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The crash occurred two months after the market's zenith. Wasn't the market hitting 52-week highs a few weeks ago? The crash of 87 occurred after a parabolic rise in the months leading up to Octobere. No parabolic rise on any of the one-year charts that I see.

Amen to that. Selling cheap calls after sharp declines--NASTY habit. Much better to buy them.

Perhaps someone can clarify this for me, but buying both sides (the plain vanilla straddle) and then scalping seems superfluous when one can simply do a synthetic and scalp (as described in Natenberg). Either way, one is trying to pay for theta decay while being prepared to take advantage of...

Would one HAVE to buy/sell a straddle? Couldn't one simply buy either puts or calls and then hedge with the stock/futures (buy 2 atm calls/sell 100 stock; sell 2 atm calls, buy 100 stock)?

I have always noted some minor (and sometimes major) typos and such with my year-end statements with IB. One must check, and then check again. After all, I don't see the IRS accepting the "it's not my fault, it's IB's" line.

Being short stock (short call + long put) and being short calls (short call) are not synthetically the same. That was not my point, nor has it been the point of this thread (I think this thread has a point. Then again...). As for the point that "max loss is easy to see in most cases," how...

No, the risk in being long 100 shares of stock is precisely defined; the risk in being short 100 shares of stock is not defined. For being short stock/short calls, the risk cannot be quantified.

How, then, can one QUANTIFY the maximum future risk of naked calls?

Indices and commodities do not tend to gap like stocks. But THEORETICALLY naked puts have limited risk; naked calls don't. That is true for all instruments, whether you're trading coffee or Starbucks stock. Risk for naked puts can be quantified; the same is not true for naked calls. That...

Naked puts have limited risk, naked calls have unlimited risk. The price of the stock is irrelevant. For that reason some brokers will allow one to sell cash-secured puts. But I have yet to hear cash-secured calls.

I have no doubt that Williams won the Robbins Cup contest. Based on his performance in that contest, I am impressed. Nevertheless, he has had other problems, discussed in the Gallagher book and here. Bottom line: he has had much less success managing opm than he has managing his own...

If you are temporarily bearish on OIH in that you expect 130, then I'd sell the 130 straddle, or, if you simply want to end up with the stock/etf, sell the 130 puts. If you are bullish on OIH in that you think it will go to 150, then sell the 150 straddle, or just the 150 puts. Selling...

When it comes to trading futures, astronomically high returns are only possible with astronically high exposure--risk. Actually, a 50% drawdown is less than I would have expected, considering his performance in the contest. There are some CTAs who have had twelve-month returns over 1000%...

Clearly the PRIORITIES were different: clients come second; his own contest and ego, first.

That tends to be true, but if oil prices keep going down, so will natural gas.

Yes, we and the British bailed them out but they gave us the a good part of the Enlightenment, the intellectual foundation of this country. So we're even.:-)

34.27% of total taxes defined as what? What exactly is being included here?

That is THE definition of zero sum. At the same time, a person is free to believe any definition he or she wants, silly or not.

Taken as a SUM (all buyers, all writers), yes, no money is made. There are INDIVIDUAL exceptions, of course. I would add that options and futures are less than zero sum. They are zero sum minus spread minus commissions.

On Sunday evening around 7 PM they liquidated March ZN futures, and then Monday morning, when I checked, the futures magically reappeared. In the meantime, I bot June futures. I don't know if they actually rebought the futures. All I know is that they were gone one day, and were back the...