Recent content by rb107

Ok. I understand you need to have things spelled out several times. How do we measure how close the SPX price action is to a normal distribution? It's called SKEW. Skew measures this difference (I suggest you Google the definition and its application). Therefore, we have a quantitative...

Ok. Let's focus on what was said. I said the SPX price action is predominantly random (not totally), and that there are outliers due to unexpected events. These outliers occur infrequently (you claim frequently, based on your research which you cannot provide). I also said that the SPX...

Ok. Now we get into irrational responses. Randomness is based on Brownian motion which exhibits a normal distribution. The fact that there are numerous other distributions is not proof that randomness is uniquely Brownian (or that the SPX does not, in your opinion, exhibit Brownian motion)...

I believe I do. Randomness is based on Brownian motion which exhibits a normal distribution since the universality between Brownian motion and a normal distribution are closely linked. See http://www.trade2win.com/boards/newreply.php?do=newreply&p=2207118 In plain English, random motions are...

Actually, independent research over the decades have proven that the price action of the SPX is random on a daily basis. In fact, Eugene Fama, Llars Peter Hansen, and Robert Shiller were awarded the Nobel Price in Economics recently. Their work showed that asset prices move randomly in the...

Yes. But it's not just opinion; it's based on research that I and many others have performed. I suspect that you do not. If so, I would ask what you base your opinion on. If your response is simply from experience, then it's still opinion. Besides, I've been trading since the '70s, and my...

Yes I am. And based on the percentage daily change in the SPX (specifically), the price action is predominantly random. This is always another point of controversy amongst traders.

The specifics, Shakone, is the Probability model which provides the std dev (and the percentages) based on IV. You are, of course, free to believe what ever you want.

If you keep your position size small, you will not get wiped out. I trade the SPX and while I've had positions challenged, in most cases (for the Weekly SPX) it expires OTM. The one occasion where it did not (over 5 yrs), I lost a small amount. Besides, using the Expected Move (and not the...

Is Karen legit. I certainly believe she is, since I understand the strategy she is using: strangles at around 5%-10% Prob of expiring ITM; in other words, the probability of profit is around 84% (or 1 std deviation). In addition, she is very aggressive risking 50%-70% of her account on trade...

Introduction - seasoned trader Hi: Since retiring, I have devoted a lot of my time to becoming well acquainted with options, and option strategies and adjustments specifically. I've also had the time to conduct in-depth research to debunk a lot of the opinions that long-time floor traders (now...