Who is really making a living trading options??

Quote from StarDust9182:

"WTF are you babbling about? I think it's pretty clear who's side I am on. You admonish me as a disciple and then ask me to "take a side"? I generally side with those who know of wtf they speak.

Those who live by the sword die by the sword. Tell me how your previous posts contributed to our discussion.

Stop ad hominem, join the rest of the civil community, and show me where my babbles are incorrect then. That I am open to.
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Didn't you write in your last to "grow a pair"? Please quote the specific ad hom that you find so distressing. Thanks.

The babbles are in red
 
"On the topic: Ask yourself why OTC dealing always involves quoting the market in vol and not premium."

I have already answered but here it is again - because the bookies already know how you trade and they have a different objective.
 
Quote from StarDust9182:



If bookies (bucket shops etc.) price options, then the IV or price does indicate something. It indicates what the bookie sees. IV is the odds. The bookie has known behavior. From that one can guess at the likely scenario.

There are several patterns based on precisely what the underlying and the bookie are trying to do. Computers are very powerful but one weakness is they must use a pattern. Humans can do goofy things. (look at my trades sometimes for example)

Does that help on how I view the option market and my trades? [/B]
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Stardust:

Humans can identify patterns and then align them multidimensionally in their minds across time. Some call this Informed Simplicity. A higher form of thinking. Try teaching this to most programmers however. The weakest link in the computer is outside the computer.

:)
 
Quote from StarDust9182:

"On the topic: Ask yourself why OTC dealing always involves quoting the market in vol and not premium."

I have already answered but here it is again - because the bookies already know how you trade and they have a different objective.
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Wow.
 
Quote from Pelagos:

Stardust:

Humans can identify patterns and then align them multidimensionally in their minds across time. Some call this Informed Simplicity. A higher form of thinking. Try teaching this to most programmers however. The weakest link in the computer is outside the computer.

:)
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I can back that statement up by 20 years of research, thousands of psychological experiments we have conducted and the experience we get from our in-house prop trading group that uses "Informed Simplicity" gauges to trade.

"The weakest link in the computer is outside the computer"

Amen

MAESTRO
 
Quote from StarDust9182:

"On the topic: Ask yourself why OTC dealing always involves quoting the market in vol and not premium."

I have already answered but here it is again - because the bookies already know how you trade and they have a different objective.
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Probably a stupid question based on above but if the bookies know the game then why is it when they leave the floor they still make trades based off of volatility plays?
 
AAPL shares and the AAPL Nov 385/405/425 Nov fly (neutral):

desq48.png


The spread in the complex order (3-strikes) is 3x the spread in the shares (ECN and natural mkt). I filled that fly at a nickel off the mid.

Where is the edge?
 
Quote from StarDust9182:
We are into theoretical areas and so I am not always correct, these are just my opinions and how I look at the world and how I do things.

The process you describe could be done with a one year candle and the current price in my view. The information is the same and it is all backward looking.
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You're wrong and I have already explained why...
 
Interesting comments on informed simplicity. I will do some investigation into this when I have more time. My investment has paid off. Thanks for the contributions.

Dolamite - no stupid questions, we learn by asking them. A good question, I suspect that the bookies are struggling just like us and they believe the nonsense published as well. I don't think it is an organized conspiracy or anything. The better ones survive in the job and the bad ones drop away to write books.

One of my thoughts from years ago is - Most traders have no idea what they really trade.

Just my two cents worth and clearly I am overstaying my welcome.
 
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