From novice to riskarb...

Discussion in 'Options' started by candletrader, Apr 13, 2004.

  1. Too much posing oil??
     
    #81     Apr 14, 2004
  2. nodelta

    nodelta

    Actually, not enough.

    :eek:
     
    #82     Apr 14, 2004
  3. pls take your slap fight to the yahoo fag forum. ask james stock for the url. :p
     
    #83     Apr 14, 2004
  4. quit stinkin up this board with your high school-ish crap :-/
     
    #84     Apr 14, 2004
  5. Nothing beats posing oil when trying to grapple with the Greeks.
     
    #85     Apr 14, 2004
  6. We're all buds here... but yes, we should stop or Candle's thread will be relocated to chat.
     
    #86     Apr 14, 2004
  7. nitro

    nitro

    I thought it was a crowbar that you needed to seperate the men from the boyz in Greeks?

    nitro :eek:
     
    #87     Apr 14, 2004
  8. SumJurk

    SumJurk

    Hmmmm...I think the facts speak differently. Mr. Trester wrote his 1st edition of this book in 1977. The book is now in it's 4th edition, and to quote from Amazon..."One of the best selling options books ever."

    I read the book 15 years ago when I was just getting started, and I would highly recommend it.
     
    #88     Apr 14, 2004
  9. marc6001

    marc6001

    Without a doubt Baird is the book that truly explains the application of the greeks to trading strategies. McMillan and Natenberg defined the parameters but not how to use them to really understand the behavior of a position or possible adjustments. It's only after reading Baird that I understood Cottle - which is very funny in parts. Cottle's book is difficult because it assumes you have the knowledge from McMillan, Natenberg, Baird, etc (afterall, it was originally targeted at MMs). All books are a must have. I also include Hull in my library as he mathematically defines relationships between the variables and these help me to pick up some subtleties (I may have to brush up on my calculus to produce the various relational graphs of interest).

    The upside to this is that I am more confident in designing my positions and can readily analyses "complex" analyse. Mav is correct that you need to be able to trade the underlying to get the rewards. I'm still developing my system.

    Thanks Mav and Riskarb for your contribution on the board. You guys have definitely raised the bar for a number of us.
     
    #89     Apr 14, 2004
  10. nitro

    nitro

    I live this everyday, and I always find it funny when people use this "argument." If you can "read" the underlying and you are trading options in the very short term (not MarketMaking,) then the greeks mean almost zero and the only reason to trade options in this case as opposed to the underlying is to use leverage and/or because you have some other edge, e.g., execution edge or perhaps better comissions per leverage than on the underlying.

    In short, being able to read the underlying better than other traders would remove the need for the extra decision dimesions that options trading forces on you (given the exceptions noted above.) Why not just trade the underlying? If you are trading options in anything other than intraday time frame, then moving the time horizon to a "swing time frame" means the greeks become _even_more_ important.

    nitro
     
    #90     Apr 14, 2004