Vanzandt vs. Destriero Trading Competition

[destriero]

Max, you’ve never seen an option that wasn’t a short.

 

[El OchoCinco]

I am mainly interested in short strangles to counter my opponents butterfly plays and their potentially inherent statistical advantages. .

Your positions have nothing to do with anyone else's...

Your short strangles have no effect on Dest's FLYS nor do your short strangles negate any statistical advantages of someone else's position. You are not even doing them on the same underlyings.

I have seem some BS swung around but that is pretty deep .

 

[destriero]

Your positions have nothing to do with anyone else's...

Your short strangles have no effect on Dest's FLYS nor do your short strangles negate any statistical advantages of someone else's position. You are not even doing them on the same underlyings.

I have seem some BS swung around but that is pretty deep .

What’s nutty is the implication that wings are the loss-engine. Decay on perhaps six cents in wings? Obv we are talking about naked combos on street vol and not index. You can’t short a two lot SPX for less than $100K under RegT.

Jul6 exp:
Short one ATM combo in SPX = $55K
Short one 2600/2700/2800 iron fly = $6,700

Leverage factor. You can do a 15-lot fly vs. a 2-lot short straddle. Obv you’re not going to leverage because you can, but where is the stat-advantage? Over 10x the decay in the fly. Trade cash secured if you want, but that’s the only way to do it if you want to trade a naked combo in this journal.

Market can go to zero and you’re out $100K in the fly. Mkt goes to zero and you’re out $540K in the naked combo.

8X the req to save $400 in premium?

 

[destriero]

Max, trade cash-secured. You sell 10 naked combos on a $50 strike at 2.20 for $2,200. $50,000 less the credit received = $47,800 haircut. Spot rallies a ton and we will mark a haircut after the close. Doesn’t make a lick of sense, though.

 

[El OchoCinco]

What’s nutty is the implication that wings are the loss-engine. Decay on perhaps six cents in wings? Obv we are talking about naked combos on street vol and not index. You can’t short a two lot SPX for less than $100K under RegT.

Jul6 exp:
Short one ATM combo in SPX = $55K
Short one 2600/2700/2800 iron fly = $6,700

Leverage factor. You can do a 15-lot fly vs. a 2-lot short straddle. Obv you’re not going to leverage because you can, but where is the stat-advantage? Over 10x the decay in the fly. Trade cash secured if you want, but that’s the only way to do it if you want to trade a naked combo in this journal.

Market can go to zero and you’re out $100K in the fly. Mkt goes to zero and you’re out $540K in the makes combo.

8X the req to save $400 in premium?

My point is your strategy and underlying selection are entirely your own, not a counter to someone else's "edge". If Dest puts on a FLY on TSLA and you put on a short straddle, you are going at it from different end result desires.

 

[destriero]

My point is your strategy and underlying selection are entirely your own, not a counter to someone else's "edge". If Dest puts on a FLY on TSLA and you put on a short straddle, you are going at it from different end result desires.

You replied to me, I realize, but his argument is that the difference between the two methods is the edge isolated to the wings, or lack thereof. That’s the “all options are meant to be shorted” argument taken to its terminus.

IOW, “what’s the difference between a short straddle and a fly? Edge.”

The edge between the TSLA fly and the short straddle has nothing to do with the wings.

 

[maximumpossiblesuffering]

I get it, but just buy wings. Back in 2002 I posted the gains from the COMS RAES arbitrage here and the OCC had a paper copy of the post and used it against me in Discovery. I can understand not wanting to use your default account, but wings are literally a Big Mac meal.

Am driving now. Will follow up later.

 

[El OchoCinco]

You replied to me, .

Sorry just realized it was your post not his.

And my point was what you said, the wings of the FLY are not the difference maker, it is strike selection and bias as well as timing for vol. So not sure I agree with his assessment his short straddles are a counter to your FLYS.

 

[destriero]

Sorry just realized it was your post not his.

And my point was what you said, the wings of the FLY are not the difference maker, it is strike selection and bias as well as timing for vol. So not sure I agree with his assessment his short straddles are a counter to your FLYS.

Of course they are not. The only exception would be a diagonal vs. his naked combo.

 

[destriero]

DESTVZ1: L 4 GOOGL Jul6 1087/1125/1200 231 puts from 43.75 EOD 43.55 OUT 35.85 (3,160)
DESTVZ2: L 20 TSLA Jul6/13 340 put calendar from 3.48 OUT 3.58 $200
DESTVZ3: L 10 AAPL Jul6 180/185/195 in puts from 5.87 OUT 5.90 $30
DESTVZ4: S 4 SPX Jul9 2650/2680/2770/2800 iron from (6.45) OUT 7.70 ($500)
DESTVZ5: L 12 SPX Jul3/9 2715 put calendar from 7.8 OUT 9.05 +1,500
DESTVZ6: L 10 SPY Jul9 272 puts from 1.95 OUT 3.34 +1,390
DESTVZ7: L 3 SPX Jul9 2675/2700/2750 231 in puts from 10.75 OUT 14.35 +1,080
DESTVZ8: L 2 ESU8 from 2724.00 OUT 2716.00 ($800)
DESTVZ9: L 1 ESU8 from 2720.75 OUT 2708.75 ($600)

($860) to date. Flat positions.

DEST10: L 3 GS Jul13 200/225/237 132 in calls from 14.82 EOD 16.26 +432
DEST11: L 4 BA Jul13 300/340/360 132 in calls from 23.65 EOD 25.17 +608
DEST12: L 3 AZO Jul20 600/680/720 132 in calls from 44.55 EOD 45.40 +255
DEST13: L 1 SPX Jul9 2630/2730/2780 132 in calls from 53.45 EOD 56.85 +340
DEST14: S 5 SPX Jul6 2640/2670/2760/2790 irons from 4.60 EOD 2.90 +850
DEST15: L 2 GOOGL Jul13 1070/1140/1175 132 in calls from 30.40 EOD 28.35 (410)

+$2,075 on open positions.
Previous balance 99,140 (max draw)
MTM = $101,215