CMG Put Spread for Dec OpMo

Posting: 4 Dec 07

ZACK had 4 buy stocks today which I used the Jon Schiller filter to select one potentially profitable Put Spread for the remaining 2 and half weeks of the December Option Month. The underlying stock is: CMG, a Mexican fast food chain. The Put Spread is:

Buy 4 Put 125 (CMG XR) & Sell 4 Put 130 (CMG XE) at a Spread value of 1.45, Initial Credit = $275, Margin = $2,000, % Return on Margin = 28.29%

If CMG = 136.05 at 10AM PST today closes above 130 on Friday 21 Dec 07, then the profit for this trade would be = Initial Credit, or $275 net with the TradeKing commission deducted when position is executed.

Jon Schiller’s HseZackFilter.xls Software which is included free with my SelfAdapDTE4.xls software package.

Good trading for the Dec 07 option month,

Jon Schiller, PhD, Author

Option Trading Credit Spreads for Dec 07 & Jan 08

Dec 07 & Jan 08 Growth Stock Option Credit Spreads

30 Nov Jon Schiller Filter using JS Software: HseZackFilter.xls

Hsu Growth Stock List: LFC, CHL, CEO, RIO, FMCN, EDU, SNP, SFP, TSM

Filter Results:

• 4 Credit Spreads to Consider for last 3 weeks of Dec Option Month
• 4 Credit Spreads to Consider for Jan 08 Option Month

	Best on %Ret DEC
CEO	Dec P180/175	3.40	InitCrdt =	$1,346	Margin =	$2,000	%Ret =	67.29%
RIO	Dec P35/32.5	0.95	InitCrdt =	$366	Margin =	$1,000	%Ret =	36.58%
LFC	Dec P80/75	1.80	InitCrdt =	$706	Margin =	$2,000	%Ret =	35.29%
CHL	Dec P90/85	2.02	InitCrdt =	$794	Margin =	$2,000	%Ret =	39.69%
STP	Dec P55/50	1.75	InitCrdt =	$686	Margin =	$2,000	%Ret =	34.29%
TOT =				$3,897		$9,000		43.30%

	Best on %Ret JAN
CEO	Jan P180/175	1.80	InitCrdt =	$706	Margin =	$2,000	%Ret =	35.29%
RIO	Jan P35/32.5	1.05	InitCrdt =	$406	Margin =	$1,000	%Ret =	40.58%
LFC	Jan P80/75	1.20	InitCrdt =	$466	Margin =	$2,000	%Ret =	23.29%
CHL	Jan P90/85	3.00	InitCrdt =	$1,186	Margin =	$2,000	%Ret =	59.29%
STP	Jan P55/50	3.70	InitCrdt =	$1,466	Margin =	$2,000	%Ret =	73.29%
TOT =				$4,229		$9,000		46.99%

Zack Growth Stock List: AAPL, WPZ, NOK, LEA, PLXF, RDY

Filter Results:

• 4 Credit Spreads to Consider for last 3 weeks of Dec Option Month
• 4 Credit Spreads to Consider for Jan 08 Option Month

• 	Best on %Ret DEC
  AAPL	Dec P180/175	1.90	InitCrdt =	$746	Margin =	$2,000	%Ret =	37.29%
  WPZ	Dec P40/35	0.55	InitCrdt =	$206	Margin =	$2,000	%Ret =	10.29%
  PLXF	Dec P25/22.5	0.50	InitCrdt =	$186	Margin =	$1,000	%Ret =	18.58%
  TOT =				$1,137		$5,000		22.75%

	Best on %Ret JAN
AAPL	Jan P180/175	2.10	InitCrdt =	$826	Margin =	$2,000	%Ret =
WPZ	Jan P40/35	0.45	InitCrdt =	$166	Margin =	$2,000	%Ret =
PLXF	Jan P25/22.5	0.55	InitCrdt =	$206	Margin =	$1,000	%Ret =
RDY	Jan P15/12.5	0.45	InitCrdt =	$166	Margin =	$1,000	%Ret =	16.58%
TOT =				$1,363		$6,000		22.72%

Please note the leverage for your capital. For a Margin of $6000 in your Options Trading account you would receive an Initial Credit of $1,363 or a return on margin of 22.72% for one month which is an annual return of 272%. Remember there is risk in trading options, and options trading is not for everyone!

