The same. The very first line of the book just showed they are not good traders. "If there was one article of faith that John Meriweather discovered at Salmon Brothers, it was to ride your losses until they turned into gains". That is the violation of one of the most important trading principles that we retail traders have to follow. "Cut your losses early and let your winners run." You do NOT keep adding to your losses hoping for a turnaround. If we had all traded like this guy, we would all be bankrupt long time ago. And this guy is supposed to be a trading genius?? The number 1 guy on Wall Street? LOL Just read the epilogue, it's fascinating to note that "Most of the other partners lost 90 percent or more of their wealth—that is, everything they had invested in the fund..." and yet, "most of the partners remained far richer than ordinary Americans". The big Nazi propagandist used to say "when you lie, lie big". I guess when you fail, it helps to fail big too. LOL I will read the rest of the book later.
yeah. Ltcm blew up because they were overlevered. We all know that. all else being equal, a smart person will be better adept at earning and managing risk than a dumb person. That’s why Goldman Sachs hires the smartest people in the world. The point of the book is: intelligence vs greed and over confidence. another example of the above is Raj Gupta of McKinsey or Martha Stewart and her insider trading.
This is not about smart or dumb. This is about looking both ways before crossing the street even though the light is green. Anybody knows how to do that. Meriweather himself knew to check the direction of the wind before betting on Chicago Cubs when he was 11 and he didn't know not to throw money behind losing trades?? LOL Anyway...
Essentially still a long vol. trade. If there is a vol. crush, he is screwed especially with DITM and so much DTE left...
Hard to say without knowing what percent of spot he is long..I cant find his post,but it sounds like he is synthetically long a strangle..I find it very hard to believe he has a 55% win rate being long OTM strangles,but I would need to backtest it... DITM options are not terribly vega sensitive..All we know is he needs a big move one way or the other,unless he is a master at trading gamma.. And he did say he trades with a delta..Not sure why a good directional trader would opt to trade strangles
@TheDawn Smalfil is a moron. You both are too smart to waste your time figuring out what he's doing in his fictitious Walter Mitty portfolio. Your time is better served butting him on block or ignore.
He's not. Like @newwurldmn said, everything is made up. There is no way he can make money with what he says is his strategy. As I rightly suspected, he's just a troll.
WSB has always been a cesspool of gambling degenerates using FDs to satisfy their addiction. a few years ago there was some talent that frequented, now it is 90% neophyte turd and 10% pump and dump shill...not even worth the sub.
No, my adjustments are not purely mechanical. For example, this week I had a ratio on in OXY. I ended up buying enough stock to offset my naked call exposure before it even reached the naked call based on what I see happening with geopolitical risk. So far, that was the right call. Normally, I would have adjusted the short call / sold puts, etc and attempted to avoid being long stock for longer.