Yeah, I know that. Not the same thing. (At one point in my career I had custody of OPM... and I never stole or misappropriated even $.05 from any client. Madoff was a fraud and a crook.)
Options Noob... 1st 100 trades completed
- Thread starter Scataphagos
- Start date
Yeah, I know that. Not the same thing. (At one point in my career I had custody of OPM... and I never stole or misappropriated even $.05 from any client. Madoff was a fraud and a crook.)
I completely understand what Scataphagos is asking. He will clearly make his own decision as to where to place his money, but he's just looking for a service that would do some filtering for him. Its no different than using a charting program to make a nice price chart for you from the streaming quotes it receives, rather than having to make your own chart by hand from many decades ago. (yes, I was shocked to read that this is how people used to do it)
Years ago some did charts "by hand". It was worth the hassle of doing so because they knew the value. Anyone who didn't do such charting was at a disadvantage.
Today real-time charts are available to all. And they are just as valuable today as before we had computers. But because "everybody has the info", you have to be able to size-up the situation and make the trade quickly to be ahead of the herd.
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It's tongue-in-cheek. You're trying to fix something that isn't broken. You seem to have a good trading strategy and it doesn't look to translate well to options trading.
You have at least a cursory understanding of where and how much money can be made in options, and the conclusions you have drawn are all correct to the extent that you trade price moves. There are definitely profitable long strategies for options, but that is weekly / monthly price moves, or picking up pennies.
I don't know if any are worth it. I pick my own. I have a shallow stable of symbols, and a clearly defined strategy. So, I just scan the charts till I see my (daily) signals or confirmation and the look at the chains for good trades. I've looked at them enough that I see the "greeks" through with just the BxA (well, not the greeks per se, but the functional equivalent). In a normal week, it will take me about 3-4 hours of work to find my positions, and another 2-4 hours to manage them while open.
So, relatively little effort to "screen" for me. But that's also 10+ years of working in insurance (which is conceptually very similar)--and that part of insurance that most directly correlates with options pricing. Add in another 5+ years of trading with an options focus...I think you're going through a pretty normal 'growing pains' stage of options. I had been trading them for years before I could parse the chains at any reasonable speed. I look back now and I'm absolutely amazed at how little I lost given how little I knew. Steep learning curve for sure.
Yeah... so far, I'm thinking it's likely "not worth it". There is always risk with any approach to the markets, of course. But so far I'm thinking options are more hassle then they're worth. (Then again, perhaps I'm just too lazy.)
Trading the ES seems on a par with risk-reward of options, but waaayyy less hassle.
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Here's why they're so difficult conceptually. This is time / underlying price / profit graph for a relatively simple short straddle (sliced down the middle from the "v" is similar to the inverse of a long options). Being able to envision that while looking at just the chains seemed to be my tipping point. Once you've mastered this one, try to visualize a calendar spread!
Honestly, were it not for me being conceptually strong in 3D calculus anyway, and having years of experience with insurance to condition my brain for price, I'd agree 100% that it's not worth the time or effort.
Honestly, were it not for me being conceptually strong in 3D calculus anyway, and having years of experience with insurance to condition my brain for price, I'd agree 100% that it's not worth the time or effort.
To trade options, you have to be right, and right now -- if you can't do that...then just collect the small premium for the longer haul, 
which is generally safer,
Options are like a ticking timebomb. it's more fun/explosive (or potentially much more profitable)...the shorter it is to expiration,
As for all those greeks and formulas and computer models...forget about those, it's kind of irrelevant.
KISS: keep it simple, stupid
which is generally safer,Options are like a ticking timebomb. it's more fun/explosive (or potentially much more profitable)...the shorter it is to expiration,
As for all those greeks and formulas and computer models...forget about those, it's kind of irrelevant.
KISS: keep it simple, stupid
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Buyers of options rarely make money, but I'm extremely thankful they are in the pool!
I don't do options but know that there a pros that are trading options by buying (volatility) only just because everyone out there thinks that selling is the only way to go and it's really crowded out there with everyone i.e. shorting volatility.
While option sellers might make a lot of money, they are also prone to spectacular blow outs. Option selling is like trying to be an insurance company. But most forget that insurance business is a regulated industry with mandatory reserves taken from profits each year to cover big losses that will come one day. And you can be assured that they WILL come.
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Kinda thinking the same myself.