I consider Scott to be a buffoon because he attacked me and my character only because I pointed out he was incorrect in his collar assessment. I found his behavior very odd especially being that he is a staff writer for Optionetics. I act like a jerk sometimes but I don't work for ET or Optionetics. If I did, I would behave a little more professionally. It just blows my mind how the people over there have so little understanding of options.
Wayne, thanks for your response. My nature is such that I don't consider anyone's ideas as "invalid" and not worthy of consideration. That's why I consider myself to be privileged to be able to participate on both boards. 4Q
Indeed. It pays to keep an open mind. However, (and I'm trying to be as diplomatic as possible ) the idea that adjusting a BCS inherently more costly because of a greater number of commissions/slippage is clearly incorrect. Whatever strikes are rolled, in either strategy, will cost the same in either strategy. (assuming that the bid/ask spread is the same all round) People over there have gotten it into their head that a BCS cannot be adjusted as easily as a collar. That is just wrong. Cheers
Fair enough, Mav. Actually there isn't any justification for personal attacks on another individual's character, whether or not one works for a particular company or not. Over time both Scott and Steve have taken numerous shots at me. I have chosen not to reciprocate in kind, but rather to stick to the particular subject matter at the time. It hasn't been easy though. 4Q
We haven't addressed the liquidity problem. At the time when we need to adjust, the liquidity might not be there, and slipping cost might be high for a particular strategy. I don't know which is better. Perhaps they are equivalent. Normally stocks are more liquid than options. I wonder if Mav or other experts can address this issue from "liquidity" perspective.
Yes, that is a good attitude, of course. But the fact that something basic like synth equivalences is only inserted in the discussion by someone from outside, and only then discussed and clarified, is stunning to me. You can talk what you want about options, and people have done so for the last 20 years, but to keep the discussions simple and to have some shoulders on which to stand, it is strongly advised to use synthetic equivalences as a starting point for every explanation about possible strategies. Not as some quirck that has to explained away. Anyway, I don't see the difficulty here. Ask yourself the questions: - what happens to a long call when stock is added - what happens to a shot call when stock is added - what happens to a short put when stock is added - what happens to a long put when stock is added - what happens to a vertical when stock is added Just draw the risk-graphs and see them switch from one to another. The nodes stay the same. Move a leg, see what happens to the equivalent leg. A collar has the same 2 nodes as the equivalent spread. How and why anyone would think moving these nodes is different in one strategy from the other is beyond me. I think they try to sell something old and chewn as a blinking new moneymaker. They're holding back the truth and they're asking money for it. It's clear bull/bear shit. Did anyone hear the sense of joy in the writing by Kramer in the part about the new margin rules. I my mind I saw already thousands of new suckers who now want to learn from optionetics how to use collars to increase their profits overnight. Halleluja. Ursa..
MajorUrsa, on the Optionetics Boards the subject of synthetic equivalencies has often been discussed. On Scott's Board there is a lengthy thread I started around Thanksgiving time. It deals with AAPL. I was explaining to Scott that I have been using a reverse collar with a calendarized twist. It wasn't too long before Alex Mendoza jumped in and pointed out to me that what I had was merely a synthetic calendar spread. He was absolutely correct. I understand his point. However, because I am continuing to make a profit doing what I had been doing, I merely thanked him and stayed the course. And I sincerely thank you for your comments here. 4Q
Allright, that is good to hear. My impression was they had no intention of simplifying matters, as is mandatory imo when handling options. Still, it mystifies me why the current equivalence is so sluggishly admitted. This argument about the vertical being harder to move around is soooo farfetched. Ursa..
Would you be interested in discussing your reverse collars on another thread? If so, I will start one. I tried a couple without success.
Eliot, I'd really like that. But, just so you know, sure I really like them, but nobody should take me for an expert on the subject. Happy to discuss it but not at all interested in any sort of a debate whatsoever. 4Q