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Thats my bread and butter,but it's really margin arbitrage.Cant get very big even with PM. You have to be long wings to keep the margin police off your nutsack..

My 2.5 cents...Put trades on with however you choose to measure theoretical edge,and take them off when you realize it... If you are a punter,operate within a prudent risk reward framework... If you can mix and match,you are way ahead of the game

No question investing beats trading for 95 percent of those who dare to go mano y mano with Mr Market... Of that 5 percent, half the success rate goes to the best traders in the world,and the other half are the unfortunate investor who happens to get in at a major top :)

It's not random strikes being discussed,its the strikes with the largest open interest,I.e largest underlying notional.. I don't buy the whole peg manipulation

Didnt want to say too much before,but perhaps you should look at the ATR and see if a 1 ATR move puts you in loss territory...IMHO,you should have spent a bit of the credit to shift the R/R ratio..Of couse I am playing hindsight analyst,but the 10%+ ATR in RIOT was the reason I thoght you should...

If there's a bit of time left and that sucker trades for .05,I buy it in.You are spending .10 of your credit and shiting the R/R in your favor..i have the same spread ,but the next higher strike...

If you buy the 21 22. Call spread,you RR shifts dramatically.. You woukd be in the 19/20/21 1x3x2.... I always buy in the embedded short verticals..at the right price:)

I think the big question is at what price do you buy the 21-22 call spread,if it all??

Why not?? long a little gamma on the upside,makes money on a big jump up..

Yup,that's probably what he had in mind.. Do you think AAPL "settles" within the 134 straddle range??

He specifically mentioned the strike with the highest open interest. Does that strike have a higher probability of being pinned??

Fair enough :)

You do realize you are giving advice to a newbie. Why on earth would you recommend legging a spread.Bare minimum,if you are hell bent on legging,enter a spread order mid market first.. You clearly aren't trading stocks like TSLA in decent size.. More to the point,when a...

Right???? And I am the one grasping at straws :)

Amateur act You know not of what you speak.. Leg away

Did you know Steve Black?? He hired me at Smith Barney.. Salomon was a very very rude awakening for Steve,Jamie and Sandy.... I have really good stories on Solly bond arb dropping close to a billion when a billion wasn't an odd lot :)

What I liked about Tudor was he wanted no part of hedging or offsetting his bet/conviction.We covered him,and if he had a belief,he wanted to lever up the payoff for being right..

Oh,the hubris.. Never heard the call story..

Just out of curiousity,where would you place Simons??

Special deals is very kind :) The 80's were very light on the quant side,relatively speaking.. Until CRT came to the pits,no one had "trading" sheets on the floor... One smart guy for every 20 knuckleheads..on a good day