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That's tough to do. Not much into TA more fundamentals of the long term market, but it is important to sell on a down day or when the VIX has bumped higher
Big difference between short selling and selling puts but I know what you are saying
Volatility is good for the market and trading.
Preservation of capital is the most important concept for those who want to stay in the trading game for the long haul. - Van Tharp
I don't do short selling, just shorting puts and calls as sketched above (--> Short-Put)
If you only sell puts, sure then a down-day can have positive impact, but imho often inviting too much unnecessary risk. Ordering the first lot for me would be fine to scale in but bigger moves can gain a huge momentum running far. I don't want to short a put at such an early stage. Too often waiting for such trades to have only a decent ROI and a lot of them actually need to be bought back to follow strict risk-management. Following the swings the ROI is way better and if not then the mid-term-trend was estimated wrong. I know lots of people do their options by just referring to numbers which is fine and has a long history but having a small edge (isn't that what we all are looking for) recognizing a hidden divergence, a shifting market, that can be worth a lot. Blending such possibilities out is (for me) like driving a car with only one eye.
That's interesting. If hidden divergences and swings is working for you that's great. I'm always open to new ideas.
But I can only speak from my experience from trading since 2004, and for me it works until it doesn't work anymore. I have looked all sorts of indicators, divergences, swings and none of them have provided any sort of long term edge for me.
I'm not advocating just looking option prices, greeks or ROI, but the market fundamentals(unemployment,consumer spending) and for an equity (quarterly, annuals) are very important.
IMO a chart is view of the fundamentals, Sure there are certain prices where buyers step in or sellers sell but trying discern that (long term) is very tough to accomplish IMO.
I understand what you are saying but the risk profiles are different for shorting a stock than selling premium.
Volatility is good for the market and trading.
Preservation of capital is the most important concept for those who want to stay in the trading game for the long haul. - Van Tharp
Ron's ES trades are terrible idea, He would have lost millions during Aug 2015 (if his trades are even legit). Leveraging that much and worrying about SPAN margin is all around bad idea.
Volatility is good for the market and trading.
Preservation of capital is the most important concept for those who want to stay in the trading game for the long haul. - Van Tharp
Ron99:
"BTW I just calculated my days held average for 2017 and it is 27.3."
Did you ever calculate how many millions you lost during Aug 2015? You had over 750 /ES options open at the time VIX spiked to over 50. Tell the truth and be transparent
Volatility is good for the market and trading.
Preservation of capital is the most important concept for those who want to stay in the trading game for the long haul. - Van Tharp
With stuff that seems to be trending higher (relatively reliably), do you have a hard time with the short call side if you're doing IC's?
It seems like if you select your short strikes using delta, often times you still run very close if not breach the short calls anyway.
Perhaps these recent couple weeks aren't the case, but since we've had such low volatility and generally grinding higher, I find that putting on IC's is incredibly frustrating in this environment given the low(er) premiums associated with lower volatility.
Haven't traded IC's in years. That's is the problem with iron condors. I have traded calendars, diagonals, condors, ratios and none have been as profitable as selling puts for me.
Volatility is good for the market and trading.
Preservation of capital is the most important concept for those who want to stay in the trading game for the long haul. - Van Tharp