couple thoughts for all the friends of Karen in this thread -- it's hard to dispute that there is positive expectation in selling risk premium and the more assymetric the p&l profile, the bigger the premium. If you have the ability to stomach the assymmetric return, you have an advantage and can be a liquidity provider to the instutitional players that are forced to keep an eye on their return metrics (e.g. a down 5% week would not bother a retail investor, but it could get an institutional PM fired). -- keep your eye on the two "L". Most risk premium sellers (in any form, S&P options, CDS, OTR spreads) lose money not because they are wrong, but because they get greedy and either sell too much (Leverage) or sell it too cheap (Level). If you can work out the limits and general risk management approach to handle the leverage and can figure out how to price the risk, you can control the two "L"s. -- Divesification is your friend. You are always better off underwriting idiosyncratic instead of the systematic risk, but you need to understand why this lunch, while not free, looks cheap. You can hedge the book by buying vix options or spx options or some sort of etf options. Modelling gets more complex but the results are nicer. -- In an ideal world, you could do what I do, find very rich risk premiums and hedge them with cheaper risk premiums. I have probably done better for my employers then Karen did for her investors, making money even in the hard years. It's a lot of work, though.
1. FX traders are gamblers (at least for me). I wonder how they articulate the probabilities of profit on their trades? What Karen do is not gambling. 2. Name 1 person that turn 1 to 100M from lotteries and gambling, please. 3. Well if there are your criterias of a super trader, well some of it i do agree but some i don't. For me consistently beat the market at many market cycles for long time is not argueable, but along with that result, i do expect more DD than the market sometimes. It's okay for me as long as the trader can create a trade which strategically suitable with the current market condition base on the size of his or her account.
Are you fucking kidding me right now? You think you're going to look like any less of a newbie by making somebody else get you a time stamp in the video you were supposed to have actually WATCHED before flaming people about it? Start watching at 41:00 and continue watching until feel like dying from embarrassment. So you wrote several summaries on her interviews huh? You know, something tells me there isn't any useful information in those summaries. Did you even get her name right? I doubt it...
I do feel embarrassed because I was silly enough to give you a second chance. Since you forgot to give us a link, you failed the challenge and entered my ignore. :eek: In the future you probably want to learn to back up your claims... Have a happy life....
sle, do you do this within the same universe (ie single name equity, equity index, commodities?), or in between them?
Yup she lost 4.5% in August 2011 (4-5 million) but finished the year up 53% trading 100M AUM. Clear as day, what she said.
I believe her story is legit. If she is not a supertrader she is a better trader than 95% of people who are trading. A lot of comments talk about Karen blowing up in 2008. I don't think it would be the case at all. She might have had some losing months, but once the trend is identified (down) she might simply reverse her strategy and sell calls instead. She said she goes along with the trend, not against it and that's what the vast majority of traders does.
you cant make much reversing your strategy.. selling calls.. the premiums dont add up.. you have to go to close ATM and then when it reverses violently.. u will get caught.. there is no free lunch anywhere. Check out the premiums any time.. u will see.. puts have been on a roll since 2009. while calls. always pay u far less. and get ITM many a times. obviously u will say. this has been the case since 2009. but my point is. everyone has factored this in.. and premiums on the call side are pathetic..!
Legit? ... begs the questions - why will she not disclose her performance for 2008? - why does Sosnoff say that she really 'only started trading from 2009'
i think its better if we dont focus on legitimacy at this point. as another thread with maverick75 points out, in the last 5 years.. another of these strategies would make money.. in 2008, she coud have done some size control and got away. - she said she had tickets to mexico as a backup. haha . so now the point is- we know the strategy. the devil is in the details. would u do this and make the 30% which she is doing. google her strategy. u will find some groups where trader specifically are using her plan and doing all sorts of analyis and posting their live trades. https://www.tastytrade.com/tt/shows/calling-all-millionaires/episodes/140220_LJ-millionaires