Why pretend. It looks like I fell for your parody hook, line and sinker. But let's not focus on those of us who fell for the parody, but instead focus on yet another of your many talents. Good job, Mo
I was out all day at parties and could barely read the computer screen with one eye open. Last night at the time it looked like MO cracked the DaVinci code to me. Okay, rational thinking in settling in now, it looks pretty hilarious today, LOL. I asked the mod to delete my response but I guess it's up there for all eternity and posterity.
I think Mo's post is yet another example that basically people have an inherent need (at the DNA level) to look up to a guiding figure... More importantly, I hope Germany crushes Italy. Germany 2 : Italy 1 France 2 : Portugal 0 France 1 : Germany 0 (in sudden death OT)
Good sports you two! Before I get any more PM's on my strategy to quadruple account in three months, I'd like to re-emphasize that my post was a joke. Untrue. Made up. Fabrication. Fiction. Tall Tale. Fish Story. Flight of Fancy. A Yarn. Bunk. I should start a website..."For only $499 I'll show you how to..." We digress...
OK, when I saw your post I thought to myself "as for typical beginner psycho-trader the man has damn good knowledge. Well, exceptions confirm the rule". But if it was not a joke, I wouldnt bother with reading you any more.
The lottery ticket zone is bigger than 25 points even though the short and long strikes are 25 strikes apart. The profit zone is actually 50 points wide if you ar elooking at the 1200/1175 put ratio spread. Be careful of 1:3 spreads as you have more naked options and an increase in the risks that come with naked options.
I second that. Also, scoobie bear in mind that it isnt a lottery ticket per se until you have adjusted to a fly of some sort and/or bounded the risk. With these ratio spreads, you dont want the market to move towards your strikes. Sure, you have a wide profit zone but you see the same effect as you see with a fly, the gains happen very close to expiration while you still carry the unbounded risk throughout the trade. (The 1:2 ratio spread is a straightup fly with one wing) Sure you can increase the zone but to receive a comparable credit you must go closer to the market or steepen the ratio, both of which carry their own risks. Having a wider profit zone at expiration really shouldnt be your focus with this trade. The whole lottery ticket concept that phil mentioned applies to traders who favor adjustments in certain situations and like leaving small amounts on the table for that big payoff that might come once in a while hence the term lottery ticket. it isnt the main goal with the trade. There are other much less risky positions you can open to capitalize on a SET within a certain range. Just my 2 cents.