I don't think they were overly critical about your "Naked Straddle hedged" comment. I think they raised the question simply because as some people said before, they just don't like to see inaccurate information posted as factual for digesting by students of the market.
Dreamer, I am not attacking you. It's just when someone comes on this board and makes claims of making 200% to 300% a year doing anything much less selling naked options, it gets my attention. Then when you take it a step further by saying that you have no real risk and its easy to manage, that starts to stink up the place. Look, you new to this board ok so let me say this. There is a lot of crap on this board. Most of it is very entertaining to read. However there is an exception to that on these option boards. I can truly say that most of the people who post in these forums are very inteligent and post very worthwile information. We like to keep it that way here. If you are going to make a blanket statement like the one you mentioned, why don't you give us an exmaple of one trade, just one. Use one from 10 years ago if you want, make it as simple or complicated as you want. Show us one trade you were sold naked options and managed the risk. Once you do that you will stop being questioned by others on this board. But making empty claims won't get you anywhere. Like I said one trade. You said you wanted to contribute, now here is your chance.
maverick, My point in referencing the success I have had was merely to demonstrate what can be done, not bragging. Actually, one can do even better if they want to trade more intensively. As I have said before, I am not here to teach anyone anything. By posting my trades, I would be teaching and that goes against my grain. I have put in too much effort and time, not to mention the normal failures I experienced before finding an order to the markets, to just give it away. Nor will I sell it as it is worth far more to me trading it than selling systems and/or books. Suffice to say, I trade in the equities, options and futures markets and my trading methods are based upon writing naked options in such a way that my portfolio is balanced against catastrophic events, either broad market or more narrowly based. If you want more information than that, you will have to work it out for yourself for that is the extent of my contribution on my methods of trading. Good luck trading to all, Bob on Whidbey Island "Don't confuse effort with results."
I think the key is trading this over a portfolio of hundreds of positions to minimize "event risk". Although I don't agree it is, or could be "risk free"; I think the risk is acceptable if done right. I don't doubt someone could make 200-300% at all ...
That is the range of annual returns for the last 6 years on my total trading account values which includes all margins required as well as reserves sufficient for protecting my portfolio. Last year, my total return on all accounts for the year was 268%. My best year was a little over 300%, that was 3 years ago. I have not had an unprofitable month since starting to trade my current methods and regularly take time off from trading for vacations and cruising on our boat, though I must admit that I still trade a bit when cruising and sometimes even when on vacation. If it seems as though I am trying to impress anyone here with my successes, I am not. It would serve me no purpose as I am long past the need to justify or prove myself to anyone and none of you know me. My son is the only one I am teaching my methods to and he is seriously sworn to secrecy. If too many traders used my mehtods, my results would suffer. You all should know that. Tis why none of those that trade in such manner will write a book about it and I can't believe I am the only one. Good luck trading to all, Bob on Whidbey Island "Don't confuse effort with results."
There are no such things as secrets in options. And yes there have been hundreds of books written about selling options. Options haven't changed in 30 years. You want to know what guys do on the floor. Go ask them, they will tell you. Why? Because it's no secret what they do, they just have the advantage of earning the spread, seeing the order flow, fading the order flow they don't like, and no capital limitations. Oh, also dirt cheap transaction costs. But they aren't doing anything secretive. I don't know why there is this myth that goes around on forums such as this one that there are these magical secrets out there and once you discover them you will be wealthy beyound your wildest dreams. Look 99% of the money made in the mkt, in any mkt is made in one of two ways. One through order flow information and two execution and cost of execution. The other 1% or so comes from pure speculation. Everyone and their brother knew what LTCM was doing, it wasn't a secret. They could just put on their trades much cheaper then anyone else and got financed better then anyone else. When you study options you learn there is only so many things you can do and none of them are a secret. In fact, somebody correct me if I'm wrong but has there been any new strategies in options since the call options started trading in 1973 on the CBOE. I don't think so.
Metooxx, I thought this is what LTCM did. Only they diversified over thousands of positions not hundreds. In fact I think they had over 30,000 positions if I remember correctly. Of course in times of panic, Everything seems to move in the same direction, against you, and quickly.
Puzzling ! We will try hard to find out !!! One more question to Dreamer : You make directionnal bet or no ? If yes it seems impossible not to be wrong from time to time !! If no it seems impossible to reach this level of reward !!
Maverick, I have no desire to continue to do "battle" with you over this matter. You are obviously convinced you are correct and I am willing to leave it at that, in that you are so closed minded. While there may be no "secrets" in options, there are many permutations of using all that is available in devising methods of trading that are highly successful. While you may possess all of this knowledge, I am quite sure that many do not or they would be trading such. Are you? As far as correcting you regarding "any new strategies in options since the call options started trading in 1973 on the CBOE", much has been added to the equation since then. I have no interest in "correcting" you at this point, but you can easily determine it for yourself.