Recent content by dummy-variable

since i trade front month options mostly, yes these have little time to expiration. as butterflies i benefit from time decay. by having extra units on the wings i have gamma only if there is a big move outside the wings. i don't look at these trades as +gamma so much as simply fixed risk trades...

i trade 98% options on stocks. 2% index options. i trade 90% front month options. if there is any running theme to my trading it is "buy the wings and sell the meat." by that i mean that i mostly trade positions that look like butterflies with curvature at the wings (extra wing units which...

shows you how long its been since i was on the floor. man that rule used to stick me all the time. i just scoped around the cboe site and it looks like they eliminated even the raes minimums on everything but the indexes. oh well thanks for correcting me.

another thing to note is that wherever your order is routed, if it is an exchange, the market makers will be obligated to meet a fill at that price for a minimum number of contracts. so if you specify say the CBOE and place an offer to sell one contract at 5.90. then an order to buy comes in for...

ah i see what i did. i plugged in a value for expected return (of +8.5% or the approximate long term return on the index). that does skew the result. thanks for pointing this out.

you're basically wrong on this assumption. also i was using implied not historic vol. it's pretty conclusively demonstrated that implied volatility is the best estimate of future actual volatility. sure, you can always point to exceptions but if you trade long enough you find this to be true...

it's been a while since i took a stats class but i'm pretty sure i'm correct on this. in fact i just rechecked with the hoadley function for probability the index would be down below 101 at expiration and it generated 0.91% this is true but there are other variables such as changes in IV to...

way too many other preoccupations

usually it's because the MM can take off risk on a position with the trade. or it might simply be a scalp on a previous trade. sometimes it's also a way to clear out a small order that get's in the way of a bigger spread trade being quoted. not necessarily true. that's the whole problem -...

you can follow any of my comments on this board by just clicking on my post history. the point of view that most matches mine on these boards seems to be maverick and riskarb. i've posted trades in other places mostly to illustrate some techniques such as butterfly management (see...

what i meant by my comment that gamblers are good for my trading is that in general if someone does not know how options operate they are creating opportunity for those that do know. i'm in the business as a pro (read my earlier comments - i was a market maker on the cboe) and have never...

you're kidding right? what options pro would ever look at "buy/sell" ratios (whatever that is)? even if anyone ever did look at trade volume for some reason, if you had checked PEET options, multi was pretty much the whole party on the days he traded. how would you read those tea leaves...

anyone can come up with examples of how astronomical returns COULD be made. e.g. i could show how if you pick the lottery numbers correctly you could turn $1 into $50MM in just one day. the point is that to consistently find options that double in a week and then pyramid this success X times...

that particular quote was half hyperbole, half supposition based on experience. i don't have any hard data but years of personal experience and talking with a lot of traders and brokers pretty much confirms that most options traders - whether winners or losers - are generally right about 50% of...

not sure you are asking this the right way. basically if you are a winning trader you are more prudent thinking it's ALL due to luck until you can prove you've traded successfully, consistently (e.g. profitable month after month for multiple years) over many trades (say > 1,000) in many...