At $5MM I figured the sysyem must have been crap. But at 8.5MM it must be a great system!
This Forum overtrades options
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At $5MM I figured the sysyem must have been crap. But at 8.5MM it must be a great system!
It has an 88% win percentage and it has been a long time since I calculated APR but the APR used to exceed 225% when you could go 2:1 leveraged on QLD or QID but now you can't do that so I think it dropped from a long period of flat from whatever the chart on c2 shows for the first one and now the APR is between 160-190% depending on leverage.
Combine it with the timing of what I have and it should be unstoppable but my covestor account doesn't show it even though the average profit of 5% on QLD and QID is (1+.05/0.9)^3/2-1=8.448% so being at -8.2% I'm pretty sure I'll be positive by the end of the month but only marginally.
It hasn't traded for awhile but it did significantly beat the market from the time of the last sale. Think NQ was sold at 2375 about so that's where our TQQQ long and SQQQ short went out, just to watch it recently go through 2300 so if you were long through that if you'd like to compute the leveraged percentage...
Here is that calculation:
((2300/2375)^3-1)/0.9=(10.197%)
So.......even if you didn't want to trade leveraged that still would have saved the requisite percentage unleveraged approximately 3% on a portfolio and in a game where you might have a high water mark of 7% if you're above that and think you're going to be earning performance based fees then you sure as heck would have wanted to know when to time that.
At this moment NQ is about to either make a lower high or breach the last lower high however this would still be a lower high and if it doesn't go above 2400 then dam. It'll just have to be till we get some good apple news.
The Street looks like they're taking a step back from Apple but more than likely their calls that ipad and iphone sales will be flat or even down is completely ludicrous and whoever made that call, think it was Morgan Stanley, will probably lose a lot of money and possibly his job. Don't think anybody's got a sell, though.
(I mention Apple because it drives NQ's direction).
Atticus, some people know how to hedge directionally... for profit! Not just to get options positions to be delta neutral.
I know you're all into spreads mostly but to really do a good job you'd have to be able to store commodities, and I'm sure you've not gotten that far along in your individual options trades.
What's the matter? Can't buy a supertanker yet? No? How about just a regular tanker? Lease one like GS does?
I don't know why atticus does what he does, but for myself, the most money I ever made on a single trade was on a delta neutral one.
Of course, it wasn't a hedge....
The point of options is the multiplicity of ways they give you to make money, and the equally large number of ways they give you to efficiently hedge a non-options position. Some of that is directional, but a decent piece can take advantage of time decay and buying/selling volatility.
Sim trading stocks is probably a better bet than trying to sim trade options, btw, since most of the time even with the liquid ones you put on a limit order for some version of a complex position and then wait hours to get filled, which is why TOS comes with a spread book scan where you can see all the spreads for whatever underlying you're trading that are waiting for a fill. Lots, of course, expire without your ever getting filled. For the ones that do, interestingly, I've come to the conclusion that the longer I wait for a fill, the more likely it is the position will be profitable.
No way in the world can you mimic that on a paper trading platform. They all have some version of how to decide you get filled that is way more optimistic than what happens in reality. In reality, it's you against a market that really really doesn't want to give you that entry price you're looking for.
Of course, it wasn't a hedge....
The point of options is the multiplicity of ways they give you to make money, and the equally large number of ways they give you to efficiently hedge a non-options position. Some of that is directional, but a decent piece can take advantage of time decay and buying/selling volatility.
Sim trading stocks is probably a better bet than trying to sim trade options, btw, since most of the time even with the liquid ones you put on a limit order for some version of a complex position and then wait hours to get filled, which is why TOS comes with a spread book scan where you can see all the spreads for whatever underlying you're trading that are waiting for a fill. Lots, of course, expire without your ever getting filled. For the ones that do, interestingly, I've come to the conclusion that the longer I wait for a fill, the more likely it is the position will be profitable.
No way in the world can you mimic that on a paper trading platform. They all have some version of how to decide you get filled that is way more optimistic than what happens in reality. In reality, it's you against a market that really really doesn't want to give you that entry price you're looking for.
Goldman lost $200MM in CL last quarter. Perhaps that news didn't make it to KC.
No tankers, and no takers at 8.5MM I'll wager, but perhaps you'd want to stop from blowing up long enough to sell that system (that blew up). THAT'S a paradox.
5/7 systems abject failures? Another two that were orphaned with big losses. HTF do you stay out of a straight-jacket? You Houdini Jr.?
Whatever your definition of blow-up is the market drew down 55% during that time and I come down from a profit of 100% 40% over two years ago and you give me shit about it.
QID and QLD drewdown 90% at the same time.
The pairs system trading QID and QLD is the only one I've traded, and the only one I will trade, but you could do it with SDS and SSO or any other 2x combination. You just have to optimize them but the wl4 Perl needs to be converted now to wl6 .NET.
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