Note: to implement any of these credit spreads, Use my Options Trading Software: SelfAdapDTN4 Cost $70 using DTN.IQ realtime data which is about $40/Mo. My User's manual explains how to subscribe to the DTN.IQ data service. Order by sending email to Jon Schiller, PhD email: jonsch1@verizon.net

Pay by check to:

Emilie Smyth

700 E. Pine Ave #118

Lompoc, CA 93436

YouTube Website

http://www.youtube.com/confirm_email?cid=E97BF3C59BD84616&nid=m42c2AM2tzQsfb2bZuIdzBhd4vRm7yjBVJC7Zo-40hw=&next=/index

Options Trading Software: SelfAdapDTN4

Market Blogs – Jon Schiller, PhD: Options Trader

Th 29 Nov 07

Make your Capital Grow Rapidly using my Software Package: SelfAdapDTN4 for easy and potentially profitable options trading.

A volatile Stock Market makes opportunities for Profitable Option Credit Spreads. See the extraordinary moves this week:

Date

OEX.XO

Up

Down

· OEX Call 2 sigma Spread C705/710 still safe

· Two sided SPY 2 sigma Spread C152/155 P139/136 safe

· Two sided QQQQ 2 sigma Spread C52/56 P48/46 safe

· BIDU Put 2 sigma Spread P270/260 still safe

Considering following 2 sigma spreads for remaining 3 weeks of option month

1. AAPL Sprd: 4 C190/195 at 1.85 InitCrdt =$726 Mrgn = $2000

2. RIO Sprd: 4 P30/27.5 at 0.3 InitCrdt =$134 Mrgn = $1000

3. GOOG Sprd: 2 C730/740 at 2.6 InitCrdt =$134 Mrgn = $2000

4. LFC Sprd: 4 P75/70 at 1.1 InitCrdt =$445 Mrgn = $2000

5. DRYS Sprd: 4 P70/65 at 1 InitCrdt =$386 Mrgn = $2000

My Software Package: SelfAdapDTN4 keeps all of these Spreads Updated during the option month using realtime data from DTN.IQ service which is about $40/Mo

Taiwan Fighter, Story about development of Fighter Aircraft

Novel: Taiwan Fighter, Story about the development of a Fighter Aircraft

Author: Jon Schiller, PhD

The leaders of the Republic of China (Taiwan) devise a strategy to regain Mainland China (Peoples’ Republic of China) from their communist enemies. This plan requires the development of a super-advanced fighter aircraft which will be used to destroy the Chinese leadership during a military parade when they will all be sitting in the same reviewing stand. After an unsuccessful attempt to obtain assistance from the US to develop this fighter aircraft, the Taiwan intelligence agency sends an agent, Eddie Chung, to the US to recruit the aid of an American aircraft designer, Randy McLyle, and his beautiful associate, Patricia Manos. These two talented engineers decide to immigrate to Taiwan when offered ten million dollars for their super advanced design which had just been rejected by the US Air Force as being too far out.

The preliminary design of the aircraft is completed in Taiwan, but then it becomes apparent that Taiwan does not have certain technologies which will be needed for the final airplane. McLyle recommends Taiwan seek help from Israel. McLyle and Chung visit Israel to negotiate an agreement with the Israelis to help construct the aircraft and its weapons. The agreement includes a payment of almost a billion dollars to the Israelis for their special technology.

Jon Schiller received the BS from Caltech and the doctorate from the University of Southern California, He was an executive in the aerospace industry and served as a consultant for the design of avionics systems for advanced aircraft and space vehicles.

The author spent considerable time in the Republic of China (Taiwan) over a period of two years. He visited some of the aeronautical, science and technology institutes in that country. As a result of his discussions with Chinese scientists and military officers, he gained a knowledge of their aims relative to Mainland China and of their aircraft technology.

