Thursday, May 20, 2010

Re: [TheOptionClub.com] GS TRADE [was:How do you manage your Vega?]

 

On Wed, 19 May 2010 22:46:27 -0500, "mcatolico"
<mcatolico@mindspring.com> wrote:

>Thanks james. You said it much better than i.
>
>-----Original Message-----
>From: JP
><...>
>I think you may be looking too hard to find the secret sauce [or algorithm]
>and it may be easier to try and develop a simple framwork to understand this
>type of trading.
>
Simple framework for your kind of trading? Pleeeaze. Just knowing
the bare essentials is not enough. I am curious why I have never read
about the method. Do you know many people who operate in a similiar
way? If I were to try it myself, certainly paper money for the first
few months, I would sell a small amount of ATM premium every day using
the same play each time, perhaps a single IC or IB and do the
necessary flattening and buying the now OTM shorts during expiration
week. Have you tried or considered such a semi-mechanical approach?
The one criticism of the trying to center the entire trade around the
current ATM, that occurs to me, is why bother so hard with these
volatile stocks since you know, very well that the chances of it
staying put are very low?.

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