trading VEGA

Discussion in 'Options' started by jenek-cowboy, Oct 16, 2007.

  1. is it also read
     
    #11     Oct 16, 2007
  2. cvds16

    cvds16

    your english is not too great, I don't understand what you mean, sorry
     
    #12     Oct 16, 2007
  3. in Russia we use stradegy which give profit as time disinteration with rolling.Nadeyust I understandable dialect.And we turn our effort to make a system oriented on trade IVO for deversification
     
    #13     Oct 16, 2007
  4. cvds16

    cvds16

    if I understand what you mean (I'm not quite sure about that) you certainly need to read those three books.
     
    #14     Oct 16, 2007
  5. i mean :this is already read
    I am sorry
     
    #15     Oct 16, 2007
  6. cvds16

    cvds16

    are you sure you understand all those three books, if you do trading vega should be no huge problem whatsoever on any stock wherever in the world.
     
    #16     Oct 16, 2007
  7. cvds16

    cvds16

    Real vega-traders don't just sell or buy stradles and strangles they also delta-hedge, to do this properly you need an optionmodel.
     
    #17     Oct 16, 2007
  8. all methods that we know based on analisis an index on IVO.It is Correct this?
     
    #18     Oct 16, 2007
  9. cvds16

    cvds16

    What do you mean by IVO ? Implied volatility ?
     
    #19     Oct 16, 2007
  10. cvds16

    cvds16

    For what it's worth you don't need to know historical vol to trade vol, although it might help. As a mm you can for example sell high vol and buy vol in different strikes and ofset your delta's, you can trade vol in different calender months to ofset your risks.
    As a trader (I don't trade options much anymore) I used to sit on the bid and the ask of options on DIA (the tracker of dow jones) and hedge my delta's and go along with the flow. If I saw people were buying options I adjusted my vol in my model and adjusted my prices accordingly, if people started selling options I did the reverse. I was making prices in 20-30 strikes. I didn't have much of a view on vega, I just went with the flow.
     
    #20     Oct 16, 2007