Delta neutral or directionality: which one do you pick?
- Thread starter ferrycorsten
- Start date
What you fail to understand is, since I am using a different strategy than you, I must use different criteria to evaluate the probability of the trades outcome being successful.
The fact is, I consider volatility in each and every trade I either consider,... initiate,... or close.
For example, if I see a potential trade I'm considering is coming into a pending earnings release, I'll want to initiate the trade for the higher credit the uncertainty is offering.
But will I?
YES,... if my fundamental and technical analysis, (which you and others ridicule), reflects it is a reasonably valued strike and the company is financially healthy.
That being, the stock is RECOVERABLE, if they miss earnings.
NO,.... if my analysis, (which you and others ridicule), reflects the stock is over valued, is carrying excessive debt, has rising inventories, has been selling assets to raise cash, has been slower than usual when paying it's bills on time, insiders have been selling, they've been cutting back on R+D, and so on....
In addition, you will notice 99% of my stocks have been in a down trend for a while, when I initiate a bullish naked put trade.
And 99% have had % drops the actual day the bullish trade is initiated.
That is another example of how I take advantage of vol on all my trades, thus getting me the best credit, strike, and otm cushion, to earn my 13 - 19% annualized return, and a high probability outcome. (All of which you ridicule).
I really don't understand why some find that concept so amusing.
Put simply, it's about how I use vol to my advantage, when initiating trades. And how I use my criteria to avoid trades, even when I'd like to take advantage of the current vol.
My most recent $10 ALLT trade and it's 16 - 17% return, is an example of what I discussed above.
Why you do not address the volatility question?
Let us compare your cushion to a 30inch pillow that you can imagine you have put on your nose as if protecting against a punch. The 30inch might be safe if a gentle woman is doing the punching, but what if it were a Muhammed Ali in his prime doing the punching? The 30% thickness of the cushion is meaningless unless coupled with a number to measure the speed and intensity of the puncher.
The same can be said about the premium.
In options, do you think a high premium involves punches from a boxer like Muhammed Ali or a gentle woman?
My fundamental analysis tells me if I'm dealing with a silly girly man puncher like you, or an ultimate fighter.
If you still don't understand, i suggest you keep re-reading my posts. I have a feeling you tend to skim them rather then actually read them.
Hence the reason I tend to ignore your questions, which I've answered many times in discussion with you and others.
Or is this your clever way of getting me to send you more music to listen to?
If you still don't understand, i suggest you keep re-reading my posts. I have a feeling you tend to skim them rather then actually read them.
Hence the reason I tend to ignore your questions, which I've answered many times in discussion with you and others.
Or is this your clever way of getting me to send you more music to listen to?
Is that the same answer you gave in the other thread or is it the opposite answer?
If the answers are opposite, what is your final answer?
Do you know why they care about risk-adjusted returns? Are your stocks more or less volatile than say SPY? If more by how much? Could it lead to an implicit leverage?
You guys are hilarious.
On and on and on. Talking endlessly about nothing.
http://www.youtube.com/watch?v=3RwxdzP8rG4
There are many brands of baloney, but in the end it is all just baloney.
On and on and on. Talking endlessly about nothing.
http://www.youtube.com/watch?v=3RwxdzP8rG4
There are many brands of baloney, but in the end it is all just baloney.
So tru, but they the ones hiding behind some theories of trading will never admit that, they "sell" or "bill" themselves as some sort of guru that is salable to a fund not "vol." trading ... its all a scam
there is a time for delta neutral and time for direction, there is no static stategy.
after being completely away from the market for five years
I thought maybe I wanted to go into the insurance business
and just start writing options
they had a thread "Selling Short Straddles"
It had like 100 pages
and I spent a Saturday reading every post
the one that got me was about half way through
I don't remember the poster's name
It went something like
"I've spent hours and hours, and years and years, trying to figure out how to turn the market into my own personal ATM."