. Thanks Alan!

]]>
By: admin https://www.thebluecollarinvestor.com/dark-pool-liquidity-secrets-of-the-institutional-investors/#comment-459 Wed, 03 Jun 2009 14:41:47 +0000 /blog/?p=1080#comment-459 Eric,

The formula for a second or third profit on the same option in the same contract period is:

Option resale premium – cost to buy back original option = additional profit. If you earned $96/contract for the first option and $75 on the second, your calculations in the above example would be:

96 + 75 /4000 = 4.3% 3-week return

As far as cost basis in the next contract period, I use the current market value of the stock. This way when you compare using the same stock versus another, you are comparing apples to apples. Using the amount you paid for the stock last month (higher or lower) has no relevance to your cc decisions at that point in time.

My calculations are based on one goal and one goal ony: Making the most money with the least risk at that point in time. The ESOC is designed to compute all your calculations in this manner.

My new book, Exit Strategies for Covered Call Writing gives dozens of examples WITH THE ASSOCIATED CALCULATIONS that will clarify all possible exit strategy situations.

Alan

]]>
By: Eric R https://www.thebluecollarinvestor.com/dark-pool-liquidity-secrets-of-the-institutional-investors/#comment-458 Wed, 03 Jun 2009 01:48:07 +0000 /blog/?p=1080#comment-458 Hi Alan –

Thanks for the explanation above. I had another question on this. I know one of the exit strategies you like to employ is what you call hitting a double or triple in the same contract period by buying back an option and then waiting for the stock to increase in value before selling another option with the same strike. Can you explain what the calculation would look like in this scenario? If the stock is trading at 39.99 at expiration would you still buy down the stock to $40 and use that as your new cost basis or would it be lower? Thanks again for your blog and all of the effort you put into helping the average person make great returns!

]]>