Forum Archive Index - October 2003

[fntradingsolutions <fntrade@bigpond.net.au>]

Well My risk factor is always 8% being that at any one time I risk only 8%
of my Trade Capital. So if the Trade goes against me my Maximum Loss factor
is 8% of the Investment. That is when I close the trade. i.e For a loss of
$1296.
Since the investment was  90 cents by 18 = $1620 Multiplied by 10 Contracts
= $16,200. That is my Total investment for this trade.

Now since I bought Puts I expected the Market to go Down. However if I was
wrong and the Market went up I would exit the Trade when my 8% Risk Factor
was reached. Loss would then be $1296

90 is 90 cents that is the cost of the Option  Called the Premium. 18 is the
multiple per contract.
i.e.  90 cents x by 18 is the Full cost of the Put Option = $1620  That is
the most I can lose per Option.

10 Is the number of contracts I bought

----- Original Message -----
From: "trader 100" <trader_100@hotmail.com>
To: <sharechat@sharechat.co.nz>
Sent: Friday, October 03, 2003 10:55 AM
Subject: [sharechat] Options by Woody


> Woody,
>
> I'm learning a lot from you.
>
> Can you please go through your trade in a bit more detail.
>
> What does the 18 in:
>
> 90 = 90x 18 x10
>
> represent?
>
>
> What do you mean by?:
>
> My Risk factor was locked in at 8% = $1296 .
>
> Regards,
>
> T100.
>
> _________________________________________________________________
> Surf the net and talk on the phone with Xtra Jetstream @
> http://www.xtra.co.nz/products/0,,5803,00.html !
>
>
> --------------------------------------------------------------------------
--
> To remove yourself from this list, please use the form at
> http://www.sharechat.co.nz/chat/forum/
>
>



----------------------------------------------------------------------------
To remove yourself from this list, please use the form at
http://www.sharechat.co.nz/chat/forum/