Just returned and found this. Nice.
HowardCohodas Index Options Credit Spread Trading Journal
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I want to be short premium, earning time decay, and to profit from extreme price movements either way, always earning X% or at least breaking even + 1 tic at expiry. All unforeseen disasters should help my position and not jeopardize it.
In other words I want to have the equivalent of a long straddle, that profits from the passage of time.
In exchange for all those benefits I'm prepared to scalp like crazy in the interim by providing liquidity to the market. Every order that gets executed must provide me with a strategical or tactical advantage.
I want to pay zero commissions and have positive slippage in all my trades.
I want to be in control of my position risk at all times, and never surrender control of it to the market.
I know I'm asking for too much, but please help me.
In other words I want to have the equivalent of a long straddle, that profits from the passage of time.
In exchange for all those benefits I'm prepared to scalp like crazy in the interim by providing liquidity to the market. Every order that gets executed must provide me with a strategical or tactical advantage.
I want to pay zero commissions and have positive slippage in all my trades.
I want to be in control of my position risk at all times, and never surrender control of it to the market.
I know I'm asking for too much, but please help me.
Eduman
A long straddle that profits from Time Decay?
Hmmnnn! I´ve been experimenting with a couple of newer trading systems and still losing paper money and a little bit of real money. I am currently for this month trying the long straddle, so you got my attention. I´ve only one week in it though. So need more weeks practice. I can see the possibility of getting it commission free though. It´s the non predictive capability of the long straddle that interests me. How to capitalize on it? Limiting the time, so TIME DECAY doesn´t hurt you too much. Cannot even fathom how to do it, gaining TIME DECAY?
A long straddle that profits from Time Decay?
Hmmnnn! I´ve been experimenting with a couple of newer trading systems and still losing paper money and a little bit of real money. I am currently for this month trying the long straddle, so you got my attention. I´ve only one week in it though. So need more weeks practice. I can see the possibility of getting it commission free though. It´s the non predictive capability of the long straddle that interests me. How to capitalize on it? Limiting the time, so TIME DECAY doesn´t hurt you too much. Cannot even fathom how to do it, gaining TIME DECAY?
Eduoman
If you want to send me some secrets on how to do those things, be glad to get them. I just opened a forum on here for the Long Straddle tweeks and hints. You can send something proprietory to my email if the public forum would bother you.
If you want to send me some secrets on how to do those things, be glad to get them. I just opened a forum on here for the Long Straddle tweeks and hints. You can send something proprietory to my email if the public forum would bother you.
fw: Only throwing ideas out for an "ideal" situation. Every real implementation will have its chinks in the armor.
If you are convinced that one side is more likely than the other, then you don't need both wings open ended. If nyou think a price will not last for long, you can do something else.
Also as time passes and new prices become reality, you are free to morph your initial position. Just think how you can re-act to price movements that will improve your reward or decrease your risk.
The price you pay for this "convexity" is time decay. Convexity allows you to react to the market with an improvement instead of getting lucky with a "concave" position. The costs are time decay, instead of stop losses and rolls.
Some people do better with convex positions (long premium) than with concave ones (short premium).
I don't have all the answers. Sometimes it feels as if I do not have any.
If you are convinced that one side is more likely than the other, then you don't need both wings open ended. If nyou think a price will not last for long, you can do something else.
Also as time passes and new prices become reality, you are free to morph your initial position. Just think how you can re-act to price movements that will improve your reward or decrease your risk.
The price you pay for this "convexity" is time decay. Convexity allows you to react to the market with an improvement instead of getting lucky with a "concave" position. The costs are time decay, instead of stop losses and rolls.
Some people do better with convex positions (long premium) than with concave ones (short premium).
I don't have all the answers. Sometimes it feels as if I do not have any.
Howard
I find your graph a bit confusing. What is the percent gain on your account for this year, with that big loss figured in?
I find your graph a bit confusing. What is the percent gain on your account for this year, with that big loss figured in?
Each bar represents the change from the balance at the end of the previous month on the account devoted to this strategy.
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