HowardCohodas Index Options Credit Spread Trading Journal

[atticus]

Here's something for the credit spreaders and the Manna that is POT. Assume deltas are the prob of exp and double it for touch probability. If the delta is 30-per then the exp prob is 30% and the touch is 60%. You'll be within 100bps of "reality" and you can put the colorful excel sheets in the trash. It's no less reliable in practice that using MC, CRR or BSM. They're all going to converge anyway.

Why is it that you estimate POT but never acknowledge the possible loss? Why not at least begin with what you know with absolute certainty (max loss)? I don't see a column for that.

 

[HowardCohodas]

The vitriol is expected. The ignorance displayed in the recent posts is appalling. Constructive criticism of my methods is acceptable and in the fine tradition of the Socratic method. If the criticism is to be taken seriously by me or the readers, it should at least be based on stuff that is not patently false.

The vitriol displayed in many of the recent posts doesn't bother me. I've developed many things in my career where I endured the same and came out OK. Got a patent related to using GPS. Discovered a way to provide internet GIF files that did not violate the Unisys patent. Unisys come to me to plead with me to get a deeply discounted license so as not to jeopardize their profitable license business. Sold my software all over the world. I could go on.

Have I done it again? I don't presume to think so without more real money trading and detailed analysis. People with high level degrees in economics and mathematics believe there is some merit in what I am doing. But being continuously profitable, even over the recent increase in volatility reinforces my confidence in my strategy. Will it continue to work? We'll see.

 

[Maverick74]

Quote from HowardCohodas:

The vitriol is expected. The ignorance displayed in the recent posts is appalling. Constructive criticism of my methods is acceptable and in the fine tradition of the Socratic method. If the criticism is to be taken seriously by me or the readers, it should at least be based on stuff that is not patently false.

The vitriol displayed in many of the recent posts doesn't bother me. I've developed many things in my career where I endured the same and came out OK. Got a patent related to using GPS. Discovered a way to provide internet GIF files that did not violate the Unisys patent. Unisys come to me to plead with me to get a deeply discounted license so as not to jeopardize their profitable license business. Sold my software all over the world. I could go on.

Have I done it again? I don't presume to think so without more real money trading and detailed analysis. People with high level degrees in economics and mathematics believe there is some merit in what I am doing. But being continuously profitable, even over the recent increase in volatility reinforces my confidence in my strategy. Will it continue to work? We'll see.

I have no comment on your strategy. It's been discussed ad nauseum on these forums for years. But why are you violating ET's advertising policy?

 

[atticus]

Quote from HowardCohodas:

The vitriol is expected. The ignorance displayed in the recent posts is appalling. Constructive criticism of my methods is acceptable and in the fine tradition of the Socratic method. If the criticism is to be taken seriously by me or the readers, it should at least be based on stuff that is not patently false.

The vitriol displayed in many of the recent posts doesn't bother me. I've developed many things in my career where I endured the same and came out OK. Got a patent related to using GPS. Discovered a way to provide internet GIF files that did not violate the Unisys patent. Unisys come to me to plead with me to get a deeply discounted license so as not to jeopardize their profitable license business. Sold my software all over the world. I could go on.

Have I done it again? I don't presume to think so without more real money trading and detailed analysis. People with high level degrees in economics and mathematics believe there is some merit in what I am doing. But being continuously profitable, even over the recent increase in volatility reinforces my confidence in my strategy. Will it continue to work? We'll see.

What, specifically, is patently false?

Please be so kind as to name one person with a (sic) high level degree in econ or maths that thinks what you're doing has some merit. I mean, someone who thinks risking $45 to make $5.

You're comparing some BS .gif patent protection to something that pre-dates BSM?

 

[HowardCohodas]

Quote from Maverick74:

I have no comment on your strategy. It's been discussed ad nauseum on these forums for years. But why are you violating ET's advertising policy?

I don't see how the interview violates the advertising policy. I did not mention anything about selling anything in the interview.

