Impossible To Reliably Make 80%+ Per Year By Selling Puts or by Trading Option Credit Spreads?

ET180 said:
With portfolio margin, you certainly can. My portfolio has a positive delta bias so I short far out of the money calls with about 2 months to expiration (similar to Karen the Super-trader) to add negative delta. The difference is that I'm only short far out of the money SPY calls a small amount so that even if the market goes to the level where the calls go ITM, the rest of my portfolio has gained a lot to offset the loss. Of course, it's possible to earn a lot more by shorting a lot more, but in that case it's not an income-producing hedge, but a leveraged bet. Bottom line, there's no free lunch unless you have information that is not public. If there was an easy and consistent way to make 80% returns year after year, the entire market would have to be relatively dumber not to realize such a method.
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“the entire market would have to be relatively dumber not to realize such a method,” I’m trying not to sound rude, but they really are.
 
zdreg said:
when Delta Force takes you out don't forget to let us know.:):)
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That would imply I’m doing something illegal, that’s incorrect.

If you ever traded institutionally, you’d understand. Trading is not what it seems.
 
"Assuming facts not in evidence..."

Just a caution, but there's a lot of this going on in this thread.
I think a lot of you guys agree much more than the posts would imply.

[cue image of "just whistling as I pass by" emoji....]
 
RichLyons said:
I'm talking about with margin, however that might be calculated. For example, $10,000 of a trader's own money, plus however much margin is needed to turn that trader's $10,000 into $18,000+ at the end of the year and so on.

Is this possible to do in today's market? I have seen at least two professional traders say that as of a year or so ago, "margin account requirements and other regulations" have made these kind of returns impossible now. What exactly does that mean (even though it seems pretty easy to understand)? Does anyone agree or disagree? Assuming that margin account requirements and other regulations weren't a factor, is it still next to impossible to make these kinds of returns with these two options trading methods (or any other methods)? Which kind of trading method is the most likely to real in these kinds of annual returns, even though they would likely be risky?

Thank you.
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Yes you can!!!


Why are you trying to teach logic to a newbie option trader and talk him out of this??

. Let them chase the rainbow and glaze knuckles over 80% returns in Disney World!

Leverage up and go for it! You are on to something new and can blow out this experienced traders with your OTM credit spread thing a mah jingy
 
The question isnt whether you can make that return, sure you can. The question is whether you can make that return consistently without taking consistently outrageous risks. The answer to that is no.
 
DeltaRisk said:
That would imply I’m doing something illegal, that’s incorrect.

If you ever traded institutionally, you’d understand. Trading is not what it seems.
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you should elaborate on your remarks.

¿would you mean institutional trading works a lot like the following?

"
As in past enforcement orders regarding traders schemes, the CFTC along with the U.S. Attorney’s office and the FBI relied on the mandatory recordings of trader chatter to prove the brazen nature of the schemes.

One trader was recorded responding to another trader’s discussion of a bid with, “For anyone. Or a spoof?” to which the other trader admits, “spoof.”

In another conversation, one trader admitted in another in a chat that he used spoofing to manipulate the market: “so glad I could help...got that up 2 bucks...that does show u how easy it is to manipulate it so[me]times.” Trader A commented further: “that was alot of clicking...i know how to ‘game’ this stuff.”

Trader A then added: “i f..k the m[ar]k[e]t around a lot...not alot of people...had it figgied out...thats [sic] why i love electronic trading.”

In another example, one of the same traders identified earlier asked another trader, “can I give you 1k plat[inum] pls ... and 5 k gold.” That trader wrote: “yep,” then asked: “i am selling both ... right?” to which Trader F responded: “yep ... spoofing it up ... ahem ahem.”

In another chat, a trader discussed precious metals trading with another trader, telling that trader: “i skewed the quote to the left ... people scared ... we[’]ll spoof it ahahaha.”

One UBS trader, for example, while discussing trading activity a trader at another bank, wrote: “hahaah”, and the other trader responded: “u [mu]st have [a]bout gazillions ... and u spoof the sell.” The UBS trader wrote: “we good ain[’]t we”, to which the other trader replied: “not very friendly.”

The UBS trader response? “we never are ... u want a fr[ien]d ... get a dog ... ahahahah.”

In another example, one UBS trader discussed trading activity with another UBS trader, writing, “u gotta be quick with spoofs cause everyone else knows the trick too ... except for smaller shops ... and a/gos of course.”
"


https://www.marketwatch.com/story/s...-and-hsbc-relied-on-trader-chatter-2018-01-29
 
rtw said:
you should elaborate on your remarks.

¿would you mean institutional trading works a lot like the following?

"
As in past enforcement orders regarding traders schemes, the CFTC along with the U.S. Attorney’s office and the FBI relied on the mandatory recordings of trader chatter to prove the brazen nature of the schemes.

One trader was recorded responding to another trader’s discussion of a bid with, “For anyone. Or a spoof?” to which the other trader admits, “spoof.”

In another conversation, one trader admitted in another in a chat that he used spoofing to manipulate the market: “so glad I could help...got that up 2 bucks...that does show u how easy it is to manipulate it so[me]times.” Trader A commented further: “that was alot of clicking...i know how to ‘game’ this stuff.”

Trader A then added: “i f..k the m[ar]k[e]t around a lot...not alot of people...had it figgied out...thats [sic] why i love electronic trading.”

In another example, one of the same traders identified earlier asked another trader, “can I give you 1k plat[inum] pls ... and 5 k gold.” That trader wrote: “yep,” then asked: “i am selling both ... right?” to which Trader F responded: “yep ... spoofing it up ... ahem ahem.”

In another chat, a trader discussed precious metals trading with another trader, telling that trader: “i skewed the quote to the left ... people scared ... we[’]ll spoof it ahahaha.”

One UBS trader, for example, while discussing trading activity a trader at another bank, wrote: “hahaah”, and the other trader responded: “u [mu]st have [a]bout gazillions ... and u spoof the sell.” The UBS trader wrote: “we good ain[’]t we”, to which the other trader replied: “not very friendly.”

The UBS trader response? “we never are ... u want a fr[ien]d ... get a dog ... ahahahah.”

In another example, one UBS trader discussed trading activity with another UBS trader, writing, “u gotta be quick with spoofs cause everyone else knows the trick too ... except for smaller shops ... and a/gos of course.”
"


https://www.marketwatch.com/story/s...-and-hsbc-relied-on-trader-chatter-2018-01-29
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Not exactly, that is illegal.

Traders get access to tons of information, and they sometimes share ideas to form companies in which they protect that proprietary information and it is never disclosed in public.
 
DeltaRisk said:
Not exactly, that is illegal.

Traders get access to tons of information, and they sometimes share ideas to form companies in which they protect that proprietary information and it is never disclosed in public.
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well, destroying the stops of all retail traders, one by one, is indeed legal up to now. i get the impression that this is what causes price movement practically all the time, that and stupid central banks doing their crap.

i could bet that the electronic communications of traders working for very large institutions read like the quotes i posted all the time, mocking all the retail traders they routinely destroy.


the situation you mention; profiting privately from privileged information must also be rampant, but i'm not aware of very many cases ever making it to the news. ¿do you have any examples to expand on your comments?
 
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