Първоначално изпратено от bate Goiko
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my short-term strategy is called behavior and event driven trading.
I am looking for clear strtural trends or clear fundamental mislocation due to non rational behavior.
eg. K+S AG. clear stupidity.
high volatility in the morning with the share premarket around 23. options are priced at that time very expensive (big spreads), so awaited the official start and went around 24 in with call options. price of the option with strike at 26 was around 58 cents. my target is 26. at lunch time the price recovered to 25. sold the options at 74 cents. 27.5%. i bought also share at 24 which i keep with target 26.
around 17.00 where shares come under pressure bought the same option at 53 cents and sold now in the evining where shares tend to recover at 64 cents. 20%
why options? you can leverage through the volume.
so, in essence look for big moves which are claerly exaggregated.
This is not day trading but more behavior trading which is well documented due to human irrationality.
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