Favorite Trading Strategies

Quote from OddTrader:

Seems you can only Guess, and merely Guess, Again and Again! Probably that's what you can do the best!
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Guess what? I Guess that I'd rather be profitable from my Guessing instead of being really smart and posting on ET all day long :)
 
After years, for the same old story:

"Reverse Collars"
http://www.elitetrader.com/vb/showthread.php?s=&postid=1322230

01-06-07
Quote from Eliot Hosewater:

I'm starting this thread to discuss reverse collars mentioned by "4Q" (borankin), our visitor from the Optionetics board.
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Quote from spindr0:

01-11-07
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Quote from exQQQQseme:

Spin or Don:

Where is the carrying cost (other than the margin interest charge where
applicable) when the stock is shorted?

Bob
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There's no carry cost for this situation. In fact, you should be receiving the interest. But as Don noted, since most brokers pay little or no interest on the proceeds from short stock, the reverse collar will underperform the synthetic call (or put) vertical by this amount.

As a general statement, for a collar (long or reverse) or any other option position, if the underlying makes a strong move against you, adjustments will not make the position profitable. They will just diminish the pain.

The only way that the option adjustments will be profitable will be if you add more risk (overwrite the short leg, buy more long legs, or roll). Eventually you will need to hit on one of these or have the underlying reverse. At some point in time, the stock will have to cooperate in order to make up the inherent risk within the hedged boundaries.

Spin
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Quote from exQQQQseme:

01-11-07

Spin, why is it that you and a few others keep trying to argue with me and convince me that synthetics are better than collars? I have said more than once that I can't argue with you guys because I don't know that much about the synthetics. Matter of fact, as I get into it further I am understanding where you are coming from.

So, stop attempting to argue with someone who does not disagree with you.

Bob
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"ITM Covered Call vs. Naked Put"
http://www.elitetrader.com/vb/showthread.php?s=&postid=1397576

Quote from spindr0:

03-15-07
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Quote from exQQQQseme:

asap, I understand the "synthetic collar" part of your statement, but am having a difficult time envisioning a "riskless" situation. If you have a few minutes, I would greatly appreciate an example.

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It might help to know that the synthetic of a collar is a vertical spread. So if you leg in and can net a credit equal to the difference in strikes, it's riskless.
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Quote from wayneL:

Sounds like something Lao Tzu might have said. ;)
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You can watch every moves of Michael Jordan or Tiger Woods and watch them from every angles. But how likely are you going to become another MJ or Tiger Woods ?



Just because you tell someone your trading secrets, it does not mean other people will profit as much as you from it. Most people still prefer to go their own way.

Remember the saying, it is hard to learn from other people's experience.

I remember someone from the Market Wizards books talked about same thing.
 
Quote from spindr0:

Perhaps he should drink the Kool Aid

:)
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After some research on what Kool Aid is ( we don't get that outside the US) and what "drink the Kool Aid" means...

**wonders whether Kool Aid has already been consumed. :D
 
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