This background in Taiwan permitted the author to develop this fiction story (based upon the Nationalist Chinese hopes, aspirations, and technological capability) about an ultra high performance fighter aircraft developed by the Taiwanese with the help of an American designer and the Israelis.

Multihulls, About a around the world Catamaran Race

Book: MULTIHULLS, copyright Ó 2000 Author: Jon Schiller

Type: Novel: Adventure 211 pages

A select group of world-class yachtsmen prepares for the Round-the-World Multihull Race, a test to determine not only the best go-fast design but also who is the world's greatest skipper.

The challengers have known each other through years of Grand Prix and Olympic sailing competitions. Ronny Kelly, amiable and clever Californian, Paoli Venuzzi, who secretly cheated Kelly out of the gold at the Barcelona Olympics, and Philippe Matin of France emerge as the top contenders.

Their efforts are bankrolled by international corporations which hope to capitalize on the favorable publicity attached to the winning team. Kelly is backed by Crédit Juillarde, a French banking empire whose young chairperson, Regina Juillarde, seeks to advertise her bank's innovative bank-by-personal-computer system for international financial transactions. Banco di Napoli, a Mafia front based in the Cayman Islands, backs Venuzzi. The Mafia is not content with just favorable publicity for their bank; they scheme to collect millions in gambling and drug peddling profits plus break into and transfer (steal) millions more from the Crédit Juillarde system. They pressure Venuzzi to smuggle cocaine and arrange for accidents during the race, but he draws the line at hurting anyone.

Secretly, Venuzzi bribes confederates among the other crews to sabotage his rivals. As the race proceeds Kelly discovers Venuzzi's rôle and forces him to call off his dirty tricks team. On the final leg, desperate to recoup their gambling losses on the race by making Venuzzi win, the Mafia hides bombs on his two closest competitors' boats, but Kelly's vigilance saves him from the bombing attempts. Matin is not as lucky; his boat is blown up off the South American coast.

The contest is battled closely to the finish in Southampton, England. Dueling from far out at sea, Kelly and Venuzzi tear towards the line, Kelly managing a 20-second victory. The Mafia executes Venuzzi for losing.

AUTHOR: JON SCHILLER

Jon Schiller's books, The Insider's Automatic Option Strategy ISBN 0-930233-49-2 was published in early 1992 and The 100% Return Options Trading Strategy was published in May 1998 both by Windsor Books,. Another book on option trading, Profit in Index Option Trading Using Decision Charts was published in early 1993 by Emilie Books. He designed computer software systems for options trading, after receiving the BS from Caltech and the doctorate from the University of Southern California. He skippered three Transpacific Yacht Races, trophying twice. His hobbies of yacht racing and world-wide traveling provided the depth of experience to create this story. In Europe during the last several years, the author witnessed a great many multihull regattas of the high technology 40 and 80 foot boats described in the book including the finish of the single handed around the world multihull race in April 1987 and the Olympic regatta in Barcelona in 1992. He has met many of the top racing skippers and multihull designers (none of them were involved in the skullduggery of the fictitious Venuzzi).

Novel: Lost in Space, About the Space Shuttle

Novel: Lost in Space, A Story about the Space Shuttle

Author: Jon Schiller, PhD

The US Space Shuttle delivering supplies to the US Space Station has a mechanical breakdown that prevents its return to the Earth. The remaining two US Space Shuttles are launched as quickly as possible to carry the needed supplies to the Space Station before the people there run out of expendables: air, water, etc. Both aging Shuttles suffer breakdowns – one explodes on the launch pad and the other has a breakdown in orbit near the Space Station. This second Shuttle is close enough to the Space Station to be secured by a cable and then winched up to the Space Station docking gate.

The hero, Dr. Donald Richards, devises two options for rescuing the stranded astronauts: use the new European Space Station Shuttle or use the Soviet Space Shuttle. The US President over-rules NASA’s recommendation to use the Soviet Space Shuttle for the rescue, so Richards negotiates an agreement with the European Space Agency to use their Shuttle to rescue the astronauts.

