The Beauty of Options - Portfolio Insurance at a Discount

OK,its a stand alone strategy that COULD be portfolio insurance.
You can see how the title is confusing...




ok
Sweet Bobby said:
You say tomato, I say salsa. This particular portfolio is now an incubator fund traded at TD Ameritrade under a Delaware limited partnership. The management company is an LLC with my best friend and I as the only members. Future profits of the management company are split 50/50.

The fund is not yet open to outside investors. I anticipate (and my attorneys are preparing) for a transition out of the incubator stage at the beginning of 2021. Robert Green has advised me regarding the tax structure of the fund, and based on my consultation I have decided to only trade 1256 contracts. NFA exemption has been secured.

The ship has been commissioned and there’s no turning back. This particular shop happens to thrive on icebergs and generates meteoric returns as we encounter them. But when the seas are smooth sailing, we also make money. And, it’s not because we make the same exact trade over and over. I’m a seasoned veteran, and I’m more than ready for what lies ahead.
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taowave said:
OK,its a stand alone strategy that COULD be portfolio insurance.
You can see how the title is confusing...




ok
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But I am insuring the portfolio against down-side tail risk. The cool thing is I can actually profit from the insurance, and the insurance doesn’t create a draw against the account performance. So I’m prepared for a drop, but still chugging along making profits in an upward market. Pretty cool, huh? The most significant risk that I have is a slow grind down market, but I have very specific trades to implement if that happens.
 
So Des unblocked me again yesterday so that I could see a few of his sissy jabs, but he has now blocked me again! Also, he has had the mods close the other thread! I think the boy may be bipolar. I’ve been around a few psychotics like him. Please tell me that y’all see him for the nut that he is? And as far as I know, he has never shared one of his proprietary trades! Not sure why so many of you buy into his bullshit. Is it because he tries to speak in terms that you do t understand, so you just assume he’s smart? He’s a dingleberry in the ass of trading. Nothing more!
 
You are long tails. You’re not insuring anything. You don’t have a portfolio to insure or at least haven’t mentioned it.
 
Sweet Bobby said:
Iron chef, I’ve always respected your input. You are onto the secret sauce here. You just can’t blindly put the hedge on and walk the damn dog. This is a complex strategy that involves multiple “if x, then y” decisions. My trading plan is well developed and is a 73 page document outlining the entire process.

I started the hedge fund this year only after I saw what the strategy was capable of producing. I brought in one of my lifetime friends to teach him the strategy in the event that I pass away so that the strategy can continue to provide for my family’s future.

Do I brag a bit too much? Oh it’s all in fun, much as Rush Limbaugh tongue in cheek states that he is performing his daily host duties with half his brain tied behind his back, just to make it fair.

I exhibited a bit of showmanship. Just had my end of quarter analysis with my business partner. Here’s the cold, hard truth. If there is another drop in the market like what what happened in February and March of 2020, this portfolio in its current state will be up a minimum of $77,000 with a maximum potential of $310,000!

There will be those who laugh and ridicule the above forecast, but those folks ain’t sleeping under my roof. I would love to have a discussion group with other like minded traders to talk about these things. As most of you know, trading can be a lonely endeavor. You can’t talk about this stuff with most of your friends. Their eyes begin to glass over. That’s why most of us come to a place like Elite Trader. We come here to discuss those things that we can’t discuss with anybody else in our “normal” lives. But the moment you start sharing, along comes a dick like Poopy Des that makes you withdraw and hold back and never won’t to share with any human age because Des makes you realize that there is a segment of human kind that is not kind! He represents the Bully in school that made you dread every day of you school life. He makes you wonder why should I even bother sharing anything with anyone! Yet, I know there are good people on this forum like you who wants to make learning a two-way Street. I’m trying to just stay in my lane and avoid the head on collision.
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Thank you for your coaching.

Most of the time you owned/longed left tails to protect your put-writes, occasionally caught a black swan and profited handsomely. Good for you. :thumbsup:

I have been looking for tail protection since 2013 when I started. Unfortunately protections are not free and I am unwilling to give up profits for protection. I should hunt for black swans instead.

Thank you for giving me some ideas.
 
ironchef said:
Thank you for your coaching.

Most of the time you owned/longed left tails to protect your put-writes, occasionally caught a black swan and profited handsomely. Good for you. :thumbsup:

I have been looking for tail protection since 2013 when I started. Unfortunately protections are not free and I am unwilling to give up profits for protection. I should hunt for black swans instead.

Thank you for giving me some ideas.
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Some people just buy the hedge outright. I'm a greedy bastard, who always shops the sales. Ideally, your long puts are in the same expiration as your short puts. I first enter then diagonally, and then buy my replacement puts at a later date and at a better price.

The logical question is, "what if you're never able to buy those replacement puts if the market goes against you?" I never bought the replacements in February and March and I never needed to! Worked beautifully!
 
taowave said:
Listening to an interview with him...Brings up some interesting concepts..Thanks
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Just remember this graphic regarding negative theta from Ron's course. It's fake. It's all fake! It does not and will not create negative drag on the portfolio. Des Poopy fails to understand this concept, and he's not open to learning.

fake.JPG
 
Now that I have conquered and obliterated Poopy Dest and the rest of the detractors, maybe some actual two-way learning can happen in this thread. Is there hope for humanity?
 
I have a few questions:

Why is Booby down on the year on the $36K account?

Why is Booby trading less than $40K?

Why does Booby think his decay has thousands of dollars in var? Why does he insist he has zero decay?
 
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