Re: [TheOptionClub.com] Results

 

On Sat, 20 Feb 2010 01:25:29 -0800 (PST), Arthur Schwartz
<comedynight2000@yahoo.com> wrote:

>Dear Ricky: thanks for an  original trading idea.  First in your AAPL starting position should the plus and minus signs of the puts be reversed?  Second, the starting position is basically a short fly which makes money in either direction if the underlying moves enough.  Third, do the results take into account the loss on the wing that is not adjusted?  I'll bet the results would have been better if you had closed the wing that's not adjusted, at the time you adjusted the wing that is in the money......Joel
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There was a typo in the AAPL starting position, it should have been:
On 1-19, -200p+210p+220c-230c @ 6.70.

Yes, unless I calculated the profits wrong, I have taken account of
the not adjusted side. You are very correct that these results would
have been better if the non adjusted wing was closed at the time the
other wing was converted to a fly. However, the test was to try a
methodology to go for a risk free double fly position. I would be
very interested in seeing which methodology would do better after a
many months test.

Thanks for your comments.

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