More About the Author

Jon Schiller received the BS in Physics from The California Institute of Technology (Caltech) and the PhD in EE & Math from the University of Southern California. He worked for major aerospace companies and received Group Achievement Award to the Special Staff to the Chief Engineer to Access the Shuttle Flight Certification for flight readiness before the first Space Shuttle flight from NASA. As a result of his NASA service he was invited to attend the launch of the first flight of Colombia in April 1981.

IBEX - Novel about Elint System

Novel: IBEX, A story about an Electronic Ground Based Spy System

Author: Jon Schiller, PhD

The IBEX project was a direct result of the perceived need of one nation to clandestinely collect information about other nations for reasons of national security. The two superpowers, the United States and the Soviet Union (when it existed) each spent billions of dollars each year spying on each other. The news media was filled with stories about spies on one side or the other defecting, or spies being prosecuted, convicted, and sent to prison. These stories in the news media usually deal with the human side of intelligence gathering, referred to as HUMINT by the intelligence communities (CIA of the US, SAVAK of Iran, of the old Soviet KGB, and MOSSAD of Israel.) IBEX represent a much larger enterprise than just HUMINT. This is electronic intelligence gathering, referred to as ELINT.

IBEX is a fictional story of the people involved in developing, installing, and using an ELINT system during the Shah's reign in Iran. Although the actual titles of world leaders are used, the words and actions of these leaders are purely fictional. The story of IBEX portrays what impact electronic spying can have on world events and how world leaders might react to information so collected.

Masada Never Again

Masada Never Again About How Israel Acquired the A-Bomb

Jon Schiller, PhD , Author

Dani Sharon an Israeli business entrepreneur is recruited by his government's clandestine LEKEM to mastermind acquiring the components and technology to build a nuclear arsenal. Dani's flamboyant character and tactical brilliance make him a natural for the assignment. His only stipulation in accepting the task is that he be allowed to skim a profit off all his transactions to finance his movie ventures.

Dani obtains the necessary material and information through extralegal and clandestine methods. He cuts numerous deals with European, South African, and American companies. What he can't buy, he steals in daring capers monitored by the superpowers. Within a short time Israel explodes its first atom bomb. However, soon after this success, Israeli leaders realize radioactive fallout would endanger their own population if the atom bomb were used against hostile Arab neighbors. They conclude a neutron bomb is necessary to protect the Israelis from this danger. Using a movie production company as a cover, Dani begins acquiring the technology for such a bomb and the ballistic missile to deliver it.

Irrational Indictment & Imprisonment of Loyal Avionics Engineer

Irrational Indictment & Imprisonment

of a Loyal Avionics Engineer who

Used Commerce Instead of State Department Export Regulations

Indictment, Exile, Deportation, Plea Bargain, Imprisonment, Release on Probation, Freedom at Last

SUMMARY

Dr. Ernest Kelly was a well respected Avionics engineer who had worked for the Autonetics division of Rockwell International, a large US Aerospace company in California for over two decades until he formed his own small Aerospace Avionics consulting company called Milco International, Inc. Just before leaving the large Aerospace Company he had the assignment of finding business in the Middle East in Iran and Israel. During this time he met Dani Roto, a wealthy, politically well connected Israeli businessman who owned Heli Trading Company (HTC) in Tel Aviv. One day the Vice President to whom Ernest reported , offered him the Israeli business with Dani if Ernest would form his own company. The reason for this offer was that the Saudis were threatening to cancel Rockwell’s much larger contracts with them if Rockwell continued to do business with Israel.

Most of the items Dani ordered from Ernest’s company were considered Munitions Components and required a State Department Munitions Control Export License. In 1975 Dani ordered some electronic tubes called Krytrons, but before any tubes were delivered he suddenly canceled the order. The business between Dani’s and Ernest’s companies continued with the arrangement that Dani would receive 60% of the profit for each order in his Zurich numbered bank account and Ernest’s company would retain 40% of the profit for his firm. Dani and Ernest became good friends over the years with Dani visiting Ernest’s waterfront home in Huntington Harbour, California and Ernest attending Dani’s son’s Bar Mitzvah in Israel.

