I am dumb.
I am profitable only when I trade single legs. Every time I tried something fancy, like straddle, strangle, calendar, butterflies, condors, spreads... I lost money.
A Non-Correlated Strategy Trading Journal That Shows Profit
- Thread starter raVar
- Start date
I am profitable only when I trade single legs. Every time I tried something fancy, like straddle, strangle, calendar, butterflies, condors, spreads... I lost money.
Alright, we are still going to sell a spread in this environment (note, that will not always be the case ... in other words, we may not sell them at the end of each week) for the sake of this model. I'm going to go ahead and sell next weeks spread, a little early, and do it this week.
Selling, for the sake of the model ... ONE November 22, 2019 QQQ 205 / 209 for 0.18
I'll update the spreadsheet in just a sec ...
Pop Quiz: There are several ways to be "non-correlated". So what type of non-correlation is this? (Hint: It's the type of diversification most don't think about, mentioned in the opening white-paper). The answer to that, would lead you to why I went ahead and sold next weeks, already ... and maybe how we will pick and choose our spots ...
As always, to see how we are doing on each process? Check out the tabs in the spreadsheet below. Thoughts, questions ... comments? Post 'em below!
_______________________________
Simple Longer-Term Hypothetical Non-Correlative Strategy Processes: https://www.elitetrader.com/et/thre...ournal-that-shows-profit.337303/#post-4951437
Spreadsheet: That keeps track of each trade, each process, and then everything together ...
IF YOU ARE ALREADY AN OPTIONS TRADER, Here is a Disclaimer: I know, I know, I know ... as well as a secondary ... I know ... I know ... I know
Selling, for the sake of the model ... ONE November 22, 2019 QQQ 205 / 209 for 0.18
I'll update the spreadsheet in just a sec ...
Pop Quiz: There are several ways to be "non-correlated". So what type of non-correlation is this? (Hint: It's the type of diversification most don't think about, mentioned in the opening white-paper). The answer to that, would lead you to why I went ahead and sold next weeks, already ... and maybe how we will pick and choose our spots ...
As always, to see how we are doing on each process? Check out the tabs in the spreadsheet below. Thoughts, questions ... comments? Post 'em below!
_______________________________
Simple Longer-Term Hypothetical Non-Correlative Strategy Processes: https://www.elitetrader.com/et/thre...ournal-that-shows-profit.337303/#post-4951437
Spreadsheet: That keeps track of each trade, each process, and then everything together ...
IF YOU ARE ALREADY AN OPTIONS TRADER, Here is a Disclaimer: I know, I know, I know ... as well as a secondary ... I know ... I know ... I know
Last edited:
Then we must agree to disagree on the idea of being "dumb".
And nothing wrong with just selling spreads. As you know, I've said many times there are 'smarter' ways to play the markets with options. Heck, there smarter ways to play spreads, come to think of it. But spreads are 'viable'.
Reminds me of this conversation I had with another Options Trader years ago. Guy was smart as a whip. Though we didn't get along. At all. And that's not uncommon in Finance. Icahn-Ackman / Einhorn-Musk fueds are NOT an uncommon thing. LOL ... remember him looking at me as we were discussing a topic, and I was tying to be polite, and he just came out and said: "Listen, I don't like you. At all. And I don't care if you like me, so cut out that polite bull-crap".
LOL.Regardless, he fell into the usual trap that many option traders fall into. Since they have that myopic view of the one differential equation that sort of defines their entire world view ... they have a hard time seeing outside of it.
I forget what the conversation was even about. But spreads came up, and per usual with dedicated Options Traders, he was jumping straight to the "smartest" way to play something, since I like to use Outrights (Playing XYZ market, by just 'buying' it directionally) and then using other methods to brace off the risk of that directional purchase. He was going on and on and on and on about the smarter way to do it ... since my approach DOES cut down on BP (Buying Power ... or the efficient use of my Capital), by quite a bit. In fact, most of what I do personally? Is with Outrights directional purchases on underlyings.
So he's railing on and on and on about the smartest way to do it.
And he was right, for the points he was making.
And even that guy, at the end of the conversation, had to concede me this point, which was ...
"I'm not denying one word of what you're saying. But something doesn't have to be 'the best' from a Black-Scholes perspective. Someone could use the outrights for other reasons (scaleability, etc), and understand they are sacrificing BP for something else of what they want to achieve. GOOD IS NOT THE ENEMY OF PERFECT. And if someone wanted to? You and I both know that they could just use spreads, and nothing but spreads ..."
And even he said:
"Yeah, they could use just spreads. But it wouldn't be the 'best' way to do it, and that just wouldn't make sense because of blah blah blah blah ...."
As I've said before? Newcomers to Options tend to go to spreads first. I don't know why. But they do. Someone else just posted their first strategy on ET? And yeah ... it was spreads. Even this guy who just came out and told me he hated my guts, had to admit it.
