Writing options for a living

momoneythansens · Oct 17, 2006

Quote from Trader KGB:

I was aware of that. The question is, by what degree would the real-world factors (comm, fees, taxes) negatively effect the absolute return, and would that effect diminish the benefit (lower risk) of that strategy?

With BXM futures, most of those real-world factors go to nil for comparison's sake with presumably the additional benefit of futures margining. Talk about the lazy man's covered CALL!

Die thread die!

just21 · Mar 6, 2007

If you are short otm options and the market moves towards the strike should you delta hedge at the strike or completely hedge as you did not delta hedge when the position was instigated?

RichardRimes · Mar 6, 2007

In many different threads and places its been noted that hedges do not work AFTER the fact. WHEN you sell an OTM put or call...THATs when you put the hedge on. Otherwise accept that the risk you take is the full loss you accept.

Profitaker · Mar 11, 2007

Quote from just21:

If you are short otm options and the market moves towards the strike should you delta hedge at the strike or completely hedge as you did not delta hedge when the position was instigated?

When the delta on your short position reaches an unacceptable limt.

taowave · Mar 11, 2007

Quote from just21:

If you are short otm options and the market moves towards the strike should you delta hedge at the strike or completely hedge as you did not delta hedge when the position was instigated?

It really depends upon what type of trader you are,and just how quantitative your approach is.

Let me first ask you this..

When you sell option premium,are you doing it as a directional bet,or are you trying to capture the differential between the implied vol you sold vs your forcasted realised vol(historical)...??

IV_Trader · Apr 21, 2007

Quote from CYOF:

torontoman...Yes...but u mst know what u are doing...Yes...and a few have it mastered...and Yes...but there are a few here... ...whom u will see shortly...that will try and tell u differently...and u must always ask yourself...what % of Options expire worthless...then u must always remember this figure...when u are reading the so called good advice that u are getting...from the so called experts...:eek:

Rgds,

CYOF

What is wrong with you ???

IV_Trader · Apr 21, 2007

I see. By any chance... did your daddy ever ...throw you up high in the air three times ....but... caught you only twice... when you was a child ?

MajorUrsa · Apr 21, 2007

It is a real shame that an, at times very interesting thread like this can't, after running for a year and a half, get a good rest and a frustrated kid like this comes by to wake it up. A sad ending. The next revolution in internet will be the idiot-filter.

Ursa..

atticus · Apr 21, 2007

Quote from CYOF:

at least I knew my daddy......and I doubt if u see anything...and...especially anything in relation to making money trading derivatives...for ur nick tells all...keep up the good work...u are doing a great job...i am sure u are sharing some good derivative trading stories with a few others here...

IV's hit rate exceeds 90% at 1:1. Something you won't achieve in 10 lifetimes.

Nanook · Apr 21, 2007

Quote from CYOF:

torontoman...Yes...but u mst know what u are doing...Yes...and a few have it mastered...and Yes...but there are a few here... ...whom u will see shortly...that will try and tell u differently...and u must always ask yourself...what % of Options expire worthless...then u must always remember this figure...when u are reading the so called good advice that u are getting...from the so called experts...:eek:

Rgds,

CYOF

I absolutely and unequivocally agree with you...that one .... must know... what they are doing ... in the financial... Hey! What's going on?!... My keyboard is shrinking!!!... where is my... numerical ... keypad... it's gone...!... and now .... my function .... keypad... is gone too... and my 'f' key... what the phuck? ... hey what is going .... on here... ? ... my whole keyboard is shrinking... and all... I'm lepht with... is the period key.............................................................................................................................................................................................................