Ernest was delighted to start his own business which he named Milco International, Inc. After a short time Ernest was able to have Milco obtain Avionics consulting contracts with the USAF, NASA, US Aerospace Prime Contractors, and friendly foreign countries such as Taiwan.

In 1979, Dani ordered Krytrons again, saying they could be shipped under a Commerce Department export license. In 1982, shortly after the last of this new order of Krytrons was shipped, Ernest’s company Milco was burglarized. The burglar stole all of the company computers. Shortly after the burglary Dani had called Ernest and wanted to order more Krytons and was quite insistent that a Commerce License be used. Ernest explained that could not be done since the last invoice from the Krytron vendor had said a Munitions License was required. As a result of the burglary, Ernest was required to write a report to the FBI suggesting who might have done it, because of the secret contracts Milco held with the US military. Because Dani had been so insistent, Ernest mentioned in the FBI report that he had shipped Krytrons using a Commerce Department license.

Ernest would have forgotten about the FBI report and the Dani conversation except that three years later he received notice to appear in downtown Los Angeles to be interviewed by a Federal Prosecutor. He couldn’t understand what such a meeting could be about. He soon found out. The prosecutor said Ernest would be Indicted for illegally shipping Krytrons to Israel. Ernest was shocked. He believed that he had always been open with the US Government and had helped the USG in every way he knew how. He soon learned that in the US when Indicted of a Federal Crime, you are considered guilty. He had always believed one is innocent until proven guilty, but he quickly learned that was an old fashioned idea no longer true in the 20^th century when eager Federal Prosecutors bring all of the resources of the USG against those indicted to put them in Prison. Brian, a former attorney for Rockwell and a retired judge who was on Milco’s board of directors, warned Ernest: you will meet a part of the USG you didn’t know existed before – people that want to throw you into prison! Unfortunately Ernest did learn how US & Spanish Prisons work – from the inside!

Jon Schiller PhD, Author of Options Trading Books & Novels:

Insider’s Automatic Options Strategy

The 100% Return Options Trading Strategy

Published by Windsor Books, Brightwaters, New York

Self Adaptive Options & Currency Trading

Multihulls – A Round The World Catamaran Race

Masada Never Again – The Israeli Quest for the A-bomb

Published by Windsor Books, Brightwaters, New York

Self Adaptive Options & Currency Trading

This book is unique in that I, Jon Schiller, have direct access to Ernest Kelly who has just recently finished his prison sentence and probation and can freely communicate his experience with the global public.

Profits Using Decision Charts

PROFIT IN INDEX OPTION & CURRENCY TRADING USING DECISION CHARTS

Aggressive Options & Currency Trading Strategies by

JON SCHILLER, PhD

This up-to-date book explains in easy to understand terms how sophisticated traders can make money each month (with small risk) and make capital grow by trading in the Index Options Markets.

The book recommends the S&P 100 Index Option (OEX) as the best Index Option for trading for reasons given in the book.

The book is broken into four parts, with a total^-of 12 chapters and two appendices. Part 1 describes the fundamental strategies for capital growth using index option trading and presents several examples of option trading strategies and the algorithms for two basic market indicators. Part 2 describes the spread sheet and chart tools for profitable index option trading and tells what to do when the market undergoes large rises or drops. Part 3 describes the decision charts and six market indicators to help you tell which direction the market is moving and details strategies using out-month options. Part 4 describes a WINDOWS, Excel Software for an IBM compatible Personal Computer available email attachment. These programs and EXCEL spread sheets perform all the tasks needed for profitable index option trading.

Jon Schiller is a computer scientist with a BS from Caltech and a Ph.D. from the University of Southern California where he served for several years as an Adjunct Professor directing research in personal computer software and hardware. The author has more than 25 years experience in options trading. He managed a small company pension fund for almost 10 years. He has developed software, spread sheet, and decision chart tools to facilitate option trading using low risk strategies with high return on investment collateral. The index option strategies he uses have survived the huge rises and drops in the market (including the October 1987 crash) as well as the normal up and down movements of the market.