It's viable.
But like all things, the devil is in the details.
Last edited:
Thank you for your encouragement.Then we must agree to disagree on the idea of being "dumb".
And nothing wrong with just selling spreads. As you know, I've said many times there are 'smarter' ways to play the markets with options. Heck, there smarter ways to play spreads, come to think of it. But spreads are 'viable'.
Reminds me of this conversation I had with another Options Trader years ago. Guy was smart as a whip. Though we didn't get along. At all. And that's not uncommon in Finance. Icahn-Ackman / Einhorn-Musk fueds are NOT an uncommon thing. LOL ... remember him looking at me as we were discussing a topic, and I was tying to be polite, and he just came out and said: "Listen, I don't like you. At all. And I don't care if you like me, so cut out that polite bull-crap".
Regardless, he fell into the usual trap that many option traders fall into. Since they have that myopic view of the one differential equation that sort of defines their entire world view ... they have a hard time seeing outside of it.
I forget what the conversation was even about. But spreads came up, and per usual with dedicated Options Traders, he was jumping straight to the "smartest" way to play something, since I like to use Outrights (Playing XYZ market, by just 'buying' it directionally) and then using other methods to brace off the risk of that directional purchase. He was going on and on and on and on about the smarter way to do it ... since my approach DOES cut down on BP (Buying Power ... or the efficient use of my Capital), by quite a bit. In fact, most of what I do personally? Is with Outrights directional purchases on underlyings.
So he's railing on and on and on about the smartest way to do it.
And he was right, for the points he was making.
And even that guy, at the end of the conversation, had to concede me this point, which was ...
"I'm not denying one word of what you're saying. But something doesn't have to be 'the best' from a Black-Scholes perspective. Someone could use the outrights for other reasons (scaleability, etc), and understand they are sacrificing BP for something else of what they want to achieve. GOOD IS NOT THE ENEMY OF PERFECT. And if someone wanted to? You and I both know that they could just use spreads, and nothing but spreads ..."
And even he said:
"Yeah, they could use just spreads. But it wouldn't be the 'best' way to do it, and that just wouldn't make sense because of blah blah blah blah ...."
As I've said before? Newcomers to Options tend to go to spreads first. I don't know why. But they do. Someone else just posted their first strategy on ET? And yeah ... it was spreads. Even this guy who just came out and told me he hated my guts, had to admit it.
It's viable.
But like all things, the devil is in the details.
Actually I don't even trade spreads, I just buy and sell calls/puts single legs.
Ravar said:
Guy was smart as a whip. Though we didn't get along. At all.
Go figure...
Guy was smart as a whip. Though we didn't get along. At all.
Go figure...
Like just sell em out naked?
That's just as viable as well.
Sometimes I worry that ones see a "model" like this one, and as many times as I say ... it's just to illustrate principles ... ones take it that I mean "Do this ... XYZ".
Selling calls and puts is just as viable, if the strategy itself gives positive expectancy.
Or heck, I know a guy in Chicago ... does DEEP ITM calls and puts, and buys them. But he pulls a draw from it, so it's viable as well.
Just ... two different things ... talking about how they are different, is the main thing.
Myself? I'm strategy agnostic. In my time, I've seen so many profitable strategies, it's more of a matter of 'what you like', than 'what's correct'.
Hmmm... I wonder who that smart as a whip guy who he doesn't get along with is???
Well... looking back at Ravar's prior ET handles sheds some light on it...
https://www.elitetrader.com/et/threads/tim-sykes.284260/#post-3982317
I've run into Tim on a professional basis. He is the real deal. … He and I don't get along. He is Rude, and Arrogant
LOL
Well... looking back at Ravar's prior ET handles sheds some light on it...
https://www.elitetrader.com/et/threads/tim-sykes.284260/#post-3982317
I've run into Tim on a professional basis. He is the real deal. … He and I don't get along. He is Rude, and Arrogant
LOL
Well, first of all actually the guy that I was talking about earlier, his name is Ron.Hmmm... I wonder who that smart as a whip guy who he doesn't get along with is???
Well... looking back at Ravar's prior ET handles sheds some light on it...
https://www.elitetrader.com/et/threads/tim-sykes.284260/#post-3982317
I've run into Tim on a professional basis. He is the real deal. … He and I don't get along. He is Rude, and Arrogant
LOL
Second, I have no idea what you're talking about as far as being on ET earlier?
Third, I'm actually sort of intrigued that I'm considered such a point of intrigue that one's think I have alter egos or something ... That I'm posting on this form with multiple IDs? Old saying about when you're up in someone's mouth all the time, that must mean that you occupy their thoughts a lot.. I don't know whether to be creeped out? Or flattered? Or creeped out and flattered?