I am not yet teaching anyone for money. I have taught family and friends for free. I have stated this before. At the moment, all I offer is FREE stuff.

Should I "go commercial" I am, in fact, interested in advertising with EliteTrader. Not only is this forum mostly made up of good people, but it needs to be supported in order for continue to provide the free service to the posters.

 

[HowardCohodas]

Quote from atticus:

What, specifically, is patently false?

Please be so kind as to name one person with a (sic) high level degree in econ or maths that thinks what you're doing has some merit. I mean, someone who thinks risking $45 to make $5.

You're comparing some BS .gif patent protection to something that pre-dates BSM?

A perfect example of an ignorant statement showing no understanding of what I practice.

 

[atticus]

Quote from HowardCohodas:

The vitriol is expected. The ignorance displayed in the recent posts is appalling. Constructive criticism of my methods is acceptable and in the fine tradition of the Socratic method. If the criticism is to be taken seriously by me or the readers, it should at least be based on stuff that is not patently false.

The vitriol displayed in many of the recent posts doesn't bother me. I've developed many things in my career where I endured the same and came out OK. Got a patent related to using GPS. Discovered a way to provide internet GIF files that did not violate the Unisys patent. Unisys come to me to plead with me to get a deeply discounted license so as not to jeopardize their profitable license business. Sold my software all over the world. I could go on.

Have I done it again? I don't presume to think so without more real money trading and detailed analysis. People with high level degrees in economics and mathematics believe there is some merit in what I am doing. But being continuously profitable, even over the recent increase in volatility reinforces my confidence in my strategy. Will it continue to work? We'll see.

I wouldn't know where to start. Words cannot describe the awesomeness.

 

[Maverick74]

Quote from HowardCohodas:

I don't see how the interview violates the advertising policy. I did not mention anything about selling anything in the interview.

I am not yet teaching anyone for money. I have taught family and friends for free. I have stated this before. At the moment, all I offer is FREE stuff.

Should I "go commercial" I am, in fact, interested in advertising with EliteTrader. Not only is this forum mostly made up of good people, but it needs to be supported in order for continue to provide the free service to the posters.

Welcome to the future home of our blog and trading journal. Here you will also find links to our education, training and coaching services. Book, articles, Howard's Trading® Checklists.
Sign up to be notified when our free and paid services go live.

That is advertising. You are directing people to what is going to be a commercial site as you state above. This violates ET's advertising policy.

 

[sellindexvol66]

Quote from HowardCohodas:

The vitriol is expected. The ignorance displayed in the recent posts is appalling. Constructive criticism of my methods is acceptable and in the fine tradition of the Socratic method. If the criticism is to be taken seriously by me or the readers, it should at least be based on stuff that is not patently false.

The vitriol displayed in many of the recent posts doesn't bother me. I've developed many things in my career where I endured the same and came out OK. Got a patent related to using GPS. Discovered a way to provide internet GIF files that did not violate the Unisys patent. Unisys come to me to plead with me to get a deeply discounted license so as not to jeopardize their profitable license business. Sold my software all over the world. I could go on.

Have I done it again? I don't presume to think so without more real money trading and detailed analysis. People with high level degrees in economics and mathematics believe there is some merit in what I am doing. But being continuously profitable, even over the recent increase in volatility reinforces my confidence in my strategy. Will it continue to work? We'll see.

howard, i'm no fan of oc or atticus but nothing they said was patently false; in fact their points are understatements. i did my share of credit spreads in 08 taking decent sized losses. there is ZERO you can do to protect, hedge, etc on a volplosion or sudden move through short strikes. you will lose exponentially. unless you consider these points you will just be the next guy to learn the hard way. in any case, PT Barnum was right on the money. suffice to say i have not touched a spread like yours since november 2008, lol.

 

[HowardCohodas]

Quote from atticus:

I wouldn't know where to start. Words cannot describe the awesomeness.

A good place to start would be to read, understand and try asking a question without an ignorant and/or false premise.