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I meant on a single position.. but yes , your point makes sense.

Thanks! Care to explain the rationale for your bearishness? Macro, TA, astrology, insider info?

This sentence made my day :D I think that what he meant was: 1- measure the parameters of the underlying distribution every day on multiple lookback periods. 2- use the resulting distribution parameters to determine the expectancy of your spread. 3- sell only the spreads with the highest...

Hi all, Anyone here got a view on where China's markets are going? I know there are a few China bears stalking these forums, however I would like to have a conversation grounded as much as possible on facts and as little as possible on expectations. I will state the facts I know: Pro Bear...

the issue is that it's very difficult to know if that position is really "the position" or simply a hedge to a play somewhere else.

yep I think that the 132/231 fly is used instead of the 121 when there is a directional assumption and skew is steep.

I think there is plenty of post by @destriero about it. there is also one page where one guy collected all the related threads: https://www.elitetrader.com/et/threads/the-staggered-butterflies.329827/page-3

eh eh eh.. Agreed.. different conditions call for different tactics. My question however was more about the playground than the game itself.. The responses I'm receiving are kind of comforting.

@Robert Morse Also, one thing: I usually think about the cost of carry in relation to futures/commodities.. how do you apply this concept to stocks?

I see. I was also expecting to hear something along those lines.. however the most interesting/valuable thing for me would be hearing about other traders caught in a similar situation, with all the juicy details.. having the knowledge of why something is happening is fine, but knowing how to...

Does it ever happen in the US?

Hello, in my particular market (China) the P-C parity started breaking down during the past weeks. In the beginning I could explain the small IV difference between call and put with the interest rates, but recently the divergence is becoming really wide. We are talking about calls at 14%IV and...

here even the 70 years old granny is dabbling in the stock market.

ok, here a few facts: -one options contract commands 10000 shares instead of 100, of course the value per share is quite low, around 0.35 USD per share on the 50ETF -in terms of liquidity, I would say its very good, the spreads are really tight. At the ATM level the spread is usually .0001, it...

I am currently trading the 50ETF options, what do you want to know? In terms of brokerages available to foreign customers I have no idea, I reside in China so I have done everything through local brokers. If you want info about the market situation then maybe I can tell you a couple things.

volume can be used as a data point, but in its raw form is too noisy to be useful.

The problem is that you have already decided that you want to buy that put, so no matter how much sensible advice you receive, you won't change your mind. The only way you could pull this off is by legging into a trade where you were initially correct on direction, so you already got some...

1) If you do that, the resulting structure would have the same risk graph of a covered call. You should study a bit synthetics, in order to avoid creating a complex structure that achieve exactly the same result of a simpler one but with 3X commissions and slippage. 2) you can go to...

Ok now it's clear. Buying a put would be an insurance against a sudden violent downward move, but the situation that you describe is more like a slow drift. In that case buying a put will do you more harm than good. If you expect the stock to go down a bit but then sit on some support level...

my scanner (ok I admit, is not really that much optimized) takes around 2-3 minutes to scan all the possible combos for one product. I cannot imagine how long it would take to scan an entire market, let alone all markets..