This Forum overtrades options

[DontMissTheBus]

Holy crap... let's hope his actual sales pitch to the retirees down in FL is as bad as mangled knowledge of finance....

But, to be fair, wolinksy - I'll take back what I said earlier: you are exactly the type made for being a hardcore CFA member: arrogant, mostly ignorant about how little you actually know, and on that slimy fringe of the industry know as retail sales that makes the rest of us somewhat queasy to be associated with;

If you ever manage to pass level III, I have no doubt you'll become the head of your local CFA chapter quickly.

Quote from bwolinsky:

DontmisstheeducationIpaidtwentydollarsmorethanthenhundredthousanditcostme,

I utilized Envestnet asset management, 3rd party asset managers, and I significantly outperformed the market while managing over $5.5 million. My favorite recommendations were for Wentworth, Hauser, and Violich that had an excellent International Stock fund designed for managed MMA's and those worked great once Wall Street stopped panicing.

Incidentally, if you want to know what people like you don't do for a living, I'm exactly what you'll never be. So get lost, and have a little professional courtesy, asshole. You're such a dickhead, and that's putting it lightly.

 

[atticus]

Quote from hankster:


Your max loss is about 155 if price closed at 30, but if price is above 33, your max gain is unlimited.

WOW.

Check it out.
let me know if my math is wrong.

Hank

You're naked after Dec expiration. It's a bear-delta term-structure trade (short "switch" (back month) and vola)) and I would not want to be short a naked SPX put (synthetically) in March. Your hedge has less than 5 weeks remaining. You need a rally into Dec and then a drop, unfortunately, the haircut will more than double and it offers you no opportunity to roll out of Dec either through time or price. Your haircut more than doubles after Dec rolls of as well.

Are you comfortable holding the Mar naked call at a 75-credit? IOW, will the Mar call be trading +/- 0.75 on Dec 16 (in your estimation)?

 

[iceman1]

Quote from Riffraffpatrol:

Roflmao... the blind leading the blind-- now that's priceless....

BWego-- it is now more crystal clear than ever u don't have a clue about options....

I thought the 33c was SOLD ? Once the 30c expires, if you keep the 33c. would you not be naked. Am I missing something, did I read it wrong?! How is the upside 'unlimited' in this diagonal - was the 30c sold and the 33c bought? ?

 

[iceman1]

Quote from iceman1:

I thought the 33c was SOLD ? Once the 30c expires, if you keep the 33c. would you not be naked. Am I missing something, did I read it wrong?! How is the upside 'unlimited' in this diagonal - was the 30c sold and the 33c bought? ?

i didn't see your post atticus.

 

[iceman1]

Quote from Riffraffpatrol:

Roflmao... the blind leading the blind-- now that's priceless....

BWego-- it is now more crystal clear than ever u don't have a clue about options....

who is laughing now? Who is being arrogant ? who is clueless?

He was correct - you were wrong!!!!
just saying!

 

[kinggyppo]

Quote from bwolinsky:

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?

speaking of priceless, I have no words.

 

[TheGoonior]

Quote from hankster:

A picture is a 1,000 words so here is the trade.
If you don't understand the picture, maybe somebody else will take the time to explain it to you, but this will be my last reply to you.

Good luck, you will need it in the real trading world.

To be fair, he was commenting on your original trade, which had an obvious typo in the Dec strike price (30 vs. 37).

 

[hankster]

You're naked after Dec expiration.
That's correct and I will be out of the trade by Dec 2011 expiration of Dec 17th, the red line on the graph. I am covered until Dec expiration which is all I care about.

It's a bear-delta term-structure trade (short "switch" (back month) and vola)) and I would not want to be short a naked SPX put (synthetically) in March.

Neither would I.

Your hedge has less than 5 weeks remaining. You need a rally into Dec and then a drop, unfortunately, the haircut will more than double and it offers you no opportunity to roll out of Dec either through time or price. Your haircut more than doubles after Dec rolls of as well.

Win, lose or draw, my termination is Dec 17th or sooner.

Are you comfortable holding the Mar naked call at a 75-credit? IOW, will the Mar call be trading +/- 0.75 on Dec 16 (in your estimation)?

I have no idea what will happen, but I am covered until Dec. expiration, my max loss is defined, my margin is reasonable and I have potential for unlimited upside.

For example, IRAN launches Nukes at Israel and the market dumps 1,000 points. This trade would increase almost 300%.

Most likely, there will be some theta decay by Dec expiration.
Lets say, its .25, then my return after closing the spread would be
(75-25) / 216 = 23.2%. I am happy to take that.

Hope this helps.

 

[hankster]

We go back to 2005 posts when we discussed several trades.
Hope you are doing well.

 

[atticus]

Quote from hankster:


For example, IRAN launches Nukes at Israel and the market dumps 1,000 points. This trade would increase almost 300%.

I have no idea what will happen, but I am covered until Dec. expiration, my max loss is defined, my margin is reasonable and I have potential for unlimited upside.

March would explode if market tanked. Dec would trade a small premium over intrinsic as we approach exp. At 33 you're looking at perhaps 3.50 on Dec and 4.50 on March (say Dec 5).

Unlimited upside?!