SPX Credit Spread Trader

Heatheranderson · May 31, 2006

I wont bring up kiyosaki with you again.

Just one point.He admits he is weak in options and thats why he advises from learning from a good mentor.He himself has this guy as his friend and mentor(www.wealthwiseeducation.com).

El OchoCinco · May 31, 2006

Well looks like if people listened to me, then the dip to 1245 would not have been so bad LOL..... Of course I am stil human and did the moronic 1250/1255 small position in the prop account. Must have bene thinking of JA when I did it lo...

05-03-06 10:36 AM

For JUNE I am looking at 1230 at the highest for puts and about 1380 or so on the call side if I choose to do calls. I think May will be a lot of bouncing around so if I can get in MAY in a the next week or so, I can maybe get out in the beginning of June.

We will see..

ryank · May 31, 2006

Quote from rallymode:

but coach, you have to agree with me that if your may position had expired when the SPX was at around 1325(and selloff was delayed by 10 days), you would've opened up the put side with a short at around 1240 or so for JUNE and many here wou;d've done the same. Now we all know how that would've worked out with the magnitude of the selloff and vix spike.

I was one of those June 1230/1240 put people. This was the first time I have been burnt since October/November of last year I think (this time was more painful). Even before this month I was looking at the close to the money 5 point spreads, now I am becoming more of a believer. I will still do some FOTM spreads but I will do the closer spreads as well.

Rally, in another post you mention shooting for 10%-30%, I assume you mean on an annual basis or are you holding the "Holy Grail" trading strategy from us lol

.

Cache Landing · May 31, 2006

Quote from ryank:

I was one of those June 1230/1240 put people. This was the first time I have been burnt since October/November of last year I think (this time was more painful). Even before this month I was looking at the close to the money 5 point spreads, now I am becoming more of a believer. I will still do some FOTM spreads but I will do the closer spreads as well.

Rally, in another post you mention shooting for 10%-30%, I assume you mean on an annual basis or are you holding the "Holy Grail" trading strategy from us lol .

I had the 1235/1245 and came out of it really well. I'm a bit disappointed that the MMs weren't working with me on "legging out" of the b-flies right before yesterday's drop though.

Rally, it seems you and I are similar in yet another aspect of trading. We have very similar monthly targets.

Cache Landing · May 31, 2006

Quote from ryank:

I was one of those June 1230/1240 put people. This was the first time I have been burnt since October/November of last year I think (this time was more painful). Even before this month I was looking at the close to the money 5 point spreads, now I am becoming more of a believer. I will still do some FOTM spreads but I will do the closer spreads as well.

Rally, in another post you mention shooting for 10%-30%, I assume you mean on an annual basis or are you holding the "Holy Grail" trading strategy from us lol .

Any schmoe that follows this thread can do better than 10% annually. Given the placement of his spreads I would assume he is talking about at least 10%/month.

El OchoCinco · May 31, 2006

Lame picture alert!

http://www.tradersexpo.com/tradersexpo/florida/spkrschedule.asp?Range=AB#

Scroll down to Budwick....

rallymode · May 31, 2006

Quote from Cache Landing:

Rally, it seems you and I are similar in yet another aspect of trading. We have very similar monthly targets.

monthly? you are too conservative buddy, those were my daily targets

ryank · May 31, 2006

Quote from Cache Landing:

Any schmoe that follows this thread can do better than 10% annually. Given the placement of his spreads I would assume he is talking about at least 10%/month.

10%-30% a month is pretty impressive. I've been averaging mid single digits per month and been pretty happy. Maybe I need to up my expectations!

rallymode · May 31, 2006

Quote from Cache Landing:

Any schmoe that follows this thread can do better than 10% annually. Given the placement of his spreads I would assume he is talking about at least 10%/month.

Actually cache, those are annual goals. My SPX strategy is positioned for 10-20% annually while my aggressive port aims for 30-40%. Although i usually bring in an average of 70% return on risk, i only risk 3-5% of port value. Those are all annual and are just goals, only relevance of the goal number is the risk i take, it is centered around those goals. I am also positioned for a max of 5% drawdown.

By the way, george soros made an average of 30% over 25+ years if i am not mistaken. If you guys can do better than that consistently my hat's off to you.

Sailing · May 31, 2006

You may want to consider Diagonals instead of credit spreads if you're really concerned about 'Black Swan' events.

Quote from Synaptic:

Coach,

The volatility changes over the last month have me thinking that I don't want to do PUT spreads anymore, only CALL spreads. I'm just concerned that a black-swan event or run of panic selling could crtically hurt my account and psyche. I'm starting to think that I only want to do credit spreads exclusively when stochastics look right and I can stay FOTM. I want to then possibly augment these trades with debit spreads where my potential loss is known up-front. Any comments ?