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How many people going to those clinics are illegal immigrants? Not all of them are, of course, but I'll bet a lot of them are.

Even if you're just a directional trader you need to keep volatility (and thus vega) in mind. Suppose an equity has just got whacked down hard on some bad news. You decide this was an overreaction and expect it to pop back up at least half way to where it used to be. So you buy a call. Oops...

Now I don't fell quite so stupid when I lose a few hundred dollars on a bad option play.

Agreed.

It sounds like you are assuming the back tester will be stupid enough to use the same time periods for the learning phase that he uses for the testing phase. Assuming that the back tester has at least the brains of an oyster, he will not do this, but will instead use different time periods for...

Wow indeed. From that document: "While the rules of the Snider Method prohibit selling stocks at a loss, this does not limit or prevent the accumulation of unrealized losses. Nor does it guarantee that a position will eventually close or that unrealized losses won’t persist indefinitely...

The price and yield are directly connected. How much price appreciation can you really expect on a 1% bond? If its a 5 year bond at 1% and then interest rates go to 0 you'll get about a 5% appreciation in the value of the bond. That's your maximum upside. If people get sane and realize that...

It's easy to find, after the fact, short duration options that have doubled, tripled, quadrupled, quintupled, or sextupled in value in a day or two. So what? It's also easy to find, after the fact, people who made a million times gain by buying a lottery ticket.

If you bought the stock and sold the ITM covered call then of course your stock will be called away and you won't be short any stock. But your stock is sold for less than you paid for it, so net you will make the time value of the call -- which is the same as the time value of the put at the...

What do you mean by "use options as a stop loss"?

One of those houses is across the street from me. It was foreclosed two years ago and has been empty ever since. Naturally that's doing wonders for the resale value of *my* house.

So you're saying that at expiration the call is 2.50 in the money. Just before expiration you could buy back the call for a bit over 2.50, making close to 270 net. If instead you actually let the call expire ITM it will automatically be exercised and you will be short 100 shares of the stock...

Any time I can get 26% in a day I'm happy to take the profits and run. Of course I can't trade at anywhere near the size of the trades that get featured here. (I don't think livevol will ever have a post that begins "10 put spreads were sold on XOM today...".)

Thanks for clearing that up.

It's really hard to accept trading advice from a guy whose screen name is deadbroke.

I'm confused. If you're only buying calls and not hedging with stock how can you be delta neutral?

Actually, if you want people to ride bikes you should have paved roads. Gravel is an excellent way of making bikes lose traction and fall over.

What does this have to do with options?

Sharron Angle isn't my ideal candidate but I'll take her over Harry Reid any day of the week. In politics the choices aren't between good and bad, they're between bad and horrible.

You have discovered that markets are efficient. If any publicized indicator or chart pattern worked consistently everybody would be using it and that would change the market in such a way that the method would no longer work. That is why real traders never reveal the trading criteria they use...