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 oldnemesis   Registered: Sep 2012 Posts: 214 10-18-12 05:56 PM Well that was even quicker. I know put-master's problem.... like most trolls he has no life. Here's an idea... If put master contests that table he should post a corrected one... instead of slavering out argumentum ad hominem. ...................Cash Return................Required Margin.............% Yield.............. Price.............put...........Spread........put.............Spread..........put............Spread.............Probability 30................(635).........(175).........3,635............174.............(17%).........(100%).................99% 35.................(128).........(175)........3,635.............174............(3.5%)........(100%)..................95% 40..................65...............26..........3,635............174..............1.8%...........14.9%.................50% 45..................65...............26..........3,635............174..............1.8%...........14.9%..................8% Short Put Expected Value = .5(65) - .05(128) - .01(635) - .44(381) = 32.5 - 6.4 - 167 = \$-141 Spread Expected Value = = .5(26) - .05(175) - .01(175) - .44(175) = 14.3 - 8.75 - 77 = \$-71.45 This is not a remarkable conclusion it simply reinforces the nature of the trades and is well known and understood by (almost) everyone who trades options. You can read this exact computation in any of McMillan's books :-) hey here's a place where PM could actually be of use: what's the plural of argumentum ad hominem??? Edit/Delete • Quote • Complain
 Put_Master   Registered: May 2009 Posts: 1029 10-18-12 06:19 PM The example and tables oldnemesis (DanShirley), posted for discussion, are all either useless, meaningless or stupid. Only DanShirley would want to draw investors into such a ridiculous discussion. I'll just read in amusement, if others want to participate in Danshirley's (oldnemesis) discussion. As always, I'll allow him the last word, as he will keep this silly banter going for weeks if I don't. Edit/Delete • Quote • Complain
 oldnemesis   Registered: Sep 2012 Posts: 214 10-18-12 07:27 PM Will Put_Master really give me the last word.... can he control himself that much?? Lets see. The table we are talking about is: GIS April 37 short put vs April 35/37 bull put spread (9:30 Am Oct 18th) ...................Cash Return................Required Margin.............% Yield.............. Price.............put...........Spread........put.............Spread..........put............Spread.............Probability 30................(635).........(175).........3,635............174.............(17%).........(100%).................99% 35.................(128).........(175)........3,635.............174............(3.5%)........(100%)..................95% 40..................65...............26..........3,635............174..............1.8%...........14.9%..................50% 45..................65...............26..........3,635............174..............1.8%...........14.9%..................8% Short Put Expected Value = .5(65) - .05(128) - .01(635) - .44(381) = 32.5 - 6.4 - 167 = \$-141 Spread Expected Value = = .5(26) - .05(175) - .01(175) - .44(175) = 14.3 - 8.75 - 77 = \$-71.45 Which he says is ... what ...useless, meaningless, stupid etc. I hope not. I construct at least a dozen such tables a week and make most of my trading decisions based on such tables. Edit/Delete • Quote • Complain
 failed_trad3r   Registered: Oct 2009 Posts: 1615 10-24-12 01:57 AM Yes, now is the right time to write november puts. look at the skew! December future is almost the same as november and its way to high at 19!. November VIX will come down and you can have some free premium. http://vixcentral.com/ Edit/Delete • Quote • Complain
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