Who is really making a living trading options??

Free Thinker · Nov 17, 2011

Quote from darp:

Hi Atticus,

Thanks for the warning. I have not yet read the news, nor found out yet why RMBS dropped so much. Was going to do that before entering a position. Know some about RMBS in past but have not had a position in it for over a year.

Cheers

its simple. rmbs does not have a real business. its business is suing other memory makers for royalties based on a patent that was obtained under questionable circumstances.
the market was betting on rmbs winning this last case and recieving billions in royalties. it was a total crapshoot. they lost the case. now what? who knows.

FrankSlaughtery · Nov 18, 2011

Quote from atticus:

Sorry, but you had to be delusional to sell vol in RMBS with a major court ruling on the calendar.

+1. rmbs is has extreme biotech like vol. anyone selling puts ahead of the court ruling deserves to lose EVERY penny. at least very least spread it so you're risk is capped.

BeatingtheSP500 · Nov 18, 2011

Quote from darp:

RMBS did a black swan worst case today. BUT in defense of John who was just kindly sugesting anothe hi IV stk, black swans hurt most income strats even cal sprds get killed.

BTW think will Sell puts on RMBS today, as at 8 now fits my profile.

Cheers

If you thought that was a Black Swan event you are mistaken.

atticus · Nov 18, 2011

The RMBS court decision was no different that a small-cap biotech into an FDA decision. You simply have no business selling vol in that ticker. You would've needed a 400-line on vol to survive, or to sell upside calls. Best scenario would've been to structure an upside short straddle, but it's moot.

Kevmeister · Nov 25, 2011

Quote from MACD:

There is an Edge in trading options.

That edge is understanding how to structure a position that will take advantage of market assumptions and assessment of Volatility.

It is not, at first, easy to understand. When you "get it" you will be amazed at what took you so long to grasp it. When you own the edge you will find it easy to structure high probability trades.

Will you have winning trades all the time? NO

Will you be consistently profitable with the "edge" over time? YES

Is it worth it? Absolutely!

+1

arbs-r-us · Dec 22, 2011

Quote from atticus:

The OCC linked the exchanges in 2001 which barred any fill of any size on a crossed quote. IOW, no fill would occur if you hit a 3.25 bid on PSE with an offer showing 3.00 at PHLX.

I know this because I got a letter from the OCC via IB which threatened to claw-back the crossed market gains. Anyone who was involved in the litigation would know that the trading in a specific ticker resulted in the inter-exchange linkage action.

LAC's "pick-em" market (for those that don't know) was simply a 3.00 x 3.00 option in an inter-exch market.

Where's that darned letter...... Darn, Darn, Darn....

atticus · Dec 22, 2011

Quote from arbs-r-us:

Where's that darned letter...... Darn, Darn, Darn....

I promise to bring a copy when I stop by your hovel to shove your head up your ass (in case it somehow gets dislodged).

Merry XMAS

HurricaneUS · Dec 30, 2011

This whole thread is the reason why most don't make money trading options. 35 pages of nothingness....pure conjecture and speculation

Imagine atticus, sle, martinghowl, and stardust sitting together at a table at Starbucks after coming down from their ivory towers and sipping on caffe lattes into the wee hours........all the while not making any money!!

This guy below talked the talk and walked the walk:

http://www.elitetrader.com/vb/showthread.php?s=&threadid=141574&perpage=6&pagenumber=1

he was printing money and then he just up and left...wtf happened to him...let's discuss his methods..

Free Thinker · Dec 30, 2011

Quote from HurricaneUS:

he was printing money and then he just up and left...wtf happened to him...let's discuss his methods..

"time to pray."
maybe he found out prayer does not work.

HurricaneUS · Dec 30, 2011

Quote from Free Thinker:

"time to pray."
maybe he found out prayer does not work.

did you read the entire thread?...at first i thought he was a joke too until i read the entire thread...then it occurred to me that he was literally printing money...i suspect that he realized what he had and decided to fall off the planet before we could reverse engineer 'em......anyone else care to chime in on how he was doing it...