Going long 100K QQQ's tommorow

I am absolutely lovin it. Don't change a thing. Please let us know just when you will make your trade so we can "get a feel" for how you do it.
 
Quote from nitro:

Oh,

LOL. That is not size. Unmargined, that is about 3000 Qs. I put that position on twenty times a day.

nitro :D
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yeah sure ya do..

20 X/day!

and "genius" is making a mint...

ha.

:-/
 
Quote from nitro:

You have to look back years to have had 7+ weeks of lower or equal closings on a weekly chart. Not a single closing higher than the previous week eight weeks in a row now (1/2001 was the last time I believe.)

That would not sway me, but some people trade that way.

The thing I like least about the trade is that it is options expiration week, and with the current plumetting of the spoos, gamma is gong thru the roof (momentum wise.) That means that there is likely to be a negative feedback loop here where the spoos are sold off, then stocks have to follow suit the next day, fueling more spoos selling, and the cycle may end not earlier than this Thursday where options strikes and open interest on them begin to hold the selling pressure.

Also, he may be scalping gamma against the position constantly, or may have a protective put somewhere beneath (synthetic call.) We don't know...

But to hold 100K Qubes 'till then? Naah, my guess is the guy is going to be up all night if he holds the position overnight tomorrow, and if things are looking bad, he will be selling 125 NQ on the way down of the overnight session to be delta neutral on the open :eek: I am looking at the DOM on the NQ right now, and he can sweep the book only two handles down at any time to hedge. It is actually not that crazy, but there is no profit target or if he will hold the position overnight or not.

If he is willing to hold overnight if the P/T is not hit during RTH, he probably doesn't want to miss the meat of an up move overnight if his profit target is not hit during RTH, and figures he can control his risk on the way down and decide the next day to peel off the NQ shorts and leave the QQQs long if the market looks like it might turn during RTH.

nitro
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Wow!! Does anyone understand what he just said? I love your posts, Nitro, but this one is way over my head. One thing is certain, options expiration will have a huge effect on trading this week. Love him or hate him, Cramer has some interesting comments today on the strike prices many big caps are pegged to.
 
Quote from tdoc:

Wow!! Does anyone understand what he just said? I love your posts, Nitro, but this one is way over my head. One thing is certain, options expiration will have a huge effect on trading this week. Love him or hate him, Cramer has some interesting comments today on the strike prices many big caps are pegged to.
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it's his little joke.

it's his little way of saying how UNimpressed he is with it all.

ya see.. he's got a little "genius".

:-/
 
Quote from tdoc:

Wow!! Does anyone understand what he just said? I love your posts, Nitro, but this one is way over my head. One thing is certain, options expiration will have a huge effect on trading this week. Love him or hate him, Cramer has some interesting comments today on the strike prices many big caps are pegged to.
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tdoc,

LOL! I am turning into Jack Hershey/Grob.

Lemme refrase, OK?

You have to look back years to have had 7+ weeks of lower or equal closings on a weekly chart. Not a single closing higher than the previous week eight weeks in a row now (1/2001 was the last time I believe.)

Better?

nitro :D :D
 
Quote from tdoc:

Wow!! Does anyone understand what he just said? I love your posts, Nitro, but this one is way over my head. One thing is certain, options expiration will have a huge effect on trading this week. Love him or hate him, Cramer has some interesting comments today on the strike prices many big caps are pegged to.
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Where did you find cramer's comments... I'd like to read them.

Thanks!


I
 
Putting on a short-term trade just before the Fed announces its rate decision is rather unwise IMHO. Why not wait till the close when you know their decision & comments, and how the market has reacted?
 
Quote from tdoc:

Wow!! Does anyone understand what he just said? I love your posts, Nitro, but this one is way over my head. One thing is certain, options expiration will have a huge effect on trading this week. Love him or hate him, Cramer has some interesting comments today on the strike prices many big caps are pegged to.
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You're not the only one confused... as expiration approaches, gamma does increase, but the increase in volty acts to decrease gamma. Gamma peaks at the atm strikes, rising as volty FALLS and as time passes.

I guess he's trying to make some analog to portfolio insurance, but I don't see any causation. The option market is in equilibrium -- the increase in volty lowering gammas, and vice-versa.

I will agree that options expiration will tend to lower the stat volty thru the hedging activities of the coversion/reversal arbitrages, but not much of an influence.

riskarb
 
Quote from riskarb:


I will agree that options expiration will tend to lower the stat volty thru the hedging activities of the coversion/reversal arbitrages, but not much of an influence.

riskarb
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Before anyone jumps down my throat, I am speaking generically when stating "hedging" -- referring to pin risk, unwinding, et al.

riskarb
 
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