One of the newsletters I get from options people had a survey -so I thought it'd be fun to do. I was shocked when they said that 73% of their traders had lost money -some big, in the last year. I was also at variance with them about picking the underlying-seeing as I mostly trade the index that is not surprising. I spotted Yell as a massive short about a year ago- it went from 200 to about 17. Now a far dated put or even put spread would have been a monster trade-at least 10 to 1.
I forgot to do the trade!
One I have seen currently is Carpetright- which appears to be optionable. It kept going up recently, hitting a fiver-totally against all logic. No-one is buying carpet, let's be serious for a second. Houses are not selling, money is tight, so only the uncreditworthy would be suckered into some suspect 'buy now pay in 2 years' deal. I would expect to see CPR. on the floor in the next 6 months, but don't like option prices -any input gratefully rec'd. I will review this-but do not like to have short options on mad things like equities that defy the rules of the universe.
Link: http://uk.finance.yahoo.com/q/ta?s=CPR.L&t=6m&l=on&z=l&q=c&p=e20&a=w14,m26-12-9&c=
I'd like to see it back up at the 20 before going short via a put position. Happy trading.
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