Destriero - Butterfly Trades

Discussion in 'Options' started by ironchef, Dec 11, 2020.

  1. ironchef

    ironchef

    Does variance mean scatters or is it a precise statistical term?

    Also,
    I don't look at market direction when placing the body on single names, just from their own information, like charts....

    I have not scaled up, so far only a couple of flies a week.
     
    #531     Apr 24, 2021
  2. .sigma

    .sigma

    Var = vol = magnitude
     
    #532     Apr 24, 2021
  3. ironchef

    ironchef

    Update: Two more flies, both losers.

    Conclusion: It looks more and more like randomness + bull market rather than skills.

    What next: Unwind all my trading positions and retire from trading. Like a lucky gambler, I should not push my luck any further and should quit while I am ahead.

    I had a great run starting from 2009 until today. The only negative year was 2011. Investable capitals have gone up so much I don't need any more money.

    ET has been a great help and I wish all of you the very best.
     
    #533     May 4, 2021
    longandshort likes this.
  4. What makes a good trader good is their ability to stay focused on the trade. It makes sense to take a break when you feel distracted. However, based upon your record, I would say you probably have skill. Where you could improve is by figuring out a way to hedge out underlying beta. For example, butterfly’s pinning expected variance between your single name and a benchmark (or a pair). Another example would be managing your trade to keep it profitable (adjusting a wing, etc.).
     
    #534     May 4, 2021
    ironchef and .sigma like this.
  5. qlai

    qlai

    Is this goodbye?
     
    #535     May 4, 2021
    .sigma likes this.
  6. caroy

    caroy

    congrats on your successful run
     
    #536     May 4, 2021
    ironchef and .sigma like this.
  7. easymon1

    easymon1

    Congrats.
    Let us know what you do with your newly freed up Time.
     
    #537     May 4, 2021
  8. .sigma

    .sigma

    the virtuous man has spoken

    I wish I could lose on two flies and retire lol
     
    #538     May 4, 2021
    taowave likes this.
  9. Compare the following payoff matrix of a bullish structured iron condor to owning the underlying. The right most % column represents the return on the underlying for a given price. The other numbers represent the estimated return on maximum risk for the iron condor based on price and date:

    upload_2021-5-4_21-1-10.jpeg
    http://opcalc.com/ue9

    Notice the leverage, the profit range, and the fact this is a defined risk trade. My guess is you could find a way the make options work for you if you really wanted to.

    In any event, best wishes to you.
     
    #539     May 4, 2021
    ironchef likes this.
  10. .sigma

    .sigma

    youre giving this advice to a guy who’s had 11 of the last 12 years in the green.
     
    #540     May 5, 2021
    ffs1001 likes this.