Quick Trade - Options Buying Methodology

Quote from OddTrader:

http://www.elitetrader.com/vb/showthread.php?s=&threadid=79684&highlight=*correlat*



In order to provide the best desired correlation against the Equity Hedging system ( http://www.elitetrader.com/vb/showthread.php?s=&threadid=233773 ), I have now decided All the trades of this Quick Trade system are limited to buying Long Calls options only.

That means the Equity Hedging system trades only Puts options (every week; week after week), and the Quick Trade system trades only Calls options (occassionally; high-probability expectancy).
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It appears combining these two systems could most likely provide a set of better performance characteristics.

Hence a logical development is simply to focus on the Equity Hedging overlay strategy being the main system, while integrating/maintaining the Quick Trade strategy as a sub-system.
 
Model Account Status
Started $100,000
Buy Power $100,159
Cash $100,159
Equity $0
Cumulative $ $159
Total System Equity $100,159
Margined $0
Open P/L $0


All Statistics Based on Hypothetical Results
Trades 3
# Profitable 2 (66.7%)
Avg trade duration 8.4 days
Annual return (compounded) 1.0%
Average win $120
Average loss $82
Profit factor 2.9:1
Max peak-to-valley drawdown (historical) 0.19%
drawdown period Jan 18, 2012 to Jan 26, 2012
Correlation w/ S&P 0.073
Sharpe ratio -0.035
 
Quote from atticus:

Blown up yet?
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Quote from OddTrader:

Model Account Status
Started $100,000
Buy Power $100,159
Cash $100,159
Equity $0
Cumulative $ $159
Total System Equity $100,159
Margined $0
Open P/L $0


All Statistics Based on Hypothetical Results
Trades 3
# Profitable 2 (66.7%)
Avg trade duration 8.4 days
Annual return (compounded) 1.0%
Average win $120
Average loss $82
Profit factor 2.9:1
Max peak-to-valley drawdown (historical) 0.19%
drawdown period Jan 18, 2012 to Jan 26, 2012
Correlation w/ S&P 0.073
Sharpe ratio -0.035
More...

It's hilarious. We go from talking about a money losing newsletter by Bernie Schaffer to a 3 trade c2 pitch that also doesn't make money.

HaHa.
 
This Quick Trade system is now becoming a part of the overall Equity Hedging strategy.

The Equity Hedging main system alone (before adding the Quick Trade sub-system) due to its hedging objective/functionality is never expected to make any profits.

Adding/integrating the Quick Trade system to be part of the hedging strategy can only reduce the total cost of the overall Equity Hedging strategy in order to make the hedging functionality cheaper. Otherwise, it may not be economically viable at all.
 
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