options . . . very hard to make money

Quote from trefoil:

Don't get too bitter. This thread was actually worth something, in that yours truly, even after my son said "Duration!" didn't actually connect the dots between dv01 and what gets done in options.
It's an interesting thought. Whether it leads to an improved p/l, who knows, but at least it's something worthy of investigation.
As for the boastfulness of 66 and atticus, leave them. Either they're successful, in which case they can boast all they want, or they're not, but then we'd never know that anyway, right?
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Could you share what you understood and learned, explained in you own words?

The comment was about (part of) a post. I did not read the whole thread, and therefore cannot say about its worth. What others make or lose in trading is of no consequence on me, because it does not take from me and it does not help me either. It is wash in terms of impact on me, but I prefer to hear that someone is making it rather than losing it, although I know that if someone is making it means others are losing it.
 
Quote from tradingjournals:

Could you share what you understood and learned, explained in you own words?

The comment was about (part of) a post. I did not read the whole thread, and therefore cannot say about its worth. What others make or lose in trading is of no consequence on me, because it does not take from me and it does not help me either. It is wash in terms of impact on me, but I prefer hearing someone making it rather than losing it, although I know that if someone is making it means others are losing it.
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my last sentence imo is a main part of getting to a profitable trader. luck helps too.

i will add something that i did not in the thread.

i found success by trading only one product.

i don't trade euro then tap cl, etc. i do not own anything but cash in my account's and study my product and edge constantly.

i get draw downs too, i may post in p/l thread and will be sure if i do to post the losers too.
 
Quote from tradingjournals:

Could you share what you understood and learned, explained in you own words?

The comment was about (part of) a post. I did not read the whole thread, and therefore cannot say about its worth. What others make or lose in trading is of no consequence on me, because it does not take from me and it does not help me either. It is wash in terms of impact on me, but I prefer to hear that someone is making it rather than losing it, although I know that if someone is making it means others are losing it.
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I posted it earlier, but will repeat: I actually said to someone in real life somewhere along the way that both interest and theta on a (sold) option are ways of making money off of time.
Given that, dv01 should apply to options as well as bonds. The idea posted earlier, of dv01 being related to the VIX, might actually have some legitimacy here, as options are partially priced on volatility, so in a way vega is dv01 for options, but also there might be some other uses related to theta as well.
Not a well-formed thought yet. My son is more of the math whiz in my family, so I'm going to have to bounce the idea off of him and see what he thinks. Seems interesting.
 
Quote from trefoil:

I posted it earlier, but will repeat: I actually said to someone in real life somewhere along the way that both interest and theta on a (sold) option are ways of making money off of time.
Given that, dv01 should apply to options as well as bonds. The idea posted earlier, of dv01 being related to the VIX, might actually have some legitimacy here, as options are partially priced on volatility, so in a way vega is dv01 for options, but also there might be some other uses related to theta as well.
Not a well-formed thought yet. My son is more of the math whiz in my family, so I'm going to have to bounce the idea off of him and see what he thinks. Seems interesting.
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in my intraday trading i use my version of dv01. you have to be glued to screen though.
 
DV01 doesn't make any sense in reference to equity, index, or volatility derivatives. I suppose that is the inside joke that atticus and SIV66 are trying to push on the ET crowd though.
 
Quote from froluis:

what is the difference between dv01 and delta?
thanks
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They're used interchangeably in the world of rates sometimes. DV01 is normally used to refer to the sensitivity of a position to a 1 basis point parallel shift of the yield curve. Thus units of DV01 are $/bp. Delta, on the other hand, is the sensitivity of a position to a move in the underlying, whatever that might be, and is measured in %, normally. My Z$2c.
 
Quote from sellindexvol66:


and for those dopes who think i sell puts , etc.. note in my p/l posting i made nearly 100k in a month that had 3 weeks of selling off. :D
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I'm picking up what you're putting down...so you're saying you sell calls:p
 
From a rates trading perspective for example, say the DV01 of 100m usd 2y rate swap is $19,500 (i.e. the risk of the exposure to a 1bp move), then in eurodollar futures terms, the 'delta' will be 19,500/25 (tick or bp value being $25) = 780 = 780 futs contract equivalent hedge... If you're receiving the 2yrs, can either describe risk as a 19,500 01, or long 780 delta - so yes they are simply different terms to describe the same thing (in the rates market - for the sake of simplicity assuming curve risks in front/red futures packs are equivalent to 2y point on curve etc...)
 
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