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cesfx said:
Thanks Mr, I also appreciate your clear contribution. It's getting me to think. I will the read Passarelli book.
I have a question on maintaining neutrality in practice.
If I sell premium and want to stay as neutral as possible, what would be a valid method of adjustment? An X deviation of delta or gamma to be adjusted with shares or option depending on what's needed, or a time (daily, weekly, monthly) adjustment toward neutral? Or both?
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It depends on what you want to achieve. If you arb skew, then of course you would want to hedge with the option on the other side of spot (you sold a otm call so you want to buy an OTM put) and hedge delta with shares.
OTM vs ATM you oviously also want to hedge with options.

IV vs. stat vol you buy nuke protection and use shares.

When it comes to risk, you want to establish min/max for each greek and try to stay within that greek regardless of time.
 
.sigma said:
im actually collecting an epistolary of random butterfly quotes from books, articles, posts, material pertaining to flies, it’s extensive.. a probably the best overall “book” about flies. But I’m not done, maybe when I am I’ll send you a copy.

also, what’s a butterfly trader? Do you mean a trader who uses butterflies?

Unfortunately there’s no single book that covers strictly flies, except one. Which is “The Bullshit Free Guide To Trading Butterflies” by Gavin McMaster. This author has published numerous books with the same type of title (not a fan of the title) on different topics.

it’s a pretty good “book” but it’s pretty vague. Although it goes a bit deeper than most option books that usually explain a spread for 4 pages then move on. The book I mentioned earlier Passerli’s has a section on flies which is pretty good. I’ll add more later
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Maybe a few of us should go together and author a book specifically on the butterfly as few if any actually exist. An entertaining Spring / Summer project.
 
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I was a creditspread seller (1 trick pony), but last year I realised that it has become more difficult for me to be consistently profitable. In these markets, you have to be able to adjust.

So which books talks about adjusting positions in detail (how /when / why ) besides the Charles Cottle book?
 
Eikfe said:
I was a creditspread seller (1 trick pony), but last year I realised that it has become more difficult for me to be consistently profitable. In these markets, you have to be able to adjust.

So which books talks about adjusting positions in detail (how /when / why ) besides the Charles Cottle book?
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Why "besides the Charles Cottle book" ?
 
jamesbp said:
Why "besides the Charles Cottle book" ?
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His book is tough. I'm gonna read it for the 3rd time, but chapter 1 is very hard to understand.
I do have to say that everytime I read it, i get a new understanding.
 
Eikfe said:
His book is tough. I'm gonna read it for the 3rd time, but chapter 1 is very hard to understand.
I do have to say that everytime I read it, i get a new understanding.
More...

Trading is a tough game though ... there is no 'easy way' to learn
... although plenty will try and sell you a 'Triple-income-wheel' strategy that appeals to the naive

I seem to remember Cottle introduces his book as starting where others have finished
 
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