Plain Vanilla Options Trades.

[SOCRATES]

so to prove that you get it consistantly right, how many trades will you be posting?

No, I haven't voted - I have no knowledge of options and I wont guess. But as with all trades I'm sure the skill of the buyer and seller has a massive part to play?

Cheers,
UTB

PS - credit where its due for putting your **** on the block. I'm not sure (or qualified to say) if it proves the underlying point, but it is a quantative post non the less.

10 , 20 , 30 , 40 , 50...60 ...70....80....90....100 ....perhaps.....whatever....until I have not only proved my point but am sure it is firmly rivetted...:cheesy:

In all trading.... skill is very important yes.
When you add skill to the odds being in your favour you know the rest.
When these odds are known and can be statistically verified that is another notch up.
When you have a cluster of abilities that are welded together the effect is devastating. but here we are only interested to conclusively prove the point I am making, which is that writers have the edge over the buyers.

 

[Charlton]

I am enjoying this immensely:cheesy: I am sure a lot of you are too.

Socrates

You are "write" - immensely enjoyable.

Best thread on T2W for a long time.

"Write" on

Charlton

 

[NotQuiteRandom]

Socrates,

With respect: I both agree and disagree.

I have an options system which I have run for 5 years on the SPX options which is always net short of far out of the money vol and it has been great. Statistical vol is usually lowe than implied vol and the skew is always pretty steep.

Having said this I have another system which buys slightly out of the money calls (just on stocks) which have a positive expected return on a case by case basis. Anomolies occur and can be exploited. This has also been a solid strategy for me (filtering for opportunities is the science).

 

[Profitaker]

NQR

You have to ask why the vol skew exists. It didn't prior to 1987.

 

[SOCRATES]

Socrates

You are "write" - immensely enjoyable.

Best thread on T2W for a long time.

"Write" on

Charlton

I am doing my best to pick situations that will yield consistent results, to conclusively show the writer has the edge over the buyer.

What happens is that immediately I do that and it is seen to be consistent, then I start to be asked questions about methods, and tactics and so on.

I want to keep this thread clear of that.

I want this thread to be the test strip to prove the hypothesis is correct, and at the same time serve to disprove the detractors and naysayers.

That is why I am doing it in real time and firing live rounds.

I am pleased you find it of interest and are enjoying it.

 

[SOCRATES]

Socrates,

With respect: I both agree and disagree.

I have an options system which I have run for 5 years on the SPX options which is always net short of far out of the money vol and it has been great. Statistical vol is usually lowe than implied vol and the skew is always pretty steep.

Having said this I have another system which buys slightly out of the money calls (just on stocks) which have a positive expected return on a case by case basis. Anomolies occur and can be exploited. This has also been a solid strategy for me (filtering for opportunities is the science).

Sure, there are many ways to skin a rabbit so to speak.

What I am doing here is not so much showing how to skin a rabbit but to prove a point, my point being that the writers have the edge over the buyers.

I hope you will follow this thread and find it of interest.

 

[CYOF]

I am informed the position is filled.

I will leave you to announce it if you like.

The thing is, it is not prudent for you to leave your desk and wander off just like that...

Today happens to be safe, but you never know .....

I have been on the lookout for black swans but so far not a single one in sight.:cheesy:

Yes Socrtaes, but as we have to SHOW our doubting friends, a little risk is expected.

But as you say - NO BLACK SWANS TODAY

Filled @ 53 x 3 x 10 = £1,590

Total Premium on Feb 6125 PUTS = £3,210

Watch and learn how THE PROFESSIONALS TRADE

Do you all now see what I mean by speaking to those that are in THE KNOW.

If you want to learn how it is really done - then do yourself a big favour and talk to a Master Trader - I am glad I did

 

[CYOF]

NQR

You have to ask why the vol skew exists. It didn't prior to 1987.

Continue to DIVE & DUCK as you do Mr Post#411, but remember, we are firing live rounds here, so you may, if you are not careful, just get a PING PING RICOCHET RABBIT

 

[zupcon]

remember, we are firing live rounds here

Careful you dont shoot yourself in the foot

 

[CYOF]

As Mr Post#411 Wizard Of ODDS, and his little furry friends, keep on nibbling away, I think it is fitting to remind all of a little story that I wrote called The Little Circle.

http://www.trade2win.com/boards/showthread.php?t=23199&page=1&pp=10

One would swear that the story is actually about them

 

[CYOF]

Careful you dont shoot yourself in the foot

For one who sees all, I really thought that you would have been more observant - but, what will be will be.

When you are been taught by a MASTER TRADER, you quickly see the difference between what is the best way to do things, and what is the worst way to do things.

Your little furry friends are but INTERFERERS, and ye continue to show what it is ye do best.

Even when ye are presented with LIVE TRADES, all ye can do is spit out more of the same old rubbish to try and divert attention away from what is really going on.

The readers can make up their own minds as to who are the idiots here, and who are not.

Join them if you like, for the choice is YOURS - ALWAYS HAS BEEN - ALWAYS WILL BE :idea:

 

[barjon]

I've split off the discussion relating to BetaExoticBets - it's here http://www.trade2win.com/boards/showthread.php?t=23243

jon

 

[CYOF]

I don't think he meant hedge, I think it is a typo and he really meant margin, as in margin call.

Socrtaes, you are of course testing me - as you always do, but you know that is what I like

I will not break the rules of the Elite 3.4S - and I will only divulge what I can.

Hedging is not required as the positions are OTM, and as you rightly say, the margin is not been bothered by BLACK SWANS, EARTHQUAKES, VOLCANOS, TIDAL WAVES, or any other such things.

