Really? Wow, I guess that language and attacking style has been normalized across America.
The #1 Skill In Selling Options
- Thread starter OneGlanceTrader
- Start date
Really? Wow, I guess that language and attacking style has been normalized across America.
The "loss" was relatively small. Sold 5 puts. Breakeven was at $2,75. For me it was rather
improbable that the this stock could fall from $12 to under $2,75 within one month. It hasn´t been down so much in the past. But shit happens. I think i calculated this trade responsibly.
i don’t know much about the company but my guess is that it’s a one drug wonder and that drug failed. You will be waiting years until they find another drug or are able to revamp this one. Do some research before you decide to hold this stock. It’s likely dead money for a long time as it burns cash figuring out what to do.
A decade as a market maker.
1. Market makers don’t receive commissions - often they pay them to the exchanges.
2. Market makers generally try to get risk flat. Read an options book and you will understand how they do this. They aren’t in the business of taking huge positional risk but rather earning the spread every day.
3. some market makers add stat arb overlays on their books. But in this capacity their edge would be hugely negative because as you said if you are short options gamma blows you up and if you are long options theta kills you.
The proof against your argument is that options are zero sum. If you buy an option from me, one of us will make money and one of us will lose.
If you don’t believe me about my performance that’s fine. You missed the point of the statement anyway.
1. Market makers don’t receive commissions - often they pay them to the exchanges.
2. Market makers generally try to get risk flat. Read an options book and you will understand how they do this. They aren’t in the business of taking huge positional risk but rather earning the spread every day.
3. some market makers add stat arb overlays on their books. But in this capacity their edge would be hugely negative because as you said if you are short options gamma blows you up and if you are long options theta kills you.
The proof against your argument is that options are zero sum. If you buy an option from me, one of us will make money and one of us will lose.
If you don’t believe me about my performance that’s fine. You missed the point of the statement anyway.
a billion! No! A trillion! No! Pi?
21 posts and still not one insightful thing to say about options.
best 4am read in awhile, only to be capped off by the return of margin_gamble.
OPs altruism runneth over... saving grown adults from the pitfalls of options and FX trading, one ego-filled rage post at a time.
OPs altruism runneth over... saving grown adults from the pitfalls of options and FX trading, one ego-filled rage post at a time.
That explains your biased viewpoint. I thought so.