How is your DOTM Puts doing?
Part Time To Professional - What's the secret?
- Thread starter ScottCarsonMVP
- Start date
Haha Not tooo great at the moment, it's coming tho... The Biggest recession we have ever seen! Either Snaps with No Deal Brexit if it happens, or China Small/Mid Banks Wave of Defaults that's been happening combined with Currency Outflow, Minsky Moment
Normally Banks in the world give out loans based on deposits and bank's equities... In China, majority of Banks lent out since 2011 extremely high amounts of Capital to bs construction projects that built entire ghost towns or failing companies that operated on a small loss margin. The banks in China have very little equities, and since 2018 waves of defaults have been happening, since end 2018 there economy stopped turning. They QE 5 % of GDP in January, but have been on perma QE since 2011, and now have to inject hundreds of billions US a month into banks or it all collapses, and it's literally months away at full blown collapse
There Small/Mid Banks loan money themselves from big 4 Chinese Banks or conned locals into these LGFV with higher interests then Deposits and " Guaranteed " them, then turn around, loan it at higher interest to failing projects... They don't have the money, nobody has the money, it's all Central Bank Printing. It's almost like half of China's companies operate at a loss and desperately need non stop loan injections to continue Ponzi, running to stand still. Latest Stimulus in US lasted 2 Quarters Only. In China at the moment, there massive 5 % GDP print in one month will last them to April at best... Music stops, the bowls over
Seriously, you should not put all your eggs in one basket.
Remember, the market can stay irrational longer than you can stay solvent.
Kovner, a hedge fund manager used to have multiple fundamental scenarios.
Maybe two were exactly the same but one occurring 2 years later.
He would trade the one presently unfolding and shelve the other(s).
It can take forever for a market to care about and begin to discount a scenario.
Sometimes markets de sensitize to seemingly same events.
Recall years ago that a suspected .1% China GDP shortfall would selloff US markets(to a Greater degree)
Cans can be kicked to preserve stability. All measures will be used to avoid recessions and crisis. Dont fade a central bank....especially now they act in concert globally.
On the other hand.......maybe you are right about the narrative you are trading but the size man is the issue....Adjust, throw a few bucks at this, sit back, relax and enjoy. Just my/nobody's opinion.
Of course I did not know Bruce Kovner or any other trader personally...But, I did stay at a Holiday Inn Express last night.
Maybe two were exactly the same but one occurring 2 years later.
He would trade the one presently unfolding and shelve the other(s).
It can take forever for a market to care about and begin to discount a scenario.
Sometimes markets de sensitize to seemingly same events.
Recall years ago that a suspected .1% China GDP shortfall would selloff US markets(to a Greater degree)
Cans can be kicked to preserve stability. All measures will be used to avoid recessions and crisis. Dont fade a central bank....especially now they act in concert globally.
On the other hand.......maybe you are right about the narrative you are trading but the size man is the issue....Adjust, throw a few bucks at this, sit back, relax and enjoy. Just my/nobody's opinion.
Of course I did not know Bruce Kovner or any other trader personally...But, I did stay at a Holiday Inn Express last night.
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Seriously, you should not put all your eggs in one basket.
Remember, the market can stay irrational longer than you can stay solvent.
I am closing a nice sized position likely in end March, it expires April 19 on a Mortgage Company... I will very likely blast it in HYG as well, already have a big bet on it. I have back ups shorts but in all the thesis I did and research, Industrial Junk Bonds have highest profit potential... Live by Options, Die by Options
I understand what you mean tho, I gotta live with decision and outcome, it's just too big of an opportunity to pass, no way the shit doesn't go down in 2019
Be honest to yourself. Have you consistently traded with returns above 15% for over 5 years or more? Do have 1/4 million equity to put at risk. Your mortgage free, plus no debt. Do the math. Welcome to the wild side, you're now living off trading proceeds. Your consistent return will net you just under 40k annually. With margin your return will be higher, also your risk. Your draw down could be 30% on capital, ouch. See what happened 2018 last quarter.