I told you BS was BS!

PPC said:
Many years ago I was studying Taleb’s Dynamic Hedging, and I admit that most of it was way over my head, and I realised that there are much easier ways to make money in options, and I decided to stick with more the practical Charles Cottle’s teachings of dissections and stuff like that.
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I like to know how. I do make some money, but not very easy.
 
PPC said:
@SimpleMeLike, here is the recipe

Step 1)
Borrow as much money as you can

Step 2)
Buy one way ticket to Panama (or some place where people won’t find you).

Step 3)
Buy OTMs Puts/Calls (i.e. lottery tickets)

Step 4)
If you’re a lucky and make a bundle, then repay the money you borrowed and enjoy the rest of your profits.

Step 5)
If you’re unlucky and lose everything, then fly away to Panama and never return, and start the same scheme from different country (jurisdiction) over again until it works. :D:D:D
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A small modification:

Step 3)
Use half the money buy DOTM Puts/Calls

Step 5)
If you're unlucky and lose your bet, then fly away to Panama and never return but live like a king there.
 
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Make me a 100 up market in the 18-19.5-21 call fly with 10 days to expiration



wxytrader said:
Ok well here ya go...done before breakfast. The problem with current pricing models is probabilities are out of wack and therefore the prices are skewed all wrong.
  • Step 1 is get rid of IV and get rid of all the greeks. The whole system is ambiguous and not even necessary...or accurate.
  • Step 2 use ATR data. We already have all the data available, and it can easily be adjusted to the actual trend.
So here are the actual APR12 (10) CLSK prices at 8:40 am, compared to the prices generated on the spreadsheet which are based on the trend adj ATR for the last 14 days calculated for (10)

I have only dealt with OTM calls for this example. You can see the otm calls get cheaper the farther out you go relative to the actual prices, and they get more expensive the closer to itm you get.

View attachment 337389
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Wow,you are really good...

Now show us a relative mispricing and the trade you put on 100x plus...

Waiting........



wxytrader said:
Ok well here ya go...done before breakfast. The problem with current pricing models is probabilities are out of wack and therefore the prices are skewed all wrong.
  • Step 1 is get rid of IV and get rid of all the greeks. The whole system is ambiguous and not even necessary...or accurate.
  • Step 2 use ATR data. We already have all the data available, and it can easily be adjusted to the actual trend.
So here are the actual APR12 (10) CLSK prices at 8:40 am, compared to the prices generated on the spreadsheet which are based on the trend adj ATR for the last 14 days calculated for (10)

I have only dealt with OTM calls for this example. You can see the otm calls get cheaper the farther out you go relative to the actual prices, and they get more expensive the closer to itm you get.

View attachment 337389
More...
 
PPC said:
@SimpleMeLike, here is the recipe

Step 1)
Borrow as much money as you can

Step 2)
Buy one way ticket to Panama (or some place where people won’t find you).

Step 3)
Buy OTMs Puts/Calls (i.e. lottery tickets)

Step 4)
If you’re a lucky and make a bundle, then repay the money you borrowed and enjoy the rest of your profits.

Step 5)
If you’re unlucky and lose everything, then fly away to Panama and never return, and start the same scheme from different country (jurisdiction) over again until it works. :D:D:D
More...
Thank you PPC
 
taowave said:
Wow,you are really good...

Now show us a relative mispricing and the trade you put on 100x plus...

Waiting........
More...

What do you mean? I just said the probability of being itm/otm is completely skewed wrong with options..so the whole options market is mis-priced. Pick any option and it is mis-priced.
 
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