grandma grew up in the depression, lived like it her entire life, was still convinced she had no money in her 90's left us millions. we maintain no debt on the commercial real estate, no debt on residential rentals, and no debt on personal residences. pay cash for regular cars honda/toyota. if you live like my grandma you have no stress because money was a means to security not happiness. joy was knowing you didn't have to work as a slave to build someone else's wealth. i don't drive a $80,000 car and i dress like i work in the fast food industry. expensive stuff attracts the wrong kind of people into your life. if you don't have a passion for finance why engage in it? if its only for the money do something else.
[Quote from cdcaveman: there is an inherent advantage to selling index puts relative to single name puts.... there are alot of dead single names, and the index is price relatively higher then its constituents put together] Is SUM of constituent IV not always > to Index IV ??
That's what i was trying to say on some of the individual names i sold puts on. Then a few posts later someone said the exact opposite I don't know what to say to that. If the data feed i have on IB is correct is was showing high teens/low twenty IV on large caps on very low teens IV on index like spy. It's obvious there is an inherent advantage to selling puts on index in that you get instant diversification, liquidity, more flexibility in strikes, dates, etc..but I didn't see higher IV as one of them. I was thinking the only advantage i get selling puts on individual names is pound for pound i'm being paid a little more for single name risk.
selling index volatility is more profitable than selling single name volatility because you are taking on an extra risk. you can call it tail risk, correlation risk, macro risk or whatever. selling index vol (otm puts or calls or ats) is profitable. and not just in the "make a lot then blow up sense". this is something of an overblown meme (the whole black swan bulls**t or the BSBS). you will have drawdowns. but there is no law of nature that says you will eventually blow up. you might. but you can also lose all your money being long and the actual evidence (you know, real studies with actual numbers and stuff) points to the edge being with the shorts. single names or the other hand are more mixed. there is some evidence of a volatility premium but it isn't as clear. and when selling cash secured puts or covered calls it is this premium that will make you profitable in the long run.
Fillthy, Is it more profitable to sell naked index put or to be naked short vix futures? Or is it similar?