how to hedge 10MM via options?

Discussion in 'Options' started by itcanbedone, Dec 14, 2008.

  1. hi all,

    ofcourse, this is a hypothetical. it is for a neice in her business HS class.

    would some of you serious option traders detail a method a way to trade a 10MM portfolio via options.

    ETF SPY and Vix only.

    also, before u all yell at me and tell me i'm doin kids HW. don't yell!!

    she is already accepted into an IVY. sometimes a kid just needs a break.

  2. rosy2


  3. taowave


    You will need to define "TRADE" a 10 mm portfolio first...

    Do you mean hedge??

    Do you mean replicate???


  4. I assume you meant hedge...
  5. thanks for the qs.

    trade meaning.

    she is to trade the portfilio to generate cash/alpha by using options only.

    50% remain cash the the rest for alpha.
  6. MTE


    You seem really confused. First, you say you wanna hedge 10mil via options, then you say you wanna trade 10mil, now you say you want to trade half and keep half in cash.

    So which is it?
  7. is this some private hs for rich white kids or something? i never heard of a hs that teaches options. i took advanced placement econ in hs and we only learned stock basics.

    anyway tell her to google it and figure it out herself.
  8. thanks for the no help

    we are all available to bs and scream; but when someone needs genunie way!!

    it IS a private school and smart with tons of personal projects.

    the idea is how do to make $$ with options on a 10MM port. she elected to keep 1/2 cash and trade the rest.

    now she needs help. and fyi, me gonna send her a link to this thread.
  9. MTE


    Your request is ridiculous! You ask people to show how to make money with options. In other words, you want someone to explain his/her profitable trading approach/strategy that the person spent years developing, and basically just give it to you for free!?

    I'm pretty sure the whole point of the project is to learn something, so how is she going to learn if she wants served everything on a silver platter?

    So how to make money with options? You buy something and then sell it for more, or you short something and then buy it back for less. That's the whole science. As to when, how and what to buy/sell, well, that's the jist of trading.
  10. No help?

    You're a lazy ingrate. You didn't even bother to clearly formulate your question.

    You could have easily adapted the info at the link I posted earlier which explained how to hedge (which I assumed was your question from the thread title).

    Learn how to use google. In case you're to lazy to find it, go here:
    #10     Dec 15, 2008