Blackjack, Look dude, I have been doing this for a long time with a proven track record. There are risks in every type of trading strategy and everyone has their own tolerance for risk. There are always those people who can't handle the success of others, and you are one of them. Your negative attitude will always keep you from ever being successful in the market. You show me where any wall street guru or trading system seller will post their actual statements to backup their claims. NONE WILL!!! Where is your Blog?????
whoa.... fm757....blackjack was most likely not flaming you. he was simply speaking the odds. you even got a compliment on the wire outs. my own 2 cents ..i trade very similar to you, wire funds out for a living; but i diverge from you as my options trading has evolved over the years to include far more than selling premium. returns have not diminished from the naked days. your blog is interesting; but rest assured that some guys who talk about option trading are not full of shit.
From blog "I have been trading S&P500 futures options for about 5 years now." From this thread "Look dude, I have been doing this for a long time." Interesting how new traders think that 5 years equals a long time. That is pretty funny. What is really interesting is there are few people on this website who can actually give you worthwhile constructive advice, but like so many new traders that haven't traded through 1987, LTCM, the Asian currency crisis, or the dot com run and bust your ego prevents you from actually listing to them. As I have posted in another thread, the VIX went from 36.37 to 150.19 in one day 10/19/1987. With a gap down and VIX going about 4 fold against you, what exactly is your risk management for a situation like that if you are naked short puts? You assume that will never happen again because you have been lucky enough to not see any gap moves over the past 5 years?
Thanks for the replys guys, but I did not start my blog for everyone to do a risk analysis of my trading. Just don't read it if you don't like it. Simple. I think I have 2 reason for blogging. First, just for my own personal journaling of my trading and secondly, the wall street scaming machine just pisses me off. People will pay thousands of dollars to buy someones system or methods without insisting on proof that the person selling it can even make money. I am guilty of this myself. Also, I know that know one can mirror the results of someone. I am not expecting anyone to piggy back on my trades and if they do they are stupid and will lose lots of money. I do not have anything to sell either. It is just a personal blog and if you find it interesting...read it.
You said you have been trading what this thread and your blog is about for 5 years. That equals a new trader. If you have been trading other things, that is not relevant to naked premium selling, are you saying you lied about only trading this style for 5 years? How did Niederhoffer do with selling premium? Ansbacher has been doing it for a long time, but unlike you, he has very strict risk guidelines and goes for a very reasonable return. You act like what you are doing is unique. This exact topic has been discussed to death on this site. Having managed tens of millions of dollars of short index option positions I know exactly what you are doing and why you are doing it. It is just a shame that you won't realize that there are better and less risky ways to use your trading talents.
what is good about et is that it can bring retail traders together with professional traders (although, i do not know what pro's have to gain). i am a retail trader who started out 12 years ago with simply selling premium otm. luckily i have family who became professional option traders in nyc and also meeting a few "real pro's" here; i migrated to more directional trades like fly's , and ratio's. well said; it may sink in after a few more years or a near blow out. opt, would you say you earn with net premium (ie: no unbounded risk) sales at this point in your career?
That is the point. Many long term successful traders have tried misguided strategies (like selling OTM naked options) and then they learn there are better risk/reward trades that can work in the long run. It is clear from the OP's attitude that he will be one of the many casualties eventually. Realistically there are no "unbounded" risks, and anyone long stock has basically the same risk as a naked short Put, but if you have on a position that could wipe out most or all of your account with a move that has happened in the past then your are doing yourself a disservice. So you have to take risk to make your reward, the key is finding the ratio that will work for you in the long run.