How are you using it without level 2 quotes
My option trades
- Thread starter ryanpatrick
- Start date
Kinggyppo
Your comment on the straddle hits home. It is now making some sense in understanding the GREEKS. So progress, however slowly, a little bit at a time. Yes I do tend to chew a long time, on one idea. Until I get the full flavor. I agree there. At my age, I can no longer multi-task.
While you have a sort of academic approach to understanding these things. I find I´m visualizing the same thing, but in a slightly different way. The conclusion however, is the same. The academic approach will come. albeit a little slower. Being self taught without any accessory lessons, I´m sort of refining results through different approaches.
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I´m discoursing on here, because there are a lot of amateur newbies monitor these things and since I´m not afraid of being ridiculed, do not mind the occasional slants and barbs that come my way. It might help some of them? I think in the past two years, it was one of my disappointments that contributors didn´t contribute more, with helpful in depth meaningful explanations. We seem to be doing that here and now?
I have been kind of thinking over an observation of Forex Forex in which he said I was tending to buy tops and not bottoms. Today and last night I´ve been thinking about it. He is right. There comes a period in which there is a narrow congestion area, leading up to a breakout. The movements are not enough profit to take and reverse quickly. At least in my chosen time frame? Last week was an example in which I got whipsawed twice. Taking losses three times in all.
I´ve been thinking about it and realize now that if I look at patterns in several higher time frames, I could more predict the likelihood of the eventual breakout. What was disconcerting is to actually see other people by the price action, doing that predicting and acting on it, when myself I was confused and uncertain.
I think I have that pegged now, thanks to that observation of Forex Forex and next week, will see if I can capitalize on it. Buy lows instead of the highs of small market flutter moves.
As an aside, I read somewhere, maybe on here, there is a trader that started out CARD COUNTING in his younger days in the blackjack pit, at casinos. I rather thought of that idea and was trying to reason out my buying lows and highs in congestion comparing to a blackjack counter. Won´t know for a couple of weeks as all testing has to be done in the real world, in the future in real time.
There are some other gambling theories, one of which, that escapes my memory right now I would like to remember. Which might fit the problem I had with whipsaws that Forex Forex pointed out. I might just peruse the internet and see if I can find something in gambling methods to jog my memory. ( grin )
In the meantime, the rest of this week is going to be spent just watching what happens to two paper trades with calendars. The first calendar ( Monday ) was to see if Time Decay would happen on time in the March Quarterlies. The second calendar I put on late this afternoon, to see what happens if I put on a calendar at the turn of trend volatility and if it is possible to catch countertrend, the volatility premium contraction and time decay together. Both involving selling near term contracts. By selling contracts in a shallow counter trend move. My thinking and reasoning about the longer out, contract you buy, I´m still thinking about. What to do with it?
Your comment on the straddle hits home. It is now making some sense in understanding the GREEKS. So progress, however slowly, a little bit at a time. Yes I do tend to chew a long time, on one idea. Until I get the full flavor. I agree there. At my age, I can no longer multi-task.
While you have a sort of academic approach to understanding these things. I find I´m visualizing the same thing, but in a slightly different way. The conclusion however, is the same. The academic approach will come. albeit a little slower. Being self taught without any accessory lessons, I´m sort of refining results through different approaches.
_____________________________
I´m discoursing on here, because there are a lot of amateur newbies monitor these things and since I´m not afraid of being ridiculed, do not mind the occasional slants and barbs that come my way. It might help some of them? I think in the past two years, it was one of my disappointments that contributors didn´t contribute more, with helpful in depth meaningful explanations. We seem to be doing that here and now?
I have been kind of thinking over an observation of Forex Forex in which he said I was tending to buy tops and not bottoms. Today and last night I´ve been thinking about it. He is right. There comes a period in which there is a narrow congestion area, leading up to a breakout. The movements are not enough profit to take and reverse quickly. At least in my chosen time frame? Last week was an example in which I got whipsawed twice. Taking losses three times in all.
I´ve been thinking about it and realize now that if I look at patterns in several higher time frames, I could more predict the likelihood of the eventual breakout. What was disconcerting is to actually see other people by the price action, doing that predicting and acting on it, when myself I was confused and uncertain.
I think I have that pegged now, thanks to that observation of Forex Forex and next week, will see if I can capitalize on it. Buy lows instead of the highs of small market flutter moves.
As an aside, I read somewhere, maybe on here, there is a trader that started out CARD COUNTING in his younger days in the blackjack pit, at casinos. I rather thought of that idea and was trying to reason out my buying lows and highs in congestion comparing to a blackjack counter. Won´t know for a couple of weeks as all testing has to be done in the real world, in the future in real time.
There are some other gambling theories, one of which, that escapes my memory right now I would like to remember. Which might fit the problem I had with whipsaws that Forex Forex pointed out. I might just peruse the internet and see if I can find something in gambling methods to jog my memory. ( grin )
In the meantime, the rest of this week is going to be spent just watching what happens to two paper trades with calendars. The first calendar ( Monday ) was to see if Time Decay would happen on time in the March Quarterlies. The second calendar I put on late this afternoon, to see what happens if I put on a calendar at the turn of trend volatility and if it is possible to catch countertrend, the volatility premium contraction and time decay together. Both involving selling near term contracts. By selling contracts in a shallow counter trend move. My thinking and reasoning about the longer out, contract you buy, I´m still thinking about. What to do with it?
Here is a quick primer on basic synthetics for the lurkers.
http://blog.sheridanmentoring.com/t...rybody-ought-to-know-about-option-synthetics/
http://blog.sheridanmentoring.com/t...rybody-ought-to-know-about-option-synthetics/
Geez, that's one of the longest explanations, including the algebra, I've ever seen. Thanks for posting it however, it does seem to fill a void in the training that we're trying to do here.
I just say long call + short put = 100 delta stock position long.
Short Call + Long put = 100 delta stock position short.
Take the first one and short the Underlying = reverse conversion.
Take the second one and buy the underlying = conversion.
All conversions and reversals "must" trade within pennies of Fair Value based on interest rates and days until expiry (+ or - dividend).
Hmm? Now that I type out this simple concept, looks just about as bad as yours, LOL.
Don
Quote from Don Bright:
Geez, that's one of the longest explanations, including the algebra, I've ever seen. Thanks for posting it however, it does seem to fill a void in the training that we're trying to do here.
I just say long call + short put = 100 delta stock position long.
Short Call + Long put = 100 delta stock position short.
Take the first one and short the Underlying = reverse conversion.
Take the second one and buy the underlying = conversion.
All conversions and reversals "must" trade within pennies of Fair Value based on interest rates and days until expiry (+ or - dividend).
Hmm? Now that I type out this simple concept, looks just about as bad as yours, LOL.
Don
u = c - p
Here's the thing Don, retail traders who never worked at an exchange don't have any reason to understand what you are talking about. Know any new option trades that are doing coversions/reversals, LOL. Its more a bet it all on black or the guy whose first trade is an iron condor. Personally I think there should be more emphasis on the basics like delta, theta and basic strategies.
So where is RYAN the host of this talk show these days?
Whats your equity balance today Ryan? ( grin )
Whats your equity balance today Ryan? ( grin )
I started off here with that exact thing, and have attempted to show the simplicity of options trading. As I just said in another thread (paraphrase) "Options Trading is as simple as you'll let it, or as difficult as you want to make it." The MM's are pro's and won't let anyone get away with any sure things or locks. I don't recall them ever giving away any money, LOL. Again, that's why we prefer equities for our traders, much more level playing field. We still hold CME membership et al, but equities are just easier IMO.
All the best,
Don