Gamma scalping:what volatility are you trading?

your'e short the fat strangle and long the cheap wings,you take one of the wings off during a big move or one of the fats, you take both the wings off intrady in chop and let the strangle erode,you have to babysit

 

don't trade 8 legs when 2 will do.

What are you really gaining in two butterflies? A long calendar has a capped loss like a butterfly swap.

 

what is a fat strangle... are you referring to my iron fly calender with the rest of your comment? isnt an iron fly calender basticlly a subsitute for a long calender straddle.. such that you aren't margined out on the short straddle in the front month

 

so simply jog in and out of the short on one long calender...........

what about the synthetic short long stock jelly roll.. thats four legs instead of eight..
you know i'm not trying to simplify this such that i can gamma scalp two legs really... i sort of realize that makes that most sense..actually i didn't realize that fully till you said it.. but it does make the most sense for a small acount.. and actually i'm definitly gonna try that haha..

its got a nice defined risk aspect.. theres no buried margin risk... if your trading otm calenders.. you have liquidity.. you could literally short strangle the front month , long strangle the back month and walk the legs on and off based on action.. does one calender make better sense then two?

i'm actually trying to get a better hold of more complex positions.. i totally realize that commissions and bid and ask spreads make super obstacles the more legs.... i know everyone likes to bottomline things.. but if i don't completely understand the concepts.. i can't visualize how to exploit moves, term structure, etc..

 

Start with 2 legs only. Straddles or strangles. Forget calendars because scalping is not linear there
Keep it simple

 

so straight buy premium.. leg in and out of the winning or losing side based on direction? is one leg better to leg out on?. for any reason? leg out of winning leg on big surge up when that call gets over priced.. then buy back in when the underlying stops and that call flattens back out.


i like the idea of being long vol in a strangle... cause sometimes you just get lucky and theres a blow out.. or announcement

 

It depends. If I am still in accumulating mode, I will short stock when underlying goes up and buy more options if it goes down. Vise versa for existing position. I am trading strictly events, so taking some “advantage” on skew

 

I buy a straddle. and then if accumulating mode, add options to delta hedge. when in unwinding sell options to delta hedge. when i can't sell anymore i move to a new strike or cut the position.

works real well when stock is bouncing around. not as well when it gets trendy.

 

I hate being long vol.

 

cause you can't take alot of losses... most people hate it... it doesn't pay you regularly.. it hurts you a little bit everyday.. like Chinese water torture! haha