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Please do not put words in my mouth. I never wrote that one should or should not trade those options, but the fact that very high returns on options exist can be proved by looking at the % returns on the option chains on expiration day. Since those returns exist, someone must pay for them.

Why you do not sell them then? There is a reason they call them wings. If there is wind, they can make you fly.

What if there are other things that you do not know yet that make trading more of a negative sum activity? Fixing a hole in the bucket does not mean there are not other holes or there would not be other holes.

Does it say more than trading is a negative sum activity?

Thanks for sharing!

Before I explain the difference, thank you for the link. In the first reading, I did not even notice that there are multiple pages (I think the navigation could be made clearer). My definition of R is different from the Parkinson's definition, but I find Parkinson very interesting and I could...

But the RR would be "small", not be more than say 5? Among OTM, there should be higher RRs.

This is a very good post! I would add to it that when one is confident and correct in a direction, the attitude could also be to add to original position or if to take some profits on what was to reenter on bounces and to keep the original position open as long as the scenario is developing...

Thanks. Any fundamental reasons behind it? How do incorporate it in a chart as BB are usually in multiples of S (S, 2S, etc).

I did not ask about how to compute S (standard deviation), but about the behavior of R/S (where R is the range).

I agree with you. The option I showed is something I followed at one point in the trading day, and then went back and looked at its trading range . What RR would make such trades more frequent?

I do not have the chart, but only the stats I showed above. There used to be a place where I could plot the chart of an option, but they stopped the service. If someone knows of a charting place, I am also interested to know.

As an example, the 88-strike qqq put that expired today traded from a low of $1 to a high of $175 a contract. The trading volume was $31.7K. R/R: 175:1. Are there success stories/books/people/services that specialize in long side trading strategies of such cheap options ?

:cool:

What is the best offer prop firms can offer? PM it to me. Mods: if this thread is not in the right place, please move it/remove it as you see fit. Thanks.

Did you follow the models today?

Do you trade the weeklies?

Good work! Thanks.

:) . In general you are correct, but in this particular case I was really interested only in the telling. I would also like to add that I show up here from time to time because I like your writing and the posts of others. Not many people can write well like you do. In addition, a number of...

Did anyone do work (or know of work that was done) on trading range vs. standard deviation of price.? If you need notation, let us denote by R the range (Max-Min), and by S the standard deviation. Of interest is the behavior of R/S. (not to be confused by Resistance/Support). Thank you!