justtellingitasitis
Junior member
- Messages
- 10
- Likes
- 6
Now, as anyone that has seen anything I have written in the short space of time I have been publicly posting here will know, I think trying to trade independently is ridiculous. I think you will lose, and let's remember, you will lose YOUR money.
I am not here selling anything or making anything or anything like that. I actually want to debunk the vast majority of what I see here. Which already ironically makes me sound like every other c&nt.
Options are a non-linear product. That is an amazingly simple, statement of fact, and cannot possibly be disputed. If you don't know what that means - IMMEDIATELY GIVE UP ON OPTIONS as being your traded product of choice until you do some research. So many questions are asked here that are very easily answered with just a tiny bit of work.
If you want to learn, tryh youtube, but try searching for things like MIT Introduction of Calculus, intro to finance, intro to stats, whatever you want to learn.... A lot of university are now publishing almost entire courses. They are brilliant. Have a look at this to give just a tiny tiny tiny hint of what is there for free....
**
Options can be a brilliant trading tool. They are very efffective, can be cheap, and are a geniunely good product to know about for the private individual. But, you have to at least have a rough idea what you are trading. Let me clarify, you shouldn't be trading options. Buying an option to give you some leverage is not necessariyl a bad idea. Options are essentially insurance products on price. Try and think in insurance terms - you cannot afford that one big event to go against you. It would make you lose more than realistically you can happily deal with. However, they do allow you leverage when you buy them... They allow you to basically bet on a future outcome for a small original outlay. That's not necessarily bad - but remember it is a bet....
Look at oil now.... say it is 95.5. Well, oil is an incredibly voluatile market where nearly everyone would know more than you. It's not sensible to risk everything, or even a lot. However, this is where options can help you. Say you think it is going to go to $98 before end of september. Well, you can buy an option that will pay you off if this happens. If it doesn't, sure, you lose. But you know what you are risking from the off.
If you don't acutely understand what the greeks are, what a vol surface is, what a delta position is, what basis risk, hedging risk, liquidity cost, gap risk and a load of other things I have forgotten... Well, if you do not understand them, NEVER sell an option naked. You have no idea what you are doing - you're insuring an event you have no way of appreciating the probability of.
Anyway, I know even now I am waffling and this will be skipped by most. What I would implore everyone to do is ask the highly skilled people here there opinion. If someone criticizes this post, fine, but ask why? Ask what the fundamental economics is behind it.
Trading is a sexy word, trader is a sexy profession. It simply isn't like that for 99.9999999999% of people. Yes, you can earn good money at a bank. But then you have to be very knowledgeable and highly qualified to even get a chance.
To give an idea, and this is real world and someone I know very well, this was what it took and where they are.....
10 A's, 2 B's GCSE
3A's, 1B A-Level (old style a-levels)
BSc Physics
MSc Physics
Graduate programme at what was the worlds biggest derivative broker (2 yrs) (Completed all FSA regs etc)
German investment bank (analyst for 1 year - junior trader for 2 years) (completed CFA)
US investment bank (junior trader - basic flow stuff, v limited VaR - 1.5 years) (completed internal quantitative programme with structurng group)
Asian investment bank (last 3 years)
And this guy now earns probably £75-100k basic, bonus I would have no idea.
There is no easy way to make millions. There just isn't. He earns good money, because he has always done the hours, worked hard, and been reliable. That's probably as important as his skills on the market!!!
I am not here selling anything or making anything or anything like that. I actually want to debunk the vast majority of what I see here. Which already ironically makes me sound like every other c&nt.
Options are a non-linear product. That is an amazingly simple, statement of fact, and cannot possibly be disputed. If you don't know what that means - IMMEDIATELY GIVE UP ON OPTIONS as being your traded product of choice until you do some research. So many questions are asked here that are very easily answered with just a tiny bit of work.
If you want to learn, tryh youtube, but try searching for things like MIT Introduction of Calculus, intro to finance, intro to stats, whatever you want to learn.... A lot of university are now publishing almost entire courses. They are brilliant. Have a look at this to give just a tiny tiny tiny hint of what is there for free....
**
Options can be a brilliant trading tool. They are very efffective, can be cheap, and are a geniunely good product to know about for the private individual. But, you have to at least have a rough idea what you are trading. Let me clarify, you shouldn't be trading options. Buying an option to give you some leverage is not necessariyl a bad idea. Options are essentially insurance products on price. Try and think in insurance terms - you cannot afford that one big event to go against you. It would make you lose more than realistically you can happily deal with. However, they do allow you leverage when you buy them... They allow you to basically bet on a future outcome for a small original outlay. That's not necessarily bad - but remember it is a bet....
Look at oil now.... say it is 95.5. Well, oil is an incredibly voluatile market where nearly everyone would know more than you. It's not sensible to risk everything, or even a lot. However, this is where options can help you. Say you think it is going to go to $98 before end of september. Well, you can buy an option that will pay you off if this happens. If it doesn't, sure, you lose. But you know what you are risking from the off.
If you don't acutely understand what the greeks are, what a vol surface is, what a delta position is, what basis risk, hedging risk, liquidity cost, gap risk and a load of other things I have forgotten... Well, if you do not understand them, NEVER sell an option naked. You have no idea what you are doing - you're insuring an event you have no way of appreciating the probability of.
Anyway, I know even now I am waffling and this will be skipped by most. What I would implore everyone to do is ask the highly skilled people here there opinion. If someone criticizes this post, fine, but ask why? Ask what the fundamental economics is behind it.
Trading is a sexy word, trader is a sexy profession. It simply isn't like that for 99.9999999999% of people. Yes, you can earn good money at a bank. But then you have to be very knowledgeable and highly qualified to even get a chance.
To give an idea, and this is real world and someone I know very well, this was what it took and where they are.....
10 A's, 2 B's GCSE
3A's, 1B A-Level (old style a-levels)
BSc Physics
MSc Physics
Graduate programme at what was the worlds biggest derivative broker (2 yrs) (Completed all FSA regs etc)
German investment bank (analyst for 1 year - junior trader for 2 years) (completed CFA)
US investment bank (junior trader - basic flow stuff, v limited VaR - 1.5 years) (completed internal quantitative programme with structurng group)
Asian investment bank (last 3 years)
And this guy now earns probably £75-100k basic, bonus I would have no idea.
There is no easy way to make millions. There just isn't. He earns good money, because he has always done the hours, worked hard, and been reliable. That's probably as important as his skills on the market!!!
