Very true, your edge is what you make and believe of it. It can go against you or with you. It's all about finding what clicks and becomes in-tune with you. I realized that no market analysis can really dictate the market to make you right. It's asking too much. I made that mistake before, and it was costly, I found that the more I try to understand the market, the more confusing and frustrating it became, it made me suffer from analysis paralysis. I found that the best thing to do is specialized in one trade instrument, one style, one pattern, that you can repeat over and over and over again. I see that as the only true edge. Someone's else edge may not work for you because individual human nature is very different in terms of tolerances of risk and what he is expecting to give to get in terms of reward. I think of it as if Warren Buffer used his strategy to value, and then buy and hold companies for many years to come to shake off the noise in the market, then that would be his edge. To a different Trader like me who wants to specialized in Options, that type of edge won't fit with my nature.
You can't make a career trading options unless you are trading volatililty. You can't trade volatility on a 10k account just on the fact that options trade in 100 share increments: 1 lot of SPY = $20,000. So you are automatically leveraged and then you are adding the "leverage" of options on top of that. What's your "business plan" here? What revenue/returns do you expect? What drawdowns do you expect? If you get them what will do you? How will you determine mispricings in the market? What makes those mispricings exist or persist?
Agreed. Making markets and hedging in options is no longer profitable from many Chicago trader's perspectives and is crowded beyond comprehension.
But somehow, some way, a lone retail trader with $10K is going to prove you wrong. C'mon, MarksmanII. Stop with the Warren Buffet comparisons. Your edge isn't "what you make and believe of it." You've read too much touchy-feely trading psych stuff. Your edge better be real and quantifiable, backtested and forward tested. "Hope" isn't a trading strategy. Better to give you reality and tough love than tell you what you want to hear. What you believe about trading is the equivalent of a magic diet pill that works wonders even if you eat junk food all day.
I have to see it for myself anyway, like other said, at least I have given my full effort to become a options traders. If it doesn't work out, I can always get a job. Yes, yes I know the opportunity cost of taking on this plan with a high degree of risk in trading options. It would somewhat made more sense to own 100 shares of stocks instead of using options given the fact if I had more money, but I take this from the lemon perspective. I find it funny that people expect you to know and use all these random instruments like writing options, open credit spreads, scalping to make money, gazillion market indicator, market analysis, know the market in order to be a professional. It just doesn't make sense, if we don't know what will happen in the next few minutes, why should we expect to predict what the market will do. I find this a strong fallacy. There's so many unknown variable unaccounted for, like fundamental analysis only give you a flat value base on valuation but it doesn't account for the subjectivity valuation of every other trader's decision on the same trade you are looking at. The only thing I believe in is probability. I'm looking to see if I can find high probability trades, that's all. Doesn't mean I'm guaranteed to win, I feel people expecting too much, to see you have big result or go-home type of mentality. I said I want to become a professional options trader, not expecting the market to give me money on the spot.
You are new at a cutthroat game. You are the prey, not the hunter. Most of what you shared is useless blubber, are you lonely? You should keep a job to replenish funds. Your goals are poor ie "I wanna be a trader" If you know all the answers, shut the F up. If you start a thread asking for professional advice, perhaps you should read and absorb the answers.
So what if I changed the personal number from 10k to 100k, to 1000k, and a 4 year living expense, would that make a difference? Would you have then give some real options trading advice. So far people are already confirming what I already know, or giving me non-sense like you are underfunded, gotta trade forex, go long stock, gotta trade using margins, again useless information. Nothing related to options trading, and You don't need to know my reason why I want to specialize in options. I feel you have no experience trading options before and just come here to rant or put down the other guy. I don't understand why you are taking it personal, like you expect the other person losing his money is suppose to be yours. It's very immature, like the guy who tells you, you can't do it just because the guy couldn't do it himself. I've trade options for a while, and have experienced all the unpredictable / possible things that could happen, stop telling me like every options trader out there is a loser. I was seeking professional advices from who had trading option with extensive knowledge from personal experience and to give me things to look out for. Unless you can provide constructive feedback or advice, please just walk away and don't even post, not even sure why you are getting mad at the internet, like an emotional trader.
MarksmanII You have to understand that you succeeding with your limited means ( 10k,...) will be a serious blow to some people ' egos ( who failed inspite of having the dice pipped in their favor). Now that said, why not try some prop firms that offer options trading. I think Bright trading does so. Again, the dhamma stuff is highly recommended : it will build a very objective mindset.
I gave you constructive feedback. And those questions would still exist at 100,000. You have posted twice without referring to them or answering them. You are the one being unconstructive at the moment. Good luck in your endeavor. This forum has dozens of threads with your story and the ending is always the same.
Have you been net profitable trading options so far? If no what do you think is going to change this fact ?