US$90

SelfAdapDTN4

Here is a sheet from my New Options Trading Software: SelfAdapDTN4

SelfAdapDTN4 Trading Center
SPX	1,426.00	Expiration	16-Nov-07	ATM Longs	Prm Got	Prm Now
OEX	667.35	NOPS =	1	C675	15.00	13.50
OEX Del	9.56	Comm =	$10.30	P675	20.50	21.90
SEP 2SIG COVERED SPREADS			Today =	27-Nov-07	35.50	$3,571
OEX DTN Options			TK Cap =	$18,214	Mgn%Cap =
667.35	9.56	2Sig	33.71		After OEX Trade
NOPS =	4	Dec NOPS =	4	OEX/SPX	SPX Del	%Ret/Mn
2SigCall	700	2SigPut	635	0.47	18.78
C690/695	1.80	2.70	$734	$342	Bid =	1.60
P690/685	2.90	3.00	$1,174	$22	Bid =	3.30
OEX Crdt Spreads		Total =	$1,908	$364	$4,000	47.71%
C705/710	1.30	0.30	$506	$382	$2,000	25.29%
P640/635	1.00	1.10	$386	-$58	$2,000	19.29%
SPY DTN Options
141.94	0.99	2Sig =	6.53
NOPS =	6	Sprd Comm =	16.80
C152/155	0.79	0.34	$457	$162	$2,000	22.86%
P139/136	0.57	0.89	$325	-$146	$2,000	16.26%
2SigCall	148	2SigPut	135
QQQQ DTN Options
49.92	0.94	2Sig =	2.39
NOPS =	5	Sprd Comm =	15.50
C52/56	0.76	0.75	$365	-$10	$2,000	18.23%
P48/46	0.48	0.49	$225	-$18	$2,000	11.23%
2SigCall	52	2SigPut	48
BIDU DTN Options
339.26	13.12	2Sig =	51.17	Prob Safe	67.54%
NOPS =	2	2				%Safe =
P270/260	1.90	1.80	$368	$8	$2,000	18.42%
2SigCall	390	2SigPut	290

