Naked Options Selling!

Are you really going to buy a debit disperse that is put? Which month? How far out do you usually buy?


Frank

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With so much talk of a transport trade reversal, this would be a good time to buy a set time spread on your favorite transport pair. Watch this space! More about that later!

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With discussion of a transport trade change, this would be a fantastic time to purchase a set time spread on your preferred transport pair. Watch this space! More on this later!

UPDATE: Friday, June 22nd: Silent markets together with the insatiable thirst for interest sends GBP/JPY into 247.8. That's 500 pips above the strike. At those levels, at put time spread appears much more attractive. More details on this later.

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Thanks!!! This egy'll be attempting .


Frank

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Sounds good! Allow me to know how it works out. Maintain the position size small. It's tempting to take on a massive position and collect a ton of premium (that, together with the absence of a hedge is that which caused a 25-30% drawdown for me personally when I first started analyzing)... so do not do it.


UPDATE: Thursday, June 21st: The BoE meeting minutes were somewhat more hawkish than expected (vote was 5-4 for steady vs. increased rates, 7-2 expected) contributing GBP/JPY to top the 246.5 level.

Thank You!!! I'll be attempting this egy .


Frank

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Absolutely. After some of those drawdowns occurred (in the very beginning), they were extreme (~30%), but that was my fault (i.e. not hedging the option, or allowing the spot order to reverse with no stop). I set as restricted drawdowns stand that I managed to recover into a high water mark within a rather short quantity of time.

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Can you say that you've been overall profitable with this egy for the previous 10 months?


Thank you,

Frank

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Absolutely. When some of those drawdowns happened (in the very beginning), they had been intense (~30%), but was my fault (i.e. not hedging the option, or permitting the spot order to undo with no stop). I put since they now stand drawdowns that were limited to the stage that I managed to recover into a high water mark within a short quantity of time.

Would you say that you have been complete rewarding with this plan for the last ten weeks?


Thanks,

Frank

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Originally Posted by ;

,

Thanks for sharing your trades and how things are moving. I am considering to give a go to this. But, I am curious if things go against you personally how you're hedging this. As it means your strike cost, can you just purchase the?

Or do you pay it with a FOTM all - vertical credit spread?

Or do you just market, and hope/monitor closely?



Thanks,

Frank

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If things go against me, as they did AUD/JPY last week, I pay the entire option position with a place position. If performed order becomes active at the same time to prevent infinite losses on 19, A set. I typically place the S/L far enough away that the odds of a whipsaw (ie. Moving back towards strike) taking you out is very low. When it did whipsaw (and hit the stop), I'd repeat the very same steps. As an alternative, I might purchase an OTM put/call (less costly, but then you can not collect swap depending on the set).

I must've been residing in a time warp or something! I had said that I have demoed to going. According to my saved e-mails in Yahoo, I have been demo trading this egy because Aug 2006 (around the same moment I opened the MB Trading accounts). So experience is all about 10 months! Time flies.

Additionally, with the hedge orders set up, I still hope/monitor closely! LOL

Ragingbull94mtx,

Thank you for sharing your trades and how things are moving. I am considering to provide this a try. However, I am curious when things go against you how you are hedging this. As it approaches your strike cost, can you purchase the underlying?

Or do you cover it with a FOTM all - vertical credit spread?

Or do you simply sell, and hope/monitor closely?



Thanks,

Frank