Can you post it in some screenshots, instead of a .CSV file?
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50% returns selling options with max 50% drawdown per trade!
- Thread starter nooby_mcnoob
- Start date
Can you post it in some screenshots, instead of a .CSV file?
Can you post it in some screenshots, instead of a .CSV file?
After a nap, I have decided this thread is the result of being drunk.
eat like bird poop like elephant...
every few years there will be some hedge funds running some strategy like this and put up a string of all-win months and investors who don't know any better rush in, only to be wiped out by 1 black swan..
if it's just a straight sell then there is no edge, correct?
The last sentence is correct. To make money you have to correctly combine all premium collection with everything you know about the markets and about the underlying over the years, which will result in frequently selling only one side, or placing one side much farther away, or hedging one or both sides, etc. In other words you get paid for judgment.
The first part of the above is mostly wrong, though. Sure funds and traders get wiped out with a single event, but that's not the norm, even though it's sensational so we all hear about it. The NORM is that, if you are DIVERSIFIED in premium collection, you will never make money in almost any month unless your judgment on both legs turns out to be correct. You will get hit all the time, hard, on at least some of the legs in some of the underlyings and that will take away all your profits every day, every week, every month, every year. Generally speaking.
Unless you are concentrated into collecting premium on a single underlying, in which case you will make money for months and then be hit super hard by materialization of an event risk, that should have been obvious all along and that will wipe half or more of your equity out.