Another New Options Trading Book: Contents

TABLE OF CONTENTS

TABLE OF CONTENTS i

FORWARD vi

Chapter 1 Options Fundamentals: INDEX OPTIONS

FUTURE OPTIONS, TECH STOCKS & OPTIONS, & CURRENCIES 1

UNDERLYING MARKETS 2

A QUICK OVERVIEW OF THE STRATEGIES: 2

INDEX OPTIONS 3

STOCK OPTIONS 4

NEURAL NETWORK INDICATOR 4

FUTURES OPTIONS 5

CURRENCIES FOR TRADING 5

HOW DOES THE WWI TRIGGER WORK? 6

OPTIONS VOCABULARY 6

MARGINS FOR OPTIONS TRADING 10

OPTION CODES 10

CURRENCY VOCABULARY 12

SOME EXAMPLE CURRENCY COMPUTATIONS ARE: 12

OBJECTIVE OF OPTIONS AND CURRENCY TRADING 14

CAPITAL GROWTH MODELS 14

SUMMARY 15

CHAPTER 2 OVERALL STRATEGIES FOR OPTIONS TRADING using Realtime Tools

OPTIONS, CURRENCIES & STOCKS 19

WHEN DO YOU OPEN THESE POSITIONS? 19

WHEN DO YOU CLOSE THESE POSITIONS? 19

THE NAKED SPREAD STRATEGY 20

EXAMPLES OF NAKED CREDIT SPREADS 21

THE COVERED SPREAD STRATEGY 22

EXAMPLE OF A 2 SIDED COVERED CREDIT SPREAD 23

THE DEBIT SPREAD or LONG STRATEGY 24

CURRENCY TRADING 25

STOCK TRADING 25

SUMMARY 25

CHAPTER 3 Executing 2 Sigma Credit Covered Spreads 27

EXPONENTIAL MOVING AVERAGE ALGORITHMS 27

WELLS-WILDER INDICATOR (WWI) 28

EQUATION FOR 2 SIGMA 28

WWI COMPUTATIONS FOR OEX 29

OTHER MARKET SIGNAL INDICATORS 29

FOUR DAY MOVING AVERAGE DIFFERENCE = MAD4 30

DIFFERENCE BETWEEN 9 DA & 4 DA MOVING AVERAGES=MAD9-4 30

THE MOVING AVERAGE DIFFERENCE COMPARISON = MADC 30

THE STOCHASTICS %D-%K MARKET SIGNAL INDICATOR 31

COMPLEX MARKET SIGNAL INDICATORS 31

SUMMARY 32

CHAPTER 4 Filter Buy Stocks for Hsu & Zack Recommendations 33

USE OF THE CBOE Option Chains to find Put Covered Spreads 33

Evaluate Long Calls with adequate volume using CBOE 35

Use Trade King Tools: Spread Probability of being Safe 36

Paper Trades for Put Credit Spreads using CBOE data in Schiller Software 38

My Yahoo Real Time Charts for Stocks being evaluated 39

Paper Trades for Long Calls using CBOE data in Schiller Software 40

SUMMARY 41

CHAPTER 5 Using SelfAdapDTN4 software by Jon Schiller 43

How and where to Paste & Evaluate CBOE options Chains for Indices & Stocks 44

SelfAdapSpreads Sheet for setting up Paper trades for spreads being considered 45

SelfAdapSpreads Sheet for Long Calls & Straddles being considered 45

How to Enter DTN.IQ watchlist in SelfAdapDTN4 software 46

Surveillance of Open Positions during Trading Day using Realtime quotes 46

End of Day Update for next Trading Day 47

Update at Options Expiration 3^rd Friday of Each Month 48

Getting Ready for Next Option Month on the Sunday or Monday after Expiration 48

Getting Ready for Next Option Trading Day: Detail new positions being considered 56

SUMMARY 56

CHAPTER 6 Opening New Positions using TradeKing Interactive Website 57

How to Open Call & Put Credit Covered Spread 58

How to Open Long Calls or Puts 59

How to Open Debit Straddles or Debit Strangles 61

How to Evaluate the Probability of a Spread ending Safe using Tools 61

How to Evaluate Open Positions using Summary 62

How to Modify or Cancel an Open Order 63

How to Print Orders Executed 63

SUMMARY 69

CHAPTER 7 Setting-up Watch List using DTN.IQ & Using Features 71

Establishing First Watch List with all Indices, Stocks, and Options 71

Modifying Watch List for New Stocks and Options being Considered

Sample Watch List for getting Started 75

Setting Up Realtime Charts and How to Use

Setting Up Realtime Option Chains and How to Use 78

SUMMARY 79

CHAPTER 8 Using Underlying Stock as Margin for Stock Credit Spreads 81

Benefits of Buying Stock for Hsu & Zack Buy Stocks 81 Buying & Holding Stocks As Long Term Equity Investment 82

