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If you have not realized it yet, trading has a lot of common with gladiating (in case the verb does not exist, let us coin it on ET and spread it to the world "from this place and time" as JFK said once). Wall street is ancient rome, and you the trader is a gladiator. You have cuts to prove it...

You may not understand the fundamental reason of why one spreads. Also you may not understand butterflies and when to use them. OTM are specs and in case of earning vol is high on both sides up and low. SP is slow particularly on the upside. Plus calls vol is lower on the upper side than the...

Such knowledge is not free, particularly for people like you. Plus the kid, unlike you, has a head and a correct attitude. He wants to understand and earn his money (not tend the hand). He will go far.

You are right in your quote-- not just in one book but in plenty (of course not all books make that "mistake"). In addition, there might be a sentence there that would put the author off the hook, but the job of the book is not to hedge itself but to make sure that it loads your mind with the...

Computers do the calculations, they do not do the thinking--humans do! The problem is in the formula used and its implications, not in the labor to run numbers. It is true that running numbers is a job done well and accurately by computers.

I will wait until others have the chance to think about this. Any definition of breakeven is welcome. The most important point will be learned when one understands the implications of breakeven analysis. What is your definition or the commonly accepted definition accordin to you and how do...

Give the person a break. Isn't this his first post?

It is not your fault, and as per your other thread you seem to have sensed that something is wrong. I thought to wait a little to allow for others to give their answers, and then I will post my answer. Maybe someone will step in and give another answer that addresses the issue. If you need...

The breakeven is not $60.50. Post the delta (when you opened the trade), and I will tell you what the breakeven is.

There is more to it than that! You may need to scale up your thinking about this topic (if you actually traded/trade options from the buy-premium side).

You seem to have the right instinct, but if you accept what you learned in those books about how to calculate breakevens, you have just been "infected by a trading disease". Check this thread out: http://www.elitetrader.com/vb/showthread.php?s=&threadid=116489

A fellow (with years of experience in trading) asked me to see if I can help him in potentially improving upon his trading (in the sense of learning, doing better, etc). He has had (to various degrees) some of the problems that some traders experience. I suspected that if there is any problem...

Could you also tell him/her where or how you got that number?

So why you do not tell him how?

If I understand you correctly, The main reason of your exercise is to find an edge. There are three types of edges (you can subclassify of course and have other types): 1. The certain edge. This means that your edge will cut your opponent but never cut you, and you are certain. 2. The...

That's what a put does. Did you check saxobank, but their pricing may not be fair? Is this for trading or for business? If it is for trading I would stay away from anything non liquid

Where do you trade options on that pair? What type of put is it (american/european/etc)? What is the interest rate on SGD? Check the vol of that pair. The higher the vol the higher the price. CBOE.com has an option calculator.

I am sorry. That was meant for another guy who posted before you. He keeps following me from thread to thread because I was ignoring him. I responded to IV_Trader (who I find an excellent contributor), and followed with that sharp note to the other guy, which somehow appeared after your note...

Margin point is in my post. I did not miss that. And the answer to your point on margin is it depends on other things (rest of position, how margin is computed, etc). Here is an example. If you hold a long strangle position (OTM) and wrote against it a shorter term gut strangle, the risk...

You are an idiot