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Please help me to understand your statement: "the first $100K of everything else will be tax-free." Does it mean that if you have a trading account of $1,000,000, and you buy stocks worth only $100K, then you will not be taxed? Or will you be taxed because your trading account exceeds $100K...

Yes, tax on the capital involved in the trade is what I meant (see original post). But still, if you have a total capital of $100 for trading, and each trade is $10, you do 10 trades a day, then you effectively will be taxed 0.5% per day on your entire capital of $100. If you don't make an...

Done !! Thanks for the link!

Let me correct my own math a bit: Suppose each trade you don't make or lose anyting on the trade itself; after one round turn trade, you are down to (1-0.005)=0.995 of your principal due to tax; after two round turn trade, your are down to 0.995^2; and after n trades, you are down to 0.995^n...

http://www.nytimes.com/2009/01/13/opinion/13herbert.html?_r=3 http://www.elitetrader.com/vb/showthread.php?threadid=150546 The way I understand this tax is that a o.25% tax will be levied on the value of a transaction; e.g., on $10000 if the stock or option is valued at $10 and the...

The way I understand this tax is that a o.25% tax will be levied on the value of a transaction; e.g., on $10000 if the stock or option is valued at $10 and the transaction amount is 1000 shares or 10 option contracts. This is unsustainable and the tax bill will be self-destructive if you do...

Hello: I have been using the Scheme and C++ algorithms from Espen Haug's website: http://www.espenhaug.com/black_scholes.html They work okay under most circumstances, but when I try to simulate option values under hyperinflation with interest rates greater than 50%, the put values given...

Thank you all for your replies! With the Fed creating trillions of dollars out of thin air, and with so many warnings in the media and YouTube, I am genuinely concerned about hyperinflation because of the following additional factors: (1) I am paid by the government, and my paycheck is...

Hi all: With the Fed creating trillions of dollars out of thin air, and with so many warnings in the media and YouTube, I am genuinely concerned about hyperinflation because of the following additional factors: (1) I am paid by the government, and my paycheck is deposited electronically...

Thank you for all your replies. I have used some online options pricing calculators to calculate the call prices in case of hyperinflation while holding all other variables constant. The call prices blow through the roof. Therefore, I think that in case of hyperinflation, short calls are deadly...

Hi all: I am wondering whether hyperinflation and devaluation of the currency will cause abrupt rise in all asset prices and thus cause massive losses on short calls. This can happen if China/OPEC countries, for instance, suddenly stop buying our bonds. As I know, inflation usually causes...

I am trying to hedge in case of war, market crash, inflation, deflation, and depression. What do you think will preserve value or even increase in value in those scenarios? Defense sector tends to go up in war times (like WWIII); commodities go up during inflation; but pretty much everything...

I think it is quite comical :)

Healthy skepticism is always welcome. I didn't believe it myself at first, but after so many trials, I am convinced. But please note that it is a "qualified" random walk, and it works only under some "acceptable constraints." It is still quite possible that I lose big. Fortunately, in events...

Hi all: I have devised and tested a strategy using the standard Black-Scholes and a qualified random walk model, and I have found a strongly positive expectancy in this strategy. I have also tested it in real life with indices such as DJX, and results were as I had expected. My...

Everyone wants to have plenty of money, free time to do everything, and easy way to make a lot of money. If you do not have extensive experience in options, giving up your job to espouse something alien is not a good idea. No to discourage you, but to remind you not to be intoxicated by the...

Trend following, I believe, is much based on technical analysis, which is a discipline I have mostly abandoned through my own experience. (...

A qualification on my original post: not capturing every move of the market, but every MAJOR move of the market, such as any significant retracements.

Setting all these differential equations and models and theories aside, all it comes down to is designing positions to make profit. I have perused various threads on this forum; most recently, the DITM (guts) thread. I have long been wondering: Is it possible to capture every market move with...

Thank you all for your replies. Let me try to re-state what I am trying to achieve. Assume there is a set of options which I will denote "S." I am trying to construct S with the following characteristics: (1) when the underlying moves in one direction (e.g., up), no matter how far, S loses...