Amount of Stock Value applicable to Credit Spread Margin 83

SUMMARY 83

CHAPTER 9 Survey Of Market Signal Indicators 85

DESCRIPTION OF EACH MARKET SIGNAL INDICATOR: 85

Moving Average Difference Market Indicators 86

The 4 Day Moving Average Difference = Mad4 86

Difference Between 9 Day & 4 Day Moving Averages = Mad9-4 86

Moving Average Difference Comparison = MADC 86

Stochastics %D-%K (SPECIAL MOVG AVG INDIC) DIFFERENCE 87

Bollinger Band Indicator 88

Wells-Wilder Indicator (WWI) Market Indicator 89

Chinese Candlestick Charts 89

Neural Networks a new Concept for Predicting Market Movements 89

SUMMARY OF MARKET SIGNAL INDICATORS SURVEY 90

CHAPTER 10 SOME TIPS TO ENHANCE TRADING PROFITS 91

USE VOLATILITY to INCREASE COV CREDIT SPREAD PREMIUMS 91

WHEN TO OPEN THE TRIGGERED DEBIT SPREAD 92

CORRECTIVE ACTION FOR 2 SIGMA COVERED CREDIT SPREADS 93

WHAT TO DO WHEN A SHORT PUT or CALL IS THREATENED? 94

CORRECTIVE ACTION for CR SPREADS IF WWI IS BETWEEN 80 & 20 94

SUMMARY 95

CHAPTER 11 GLOBAL GROWTH MODEL 97

OEX and STOCK OPTIONS 4 YEAR GROWTH MODEL 97

COMMODITY FUTURE OPTIONS GROWTH MODELS 98

CURRENCY GROWTH MODELS 98

GLOBAL CAPITAL GROWTH MODEL 98

SUMMARY 99

CHAPTER 12 SELF ADAPTIVE TRADING SOFTWARE 101

SELF ADAPTIVE INDEX & STOCK OPTIONS SOFTWARE: SelfAdapStkOpDTN4 101

COMMON FORMAT FOR THE 11 EXCEL SPREAD SHEETS 103

Capital Growth Model Spread sheet 105

CAPITAL GROWTH CHART: OEX & sTOCK OPTIONS $ PROFIT 106

HOW TO USE THE COMMON FORMAT SPREAD SHEETS 106

TARGETS OF OPPORTUNITY: WWI > 80 or WWI<20 107

SUMMARY of SelfAdapStkOp Software 108

FUTURE OPTIONS SOFTWARE: SelAdaptFutOp.xls 108

COMMON FORMAT FOR THE 11 EXCEL SPREAD SHEETS 109

HOW TO USE THE COMMON FORMAT SPREAD SHEETS 111

TARGETS OF OPPORTUNITY: WWI > 80 or WWI<20 112

TRADING RESULTS FOR 10 FUTURE OPTIONS – WWI TRIGGERED 112

SUMMARY of SelAdaptFutOp.xls 113

SELF ADAPTIVE CURRENCY TRADING SOFTWARE: SelfAdapCur.xls 113

COMMON FORMAT FOR THE 4 CURRENCY EXCEL SPREAD SHEETS 114

HOW TO USE THE COMMON FORMAT SPREAD SHEETS 115

TARGETS OF OPPORTUNITY: WWI > 80 or WWI<20 115

SUMMARY of SelfAdapCur.xls Software 116

SELF ADAPTIVE STOCK TRADING SOFTWARE: SelfAdapStockTrading 116

COMMON FORMAT FOR THE EXCEL STOCK SPREAD SHEETS 117

RESULTS of STOCK STRATEGY 1: WWI TRIGGERED BUYING / SELLING 118

RESULTS of STOCK STRATEGY 2: BUY 200 SHARES & HOLD FOR 1 YR. 118

HOW DO THE TWO STRATEGIES COMPARE SIDE BY SIDE? 119

HOW TO USE THE COMMON FORMAT SPREAD SHEETS 119

HOW TO START WITH STRATEGY 2 – THE MOST PROFITABLE WAY 119

TARGETS OF OPPORTUNITY FOR STRATEGY 1: WWI > 80 or WWI<20 119

SUMMARY 120

APPENDICES 121

APPENDIX A. WEBSITES TO AID OPTIONS & CURRENCY TRADING 121

APPENDIX B. SOME WEBSITE BROKERS 123

APPENDIX C. ANSWERS TO TEST QUESTIONS 123

APPENDIX D. COMPARISON OF MARKET INDICATORS AS TRIGGERS 124

WWI vs STOCHASTICS %K-%D

WWI vs MAD9-4

WWI vs MAD4

WWI vs MADC

WWI vs BOLLINGER BAND

SUMMARY OF MARKET INDICATORS

APPENDIX E. DAILY & MONTHLY TASKS 125

UPDATE MARKET VALUES IN SPREADS SHEETS DAILY

SCAN SPREAD SHEETS DAILY FOR WWI TRIGGERS

OPEN NEW COVERED CREDIT SPREADS MONTHLY

APPENDIX F. CAPITAL SHIFTS THEORY for BIG MARKET MOVEMENTS 126