SPX Credit Spread Trader
- Thread starter El OchoCinco
- Start date
Why pretend. It looks like I fell for your parody hook, line and sinker. 
But let's not focus on those of us who fell for the parody, but instead focus on yet another of your many talents.
Good job, Mo
But let's not focus on those of us who fell for the parody, but instead focus on yet another of your many talents.
Good job, Mo
Quote from momoneythansens:
Didn't want to make anyone look silly. I thought my parody was quite obvious but perhaps a little too deadpan and/or too much credibility built up from earlier posts. Still, the content....
In the interest of saving face, it might be best we all collectively pretend that those who took my phony strategy based on a fictitious chart study (wtf?) seriously were just playing along with the parody themselves
Thanks all, haven't laughed that much in a while. Happy holidays!
MoMoney.
I was out all day at parties and could barely read the computer screen with one eye open. Last night at the time it looked like MO cracked the DaVinci code to me.
Okay, rational thinking in settling in now, it looks pretty hilarious today, LOL. I asked the mod to delete my response but I guess it's up there for all eternity and posterity.
Okay, rational thinking in settling in now, it looks pretty hilarious today, LOL. I asked the mod to delete my response but I guess it's up there for all eternity and posterity.
Good sports you two!
Before I get any more PM's on my strategy to quadruple account in three months, I'd like to re-emphasize that my post was a joke. Untrue. Made up. Fabrication. Fiction. Tall Tale. Fish Story. Flight of Fancy. A Yarn. Bunk.
I should start a website..."For only $499 I'll show you how to..."
We digress...
Before I get any more PM's on my strategy to quadruple account in three months, I'd like to re-emphasize that my post was a joke. Untrue. Made up. Fabrication. Fiction. Tall Tale. Fish Story. Flight of Fancy. A Yarn. Bunk.
I should start a website..."For only $499 I'll show you how to..."
We digress...
Actually I had though Mo had gone off the deep end and was going to ask RISKARB to TRANSLATE
The lottery ticket zone is bigger than 25 points even though the short and long strikes are 25 strikes apart. The profit zone is actually 50 points wide if you ar elooking at the 1200/1175 put ratio spread.
Be careful of 1:3 spreads as you have more naked options and an increase in the risks that come with naked options.
Be careful of 1:3 spreads as you have more naked options and an increase in the risks that come with naked options.
Quote from scoobie27:
Thanks for the tip coach. My IB account is ready to go and I can't wait to look at the quotes on ES when the market reopens on the 5th. Though I think I'll just start small and with buying 2 Puts and selling 4 calls or maybe bigger multiples.
The thing i noticed is that the distance between yours and also Rally's short and long puts is only 25 points which leaves little room for the lottery to happen, cause the lottery would be real nice if it did fall in betweent the strikes. It can happen but I would like to make that gap bigger and give it more of a chance.....perhaps 40pts to increase the chance of ES falling in between? But the trade off could be it won't be a credit ratio spread and I might have to sell more puts to get credit but then the ratio of sold puts to purchased puts could be 3:1 or more which may make the profile too dangerous.
Another thing I could try, to go along with the smaller multiples is to move the ratio spread closer to the money... which again would increase the chance of ES falling between the strikes. I could be wrong but there seems to be a lot of choice to play around with strike distances, ratios and adjustments if things go against you. Anyway I'll stop rambliing and better do some research.
PS. Coach or anyone else could you please clarify something for me in regards to IB ,
In IB, there are a few selections to choose from when I type in ES in the UNDERLYING column. These selections come up...Stock, Index, Futures, FuturesOptions, Futures Spread, Options, Bond. Do I just select Index for the underlying, and for the the options I plan to trade, do I also select FuturesOptions. They are both Globex products with (USD) in brackets so Im guessing those are the ES products I;ll be trading?
Thanks
I second that. Also, scoobie bear in mind that it isnt a lottery ticket per se until you have adjusted to a fly of some sort and/or bounded the risk. With these ratio spreads, you dont want the market to move towards your strikes. Sure, you have a wide profit zone but you see the same effect as you see with a fly, the gains happen very close to expiration while you still carry the unbounded risk throughout the trade. (The 1:2 ratio spread is a straightup fly with one wing)
Sure you can increase the zone but to receive a comparable credit you must go closer to the market or steepen the ratio, both of which carry their own risks. Having a wider profit zone at expiration really shouldnt be your focus with this trade. The whole lottery ticket concept that phil mentioned applies to traders who favor adjustments in certain situations and like leaving small amounts on the table for that big payoff that might come once in a while hence the term lottery ticket. it isnt the main goal with the trade.
There are other much less risky positions you can open to capitalize on a SET within a certain range. Just my 2 cents.