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Walter
We've never traded anything but futures. I've tried options a couple of
times and lost money each time, and I'm not fond of losing money. <G>
We used to do some spreads many years ago in the grains and back when it was
legal, in Silver to move profits from one year to the next, but never
actually evaluated it in terms of tying it to our normal trading system,
where we trade completely uncovered. Our philosophy has always been to
commit to a position, one way or the other and not hedge anything.
Most of the spreads we've done have been like wheat/corn or beans/oil or
meal. That sort of thing, but that was probably 40 years ago. We prefer to
take uncovered positions since if you're right, you will be able to maximize
your returns. It wasn't until I happened to look at the margin sheet that I
noticed the big discrepancy in margin requirements between our regular
trading and a bull or bear spread. Since we don't normally hedge our
trades, my thought was to find out if this made any sense as compared with
our normal trading system. Using the much smaller margin requirements, you
wouldn't need too much in the way of the price difference to make a buck. I
was looking at this to expand our trading possibilities using the same
system.
Since I don't have the data (I need the 1998 S&P futures data) I thought I'd
throw it out on the list to see if anyone was using this technique, with or
without success.
Spreading to me is like copping your bet. By that I mean, you're really not
too sure about your trade and want to cover your behind in case you're
wrong. Years ago I learned from the old man that if I take a position and
it goes against me, take the loss... Never, ever trade a spread since the
only thing you've managed to do is to lock in the loss.
Regards
Guy
-----Original Message-----
From: owner-metastock@xxxxxxxxxxxxx
[mailto:owner-metastock@xxxxxxxxxxxxx]On Behalf Of Walter Lake
Sent: Tuesday, June 08, 1999 3:59 PM
To: metastock@xxxxxxxxxxxxx
Subject: Re: Bull/Bear Spreads?
Hi Guy
You're kidding me right? ... All these years you and your family have been
trading the S&P etc.
Best regards
Walter
----- Original Message -----
From: Guy Tann <grt@xxxxxxxxxxxx>
To: Metastock <metastock@xxxxxxxxxxxxx>
Sent: Tuesday, June 08, 1999 11:41 AM
Subject: Bull/Bear Spreads?
> All
>
> Is anyone using bull/bear spreads in trading futures? Just looking at the
> spread margins, you might be able to gain significantly more leverage than
> with pure futures trading.
>
> As an aside, does anyone know where I can pick up 1998 S&P history. Found
a
> historical site but their data ends with 1997. Too bad, as it looked
pretty
> good and the price was right.
>
> Thanks
>
> Guy
>
>
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