108: Rolling Up Strike Prices vs. Closing Out Trade - What Should I Do?

The Option Alpha Podcast

Kirk Du Plessis

Education, Options Trading, Trading, Investing, Stock Market, Business, Finance

4.8 • 1.2K Ratings

🗓️ 3 November 2017

⏱️ 29 minutes

🔗️ Recording | iTunes | RSS

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Summary

Show notes: http://optionalpha.com/show108 If you trade options longer than ten days you'll undoubtedly run into a scenario where you get challenged by a stock moving either higher or lower against your position. When this happens the first question many people ask is "Do I start rolling up strike prices and adjust the position or work on closing out the trade completely at a loss?" Naturally, we are in the camp where we believe, and our backtesting confirms, that rolling your strike prices c...

Transcript

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0:00.0	You're listening to the Option Alpha Podcast from Option Alpha.com where we show you how to make
0:06.3	smarter trades learn how the stock market really works and generate consistent monthly
0:11.2	income. Now your host and head trader at
0:15.0	option alpha.com Kirk depluses.
0:20.0	Here we're on this Kirkier again from option alpha.com working every single week to make this the most popular investing
0:25.6	podcast offered online and in iTunes because it's based on one thing and one thing
0:29.6	only and that's helping you guys make smarter traits.
0:32.5	So again, thanks so much for tuning into today's episode.
0:35.4	Even though my voice is a little raspy
0:37.1	because I'm just getting over a cold,
0:39.1	I wanted to talk about it in today's show,
0:41.2	Number 108, the difference between rolling up your strike prices
0:45.6	versus just closing out of your trade.
0:49.1	And I think we should have a nice discussion about this because we get this question a lot. I think especially newbie traders actually people who have been trading for a while they don't understand why we roll up trades, why we roll strikes and adjust positions,
1:03.0	and what the process is behind that,
1:05.0	and how it ultimately might help you generate more money
1:09.0	because it might adjust your position from a loser to a winner,
1:12.0	which is always good stuff. So we always want to see. your position from a loser to a winner, right?
1:12.5	Which is always good stuff.
1:13.5	So we always want to see if we can take something
1:15.8	that could have been loser to begin with
1:17.9	and adjust it into a winner or at least cut the loss down,
	...

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