[TheOptionClub.com] Re: advance adjustments

> Does anybody know how to do these adjustments, if so please show
simulations in TOS.
>
> 1. BUTTERFLY ROLL
> 2. ASYMMETRICAL BUTTERFLY ROLL
> 3. ASYMMETRICAL BUTTERFLY RATIO ROLL
> [you get the idea]

Isn't this exactly like one of those "Do my homework for me!" questions
that you see on technical forums all the time? Right...

In this context, though, I get the distinct sense that this list comes
from the marketing material for some sort of seminar or course, and that
the writer is curious but doesn't want to spend thousands to learn the
magic.

If so, he's probably on the right track. A mess of jargon like this
sounds to me like someone's trying to dress up some standard options
theory and charge a bundle for teaching you the exclusive, hidden
secrets previously known only to insiders.

Sure, people in this business love to give flashy names to their trades:
straddles, strangles, butterflies, iron condors -- I've even heard of
"centipedes" and "pterodactyls", for crying out loud. And a certain
amount of terminology is useful: it's easier and clearer to say, "I sold
an iron condor" than "I sold a call spread and a put spread with the
same underlying and the same expiration". But someone's really getting
carried away here. Who on earth would say, "Oh, the price of XYZ has
moved up; now I need to do an asymmetrical butterfly ratio roll"?

My suggestion: Save your money. Instead, spend it on some good books
(eg. Natenberg), watch the free videos at the CBOE (especially Dan
Sheridan's), check out the educational materials that your broker
provides, read forums such as this one -- in short, learn the basics.
If you understand vertical spreads, you won't need to memorize the
details of how and when to do an "asymmetrical butterfly ratio roll"
versus a "symmetrical iron condor non-ratio roll", or what have you.
You'll just look at what you have now, decide whether you still want it,
figure out what you'd rather have instead, and then make the appropriate
changes. No fancy names required.

At least, that's my $0.02 worth...

Martin

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