I am really not sure what obvious things I am not understanding, but be that as it may...
Best of luck to you regardless!
Making Money is Easy
- Thread starter frostengine
- Start date
Best of luck to you regardless!
"Its based on what I perceive as a systemic miss-pricing of options."
There is no such thing. Someone with a PhD a few years ago used an option strategy, equity was straight up for three years and then lost it all in a few months.
There is no such thing. Someone with a PhD a few years ago used an option strategy, equity was straight up for three years and then lost it all in a few months.
Puzzling, isn't it? Three extremely simple mean reversion strategies that have made tons of money but traders in ET and elsewhere complain that markets are rigged, trading is hard, etc. I think losing money in trading is due to an attitude problem only. I agree, trading is simple.
Based on your info, here is my opinion based on being the markets for 20 years:
1) If you are making 2% every week with a 200K account, that is about $4,000 a week, shut up and keep doing exactly what you are doing until it doesn't work anymore
2) Five profitable trades can be accomplished by any trader, the question is will what you are doing be successful for a full year? And even if you don't make money every week, will it work enough to give you a substantial profit?
3) Markets change constantly, what works now may stop working tomorrow. Sounds like you found something, milk it dry
4) I would not ever think that any strategy is "easy money" and then quadruple your position next Friday because THAT is when the market will change for whatever reason and you will get crushed
1) If you are making 2% every week with a 200K account, that is about $4,000 a week, shut up and keep doing exactly what you are doing until it doesn't work anymore
2) Five profitable trades can be accomplished by any trader, the question is will what you are doing be successful for a full year? And even if you don't make money every week, will it work enough to give you a substantial profit?
3) Markets change constantly, what works now may stop working tomorrow. Sounds like you found something, milk it dry
4) I would not ever think that any strategy is "easy money" and then quadruple your position next Friday because THAT is when the market will change for whatever reason and you will get crushed
Frost,
What is your risk? Can you tell me what your loss is if the market goes 5%-10%-20% against you overnight, or while the position is open? Or if vol jumps 10%-30% etc. if you are doing calendars?
To me this is the primary concern, not if/when the strat might stop working. If you are levered up the yingyang to make that 2%/week, then the strategy is not long term viable imho.
Good luck with your trading.
What is your risk? Can you tell me what your loss is if the market goes 5%-10%-20% against you overnight, or while the position is open? Or if vol jumps 10%-30% etc. if you are doing calendars?
To me this is the primary concern, not if/when the strat might stop working. If you are levered up the yingyang to make that 2%/week, then the strategy is not long term viable imho.
Good luck with your trading.
Sergio77...I have to wonder how DIFFICULT it was for these strategies to be created/discovered or if they were generated easily. If they do indeed work...some of the hard part was taken out already...somebody came up with them for all of us to enjoy. Discipline is very easy for me, therefore I believe I could follow these strategies...provided they work. Problem is, I've known most people to not have the same degree of discipline that I've always displayed...therefore I believe that too many people couldn't follow these formulas well enough to benefit. I've seen so many right brained people stuck in the clouds or too reactive in the moment to have the necessary stability to follow through...so many of these people can't help themselves do to innate wiring. I don't think it's always an attitude problem...in my opinion. It sounds simple for you...though. Just sharing.
Some good points. Here is another article from the same blog that lists some of the reasons with basic being analysis by paralysis. In my opinion the author is one of the most honest and knowledgeable traders in the business.