Richard, if you want any more NUGGETS you will have to send an E-mail or PM direct to the Elite 3.4s Club. I can't divulge more on here than I am currently doing. I do not want SE3.4S No.1 contacting me - for the last time he did, I got an earful, but I was lucky that I have a little friend called LouDean who was able to work some magic on him

 

[barjon]

As Mr Post#411 Wizard Of ODDS, and his little furry friends, keep on nibbling away, I think it is fitting to remind all of a little story that I wrote called The Little Circle.

http://www.trade2win.com/boards/showthread.php?t=23199&page=1&pp=10

One would swear that the story is actually about them

CYOF

I'd be extremely grateful if you would desist in stirring the pot on this thread, as in this quoted post and some others. As Socrates said in his opening post - "This thread is dedicated to the topic of writing plain vanilla options on the FTSE 100 INDEX, and logging of results, in series." From the comments I have received it's clear that people would like the thread to concentrate on just that and stay clear of diversion. Thank you.

jon

 

[CYOF]

Yes Socrtaes, but as we have to SHOW our doubting friends, a little risk is expected.

But as you say - NO BLACK SWANS TODAY

Filled @ 53 x 3 x 10 = £1,590

Total Premium on Feb 6125 PUTS = £3,210

Watch and learn how THE PROFESSIONALS TRADE

Do you all now see what I mean by speaking to those that are in THE KNOW.

If you want to learn how it is really done - then do yourself a big favour and talk to a Master Trader - I am glad I did

Update:

Current quotes @ 44 / 46

Can close for scalp of £450 (8 x3x10 =£240) + (7x3x10 =$210)

BUT - as I have faith in what THE MASTER OPTIONS TRADER has ARTFULLY shown me, I will not close at this time.

I WILL HOLD :idea:

You can all now THINK as to why I am holding and not taking my profits :idea:

 

[CYOF]

CYOF

I'd be extremely grateful if you would desist in stirring the pot on this thread, as in this quoted post and some others. As Socrates said in his opening post - "This thread is dedicated to the topic of writing plain vanilla options on the FTSE 100 INDEX, and logging of results, in series." From the comments I have received it's clear that people would like the thread to concentrate on just that and stay clear of diversion. Thank you.

jon

No problem Jon,

But please do ask the others to stop interfering - as this is all they are out to do.

And you were correct to shift the off topic posts.

Point taken and noted.

Regards,

 

[Mr. Charts]

cyof,
1. Are you totally convinced when you say, "Hedging is not required as the positions are OTM"?
You might consider thinking about that a little more.
2. I do not require what you call "nuggets", thank you; kind though it is of you to offer....
I can always email John if I wanted to discuss anything with him.
BTW, John I see you have a browser window open on this thread most of the time.
I used to trade options, writing and buying, very successfully, though I no longer do so as day trading US shares is a great deal more profitable.
Richard

 

[SOCRATES]

Update:

Current quotes @ 44 / 46

Can close for scalp of £450 (8 x3x10 =£240) + (7x3x10 =$210)

BUT - as I have faith in what THE MASTER OPTIONS TRADER has ARTFULLY shown me, I will not close at this time.

I WILL HOLD :idea:

You can all now THINK as to why I am holding and not taking my profits :idea:

Creating a lot of interest this thread, eh ?

Chinese proverb " in a shut mouth flies do not enter".
....ah....look ! there's ducatti on the balcony...peeping....you hoooo ! I can see you !

....aw...he's gone !

 

[CYOF]

cyof,
1. Are you totally convinced when you say, "Hedging is not required as the positions are OTM"?
You might consider thinking about that a little more.
2. I do not require what you call "nuggets", thank you; kind though it is of you to offer....
I can always email John if I wanted to discuss anything with him.
BTW, John I see you have a browser window open on this thread most of the time.
I used to trade options, writing and buying, very successfully, though I no longer do so as day trading US shares is a great deal more profitable.
Richard

Yes Richard - 100%, but I can say no more, really.

As for daytrading Nas Stocks, I was also of that opinion after 1 year sitting in front of 10 screens - but my eyes have been really opened since I joined the Elite 3.4S.

It is like moving from an Apartment into a Villa - and what is more, the Villa has a swimming pool.

But, as with all trading, one must first decide waht it is they want, and more importantly, what it is they currently have.

What is thier purpose, what is their time availability, etc,etc,etc.

We all know the drill by now, but how many actaully sit down and drill thier minds, which is what they must do.

Inspiration is the big killer in trading -it creates a fog which is so dense that the majority of the time it is very hard to navigate.

This is not about what is the best way to trade, this is about who has the EDGE in trading Options, and in realising that the EDGE is with the WRITER, the next big question is, for anyone who may be thinking that this is for them, does this type of trading lend itself to my current situation. We all know it is not a simple choice - but in order to make the best choice, one has to have the FACTS.

A few of us, as you can now see, do not like it when the FACTS are not presented for people to choose freely - and this MUST not be allowed to happen - and that is why we are doing what we are doing.

The choice is always up to the individual - always has been, and always will be.

I will now take back what I said about Vendors in general - for, I am not afraid to admit it when I get it wrong.

But, as you well know, there are many Vendors that are only out for one thing, and that is to take money from unsuspecting customers.

I do not put Yourself or John in this class - both of you are, what I would call, decent blokes, and if I did offend you in the past, I now apologise, for it was due to my ignorance.

A wise man will always admit when he is wrong - and I can tell you now - BOY WAS I WRONG.

And the funny part about all this, is that one man, the man whom many called a FOOL, a stupid old FOOL, is in fact the whole reason why I changed my way of THINKING.

Socrates, I thank you for your guidance and advice, for you are indeed, a very wise man.

Thank You My GOOD Friend

 

[Profitaker]

Just when I thought it couldn't get any better ......