Indeed, if there is a simpler way to avoid the black swans (instead of "adjustments") , even at lower profitability, it should be a worthwhile exploration.. Something like a rule based system..
Indeed, if there is a simpler way to avoid the black swans (instead of "adjustments") , even at lower profitability, it should be a worthwhile exploration.. Something like a rule-based system..
Rules cannot avoid Black Swans. The best way to avoid black swans is to not trade at all. Trader should have rules as to how to tackle a Black Swan event.
First of selling option requires good capital. Not every trade requires adjustments. Black swan is not a daily occurrence. Yes adjustments are required either to limit the loss or to come out with marginal profits. which other instrument has the opportunity of limiting the loss AFTER a blackswan event has occurred,
1. The simpler way is to always have a hedged position.
2. Even then something will go wrong then have reserve firepower to limit the loss.
Was teaching my my elder daughter about options and then when I mentioned that 70-80% options expire worthless. Then she told why dont we sell the entire option chain. I said ok "may be not the entire option chain as I am not ambani .But we will sell the bulk of it in the middle and since it is your Idea and on 10th being the weekly expiry and 19th Birthday. I will give all the profits of this trade to you. Here is the result when I sold the options in Friday. Though this method may not be efficient use of capital. But 5% of return on Capital in 5 days is not bad.
Was teaching my my elder daughter about options and then when I mentioned that 70-80% options expire worthless. Then she told why dont we sell the entire option chain. I said ok "may be not the entire option chain as I am not ambani .But we will sell the bulk of it in the middle and since it is your Idea and on 10th being the weekly expiry and 19th Birthday. I will give all the profits of this trade to you. Here is the result when I sold the options in Friday. Though this method may not be efficient use of capital. But 5% of return on Capital in 5 days is not bad.
Was teaching my my elder daughter about options and then when I mentioned that 70-80% options expire worthless. Then she told why dont we sell the entire option chain. I said ok "may be not the entire option chain as I am not ambani .But we will sell the bulk of it in the middle and since it is your Idea and on 10th being the weekly expiry and 19th Birthday. I will give all the profits of this trade to you. Here is the result when I sold the options in Friday. Though this method may not be efficient use of capital. But 5% of return on Capital in 5 days is not bad.
Congratulations Sanju Bro & your daughter also for brilliant trade.
She must be happy.She has got a very good profit as a Gift on her Birthday! May God bless her always & May she get a very happy & very successful life.
Keep Profiting
no parts . entry exit all at once. so that i dont have to watch the charts the whole day. Well that's the point of getting into trading business is it not.
no parts . entry exit all at once. so that i dont have to watch the charts the whole day. Well that's the point of getting into trading business is it not. View attachment 44248
for some butterfly and calendar spreads, i'm timing the quick moves. Small drops in NS are quick, so enter the short legs and 20-50pts later the buy legs.
the trade becomes slightly profitable for all spot prices and then if expiry is within the range u get the max out of it.
Doesnt happen all the time but on a large number of trades it worked better.