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Volatility in not exponential, it is a random variable. Some believe daily vola is a gaussian distribution, others don't. The two things to be aware of are 1) high volatilty is usually followed by high vola and the same for low vola following low vola, 2) vola is mean reverting process...

Its funny how I point out some discrepancies in your knowledge base and you get offended. Its okay to get upset, however, it might be helpful for you to let go of your ego. One day when someone tells you that you need to work a little harder, you'll thank them, it will help your bottom line...

Jeez people... How many here do not know that *generally* rising prices => low volatility and falling prices => high volatility? Honestly now? That's very *BASIC* knowledge IMO... And this crap about the market being "fixed"... ? HUH? I'm laughing as I write this... to think someone...

Let's analyze your sentence structure there genius: There is no such thing as "A"; only "B". Therefore, those who a advocate "A" have low "B". Do you realize that in using the logical reasoning above you'd fail a simple IQ test? Let alone score above a 10% percentile on any standard...

You'll find some good information from this site if you do a search and sift through all the BS - the information is here, it can be a challenge to find however. Off hand, Mschey and Steve_Tvardek are good traders to pay attention to - many others here give good advice as well. From my point...

My thoughts as well... Michael, Honestly now -- how much time do you spend writing on this site about the void in your life? You don't trade for a living and you admittedly think trading fulltime is impossible to do so why bother seeking acceptance here? Maybe you should move on and...

Admitedly, when I read your first post about the uselessness of Math and Quant degrees for trading I laughed... but after reading some of your later posts I realized that you are genuine and you simply lack some basic knowledge. My trading is part discretionary and part "systems". The...

Seems like you answered this question in your very first post: "thing that has really slaughtered my equity is opening foolish positions and not getting out. I sometimes have put on these "lotto ticket" trades" Discipline is your problem and you know it. I suspect we all have discipline...

Personally, in terms of computation, Mathematica is by far the best out there. I use it for volatilty modeling/forecasting on a very large scale. Performance wise, Matlab pales in comparison when manipluting large arrays of data using built in functions. If you can stomach the price ($1800)...

I believe he bought 600k shares on March 16 2004. MAMA traded between $9.50 and $10.48 that day. Today its at $4.20. Assuming he held through the $0.86 52 week low (yep .86!!), he's been holding one huge bag for the last 3 years.

This is a great point and gets to the heart of the issue. IV is directly based on the current market price, hence the current IV cannot provide statistically viable information other than what the *price* of the underlying asset already provides. GARCH is a historical function fit of...

Your opinions have merit, however, you imply that certain “random” factors cannot be quantified. In your example you mention accounting scandals and takeover bids. While these events are non-deterministic in nature, general trader sentiment can be modeled by price volume analysis. There do...

This a thread intended to help my self as well as others understand the nature of volatility modeling. Disclaimers: 1. I am not an expert; my knowledge of options trading is intermediate at best. However, I do have a very strong mathematical finance background and would like to hear about...

Same here. 2004-2005 were relatively flat market years, IMO difficult to trade. 2006 and this year so far are fantastic... I question your experience level given you have such high opinions of your recent performance - Not to say that it isn't great performance, but, as pointed out above...

I think there is some confusion here on what GARCH and IV actually are. Please consider that when you make a stupid statement about the merits/flaws of a mathematical model, you best *understand* the model (especially a Nobel prize winning model). You know who you are... Implied Vol is a...

All stocks. For example, suppose I made 1000 trades last year totaling 1mil shares at $10 mil buy amount total and $11mil sell amount (aggregates). Thats $1 mil in profit/income. Those are the numbers the IRS cares about. If you are holding over the course of a year you can elect mark to...

Total Shares bought and Total Shares sold. Total amount ($$) bought and total amount ($$) sold. The IRS only wants the total amounts, you do not have to list every individual transaction. Mike

Along the lines of Makosgu's post: P = D (1 + g)/(r - g) P = share price (asset/underlying price) D = dividend or profit margin g = growth rate of dividend r = riskless rate of return --> directly proportional to interest rates and bonds. Hope this helps. Mike

That was the first post in some time that actually put a smile on my face. LMAO... Couldn't of said it better myself. Thanks:)

Your time frame may be a deciding factor. Give the trade entry more time and allow your stop to be a worse case scenario. Allow for more adverse price movement with smaller initial size. Then add as the trade starts to work. Combine the above with an ability to correctly analyze and...