Its not the IV diverging,its the price ratio going bonkers(AAPL outperformance).You are correct that depending on IV levels,he MAY be able to short spreads in AAPL and go naked long SPY vol.
havent done this in a while,but I concur, he should take the ratio of SPY/AAPL and start there..You can beta adjust it,vol adjust..I would check the ratio of the historical rolling implied vol as well as the ratio of SPY to AAPL..Scaaawwwwy trade
calm down..
I was genuinely trying to help when I posted...
Your way of thanking me was
Yeah,I brought the heat in return,and i apologise for the butthurt:)
We are talking about a lad who doesnt see the relationship between implied vol and realized while delta hedging..
Not too mention,I was genuinely trying to help him..
Multiple accounts??? Hallucinate much??
Taowave regrets having one account when dealing with stubborn noobs like you,you think taowave would create a second account???
Ild rather stick sharp needles in my eyes...
You are trading months out and trying to eiminate vega risk??
Lets say I bite...
The comedy show that never ends
Dum Dum,you are the one that brought up dynamic hedging......
No such distinction between realized vol and implied volatility????
Say WUT?????
Show us one trade you have actually put on the books.
How does one specialize in 2 leg constructs without ever trading ??
And you are oblivious to realized vs implied while delta hedging??
What edge as a retail trader do you think you will have trading vertical and calenders while attempting...
Not true....
Its a question of Implied sold vs realized vol..
It's very very path dependent to keep the "whole thing"..
Anyone with discipline can do a good job hedging,it's a question of the market behaving and not gapping,i.e higher realized vol..
With all due respect...How do i phrase this...STFU.....
You haven't made one trade in your life and have no clue to which end is up,and you are blabbering on in another thread about making 30 percent plus..per month...while not comprehending assignment risk..
So go trade boxes and jelly...
Let me save you from years of mental masturbation....
Focus on #1. Put your effort into becoming proficient at directional trading...
If you can do that,everything will fall into place.
Skew,sticky delta,sticky strike are good info,but i do not believe thats what puts bread on the table.
As a...
You should run backtests before making these assertions.I think it would really help
Im not sure what yor point is regarding "cash is tied up in some stock that will bite you eventually" is a strange thing to say..Of course something/everything will bite you sooner or later...Its a question of...
He somehow managed to get back almost 600k of it...
"Yesterday I watched nearly $1 million evaporate from my day trading accounts in less than an hour. By the end of the day, I was able to make a good chunk back, but I still finished the day at -$409k."