you sure you want to be short gap and gamma going into the holiday season? What do you mean? Do you think market will go up in 3 weeks or down? I mean in the holiday season.
I'd not venture a guess which way it's going to go. Historically, gamma is allways cheap across year-end, as there is a lot of willing sellers. At the same time, it is the time of major announcements and various other vol-inducing events.
I'd not venture a guess which way it's going to go. Historically, gamma is allways cheap across year-end, as there is a lot of willing sellers. At the same time, it is the time of major announcements and various other vol-inducing events. I think everyone is guessing (speculating) when he enters a trade. I don't believe short term (daily or hourly) speculation is easier than longer term speculation. Since I am one of those traders that does not have a good taste in short term guessing, I trade on options. I had already sold naked Call for ADI 40. I sold PUT 35 today. I don't know where ADI will be tomorrow but I am willing to buy it at 35 and short it at 40. That is why I had those trades. All my trades are like that. I have 21 positions open as of today and my portfolio is up 21.34% this month. I had one losing month this year and that was October.
I don't want to scare you (too much ) but did you calculate what your positions will do if all your underlyings move against you 3, 4 or 5 sigma? Small probability doesn't mean impossible ...
I don't want to scare you (too much ) but did you calculate what your positions will do if all your underlyings move against you 3, 4 or 5 sigma? Small probability doesn't mean impossible ... You ARE scaring me. Seriously. stop it. Ok I won't short anymore.deal?
I just finished it. It was a great book. I learned a lot. It does not use your brian.It is like a story.
If you are saying that you are have fundamental opinions on the underlying, you should be trading the underlying. The point of trading in the options is that you can express directionless opinions and the actual traded asset is the volatility of the underlying. You are hoping that ADI (whatever that is, I don't deal in equities) will stay in place and in a pretty narrow range (5 bucks). In other words, you are a seller of gamma, mainly in the form of strangles. What is your "disaster" plan? Are you delta-hedging or you actually have enough capital to handle an asignment on all of your positions at the same time?
To CNMS2 - I bought that options "bible" and what a book! It just arrived in the mail and now I see why it cost $105. It'll be a while before I finish it if I don't skip all over the place in it. Thanks for the rec.