Tomaz, You seem to be a nice guy, but that's a negative gamma vs Vega spd, from a risk analysis perspective
You're talking about these guys? https://www.optionnetexplorer.com/ They just updated the current rev. mid 12/2019 and I'm currently using the beta version of the next rev. In fact recently contacted support and you have to manually pay when subscription comes due - no auto pay
https://www.elitetrader.com/et/threads/writing-options-for-a-living.53037/page-105 Here is a great thread (atleast the first 50 pages or something) for everyone thinking that selling premium is easy buck. Filter all the shit from the clueless ppl and pay attention what the veterans teach.
It was really really hard to stomach the decays, and watch the majority of my long OTM calls/puts expired worthless. Buying OTM one acts like a venture capitalist.
Yep, that is why it is hard to listen to Taleb and use his approach. You know that buying OTM put or call or whatever will eventually pay off, but looking at the psych perspective this is why selling OTM puts is so addictive. You win day after day after day. And if you have that type of personality where you hate to be wrong and hate to loose and winning makes you feel good (endorphins and that stuff), it is easy to see why so many people choose selling deep OTM puts as their way to make money. And everyone thinks they will be able to escape before train comes… As for buying OTM calls or put, it is vice versa. You loose, loose, loose, loose, and if you are patiently enough you will eventually win and hopefully if you pick the right moment/size you will get everything back and then some..
Curious, does Taleb anywhere suggest a 'specific' approach of just buying OTM options? Or is that assumed to be his approach based on his comments of them being undervalued? I would find the former extremely surprising.
I searched for that a while back and did not find anything specific. Just "barbell" analogy and that you should if anything to do with options buy tails. Or sell ATM and buy wings.. But that is far easier for someone that has 20 MIO of play money than for us mortals He is only concerned about keeping the money he already has and from his readings I think what he is trying to preach is that you cannot calculate tail risk in any way because there are unforseen black swans that can happen and that WILL happen if you invest long enough.. Also he advocates investing in things that can go up in hundreds of % and if they do not you only loose a small % of money. I think his reasoning is quite good. So something like bitcoin way back. You could invest a few k usd and this is the most you could loose, but you would be rewarded 100x if you did it early enough.. The problem I see with this is that you could also loose a few k here, a few k there and if you do this enough times losses start to add up. Other thing where you can really strike it reach is stakes at developing companies etc.. If you are an early investor that is. Or startups. Or your own company.. Small % risk, big pay-off and 90 % of your money in safe "investment". Hope someone else can chime in on this, because I could not find any more detailed things about his approach.
I think he has this Universa fund that every time there is a crash makes a killing (If I recall this guy Spitznagel was on CNBC last February)