Long some skew = 52 strike vol slightly > 53 strike vol. Downside strike vols increase as their deltas decrease -- therefore long delta = long skew in index markets. Vols are bid into macro events. It rarely pays to buy vol into these events unless you're flattening your deltas with shares or another option series after the event. Price moved 2-sigmas, but you inverted deltas. QQQQ started the day $.55 above your strike. You started the day long deltas, long gamma, long skew and strips. A bull move would've accumulated more deltas -- you wouldn't have seen your deltas flip-modality; +/neutral/-, as the Q's approached/breached the straddle-strike. This [inversion] always hurts if you're long gamma. Skew meaning volatility-by-strike; and an upside QQQ move would've increased strike-vol, net of a loss to aggregate volatility [strip vol]. The position dissects to long deltas as being the leveraged win. Gammas are decreasing with vols, and strip and skew exposures offset.
I shut off my PM's and email because of the time involved, and prefer to answer questions in this open forum so others can jump in. I wouldn't pay for any options education, but if a free seminar shows up in your area I would go but not sign up for anything, you might get something from the freebie part of it. These EliteTrader option forums would be the best place to learn option trading along with some simple trades like this QQQQ straddle that you are in. Try InteractiveBrokers if your current broker fills you outside of the bid/ask range a few times. Even my market orders sometimes get filled in between the bid/ask with IB, they are very good.
I think you might want to be a little more careful in regards to whose advice you take. This is just one example of what happens when you don't want to pay for an education: "forex-forex Registered: Feb 2006 Posts: 892 05-14-07 08:09 PM SBUX - Just bought 100 contracts June 30 Calls at $0.50. Should be easy money." AND "forex-forex 09-08-07 05:34 AM After MY SBUX trade I took time off and just finished blowing out my account a 2nd time to the tune of $30,000, this time with calls on ICE. SBUX down over $10,000 and now ICE another $30,000 loss. I GIVE UP." Loses $40k and still doesn't see a need to pay for some decent education: "forex-forex:I wouldn't pay for any options education" Not even a book . db
daddy'sboy...read my reply to snugglepuppy666 about advice through PM's and emails, it's in the post above yours. "I shut off my PM's and email because of the time involved, and prefer to answer questions in this open forum so others can jump in."
That's right, you want to answer questions in this forum and that's why I was commenting on your advice: " I wouldn't pay for any options education, but if a free seminar shows up in your area I would go but not sign up for anything, you might get something from the freebie part of it. These EliteTrader option forums would be the best place to learn option trading along with some simple trades like this QQQQ straddle that you are in." You did offer this advice, no? It creates the impression that one can learn to trade options successfully without having to pay for any educational material. That is what you said. Or did you mean you can learn to trade by attending this board like you and tradingpilot's fascinating trade discussion, lol. I would suggest that you both start boning up on some option fundamentals. This board has really taken a turn for the worse. I rest my case . db
You have made two posts to this thread yet no recommendations for books or educational material. So I will bite: daddy'sboy what books and/or educational material do you recommend? Can you give an answer in your third thread, or do you want more prodding? Or do you need more Google time to come up with some recommendations?
Look forex. I'm tired of repeating myself on this board. I used to post a lot, now I couldn't be bothered unless someone writes some outrageous nonsense like you did. If you want to know what you should be studying then you can search this board or my posts. Enough is enough. Cheers db
You should read this thread more carefully before you post. I couldn't care less about your old posts with recommendations for study material, the original poster is interested and I gave him my opinions on the subject. Do you need a fourth post for your recommendations? The Google link in my previous post should help you.
Don't you have any opinions on the QQQQ straddle or educational material? You got pissed off because I had a request to PM someone with additional information and you decided to try and discredit me by searching through 900 of my posts for some dirt. How long did that take you? 15 minutes? 30 minutes? 60 minutes? I'm an anonymous person on a public forum your time would be better spent doing something else, don't you think? Do you need PM's to make you feel wanted? You have never recieved a PM before and you wish someone would send you one? What's the problem daddy'sboy?