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After trying several options software packages, IMHO they're all generic in
terms of strategies, but (attempt to) differentiate in terms of how they
display the results, and in some cases offer position management, which they
euphemistically call portfolio management. Using their built-in strategies
is somewhat analogous to everyone trading the same strategies, and of course
everyone losing. My answer to the bland offerings has been to use home-grown
Excel spreadsheets, but I'd very much like to find a better approach. Hence
the search for options software.
I've read McMillan (a few times over), but not Natenburg, and Fontenals
doesn't seem credible to me, and I haven't given him any benefit of my
doubt. My options appreciation and practice is simplified to accounting
principles: if it's a net debit strategy, I'm anticipating a spread(s) to
widen, and it it's a net credit strategy(s), the opposite. Endeavoring to
scalp over or under pricing using the "Greeks" to measure value and its
change, IMHO is barely doable off the trading floor. The data that's
available is just too stale, and frequently incorrect. It was expensive for
me to learn this.
Generally, I've found options (and other derivatives) when combined with
their underlying(s) chosen by more of a fundamental paradigm and less of as
a technical study to offer well above average opportunity. That is, the
"proper" use of derivatives rather than speculating in them has proven far
more fruitful, for me at least.
Hope that helps!
Colin West
read your email on options and have a few questions...have you ever looked
at telescan option module....or optionetics software....that's george
Fontenals dot com site.....how about reading natenburg or Macmillan....in
Larry Mac's second book he goes into delta/gamma /vega neutral
strategies..have you ever tried those....thanks...even if there all no's...
At 12:51 PM 4/7/01 -0600, you wrote:
>Fred,
>
>It's always good to hear about a pending rise in the liquidity of options.
>Of course I wish you well. I too have been evaluating option software and
>have passed on the packages you've chosen as the final contenders. Here're
>my comments, since you asked so nicely.
>
>There isn't one application that addresses all needs, unless you're
prepared
>to spend at least $6,000 a year. The upper end seems to be around $25,000
>for a single user. If you intend to speculate with just a handful of
>positions at a time, as distinct from hedging through options, the best
user
>interface and a program from which you can learn a lot, particularly with
>good documentation, is AIQ's Option Expert. It wins hands down.
>
>However AIQ didn't work for me as I'm in the latter camp; i.e., hedging
>portfolios with a variety of derivatives. The limitations of AIQ in my case
>were the maximum number of legs per strategy being limited to five, I
>couldn't consolidate several strategies or positions, there wasn't anyway
to
>interface it to AIQ's new portfolio manager, and last but not least, when I
>created a strategy without using Option Experts trade finder, the math was
>off too much for my tolerance. AIQ readily recognized the latter problem
and
>will soon release a service pack. The initial support person you reach is
>shallow, but when it's a real problem you soon get to a knowledgeable
>person. Overall it's a great program for small position traders.
>
>OptionVue is another story. I found its interface very clunky. It seemed
>like you're always fishing for "something" to do a small job. The eventual
>reason I turned away from OptionVue was its obvious errors and the support
>person's comments that "perhaps it's not for me if I'm so particular."
>OptionVue offers a lot of features, but most of them are really poor in
>terms of over priced, unintuitive and ill-connected to the job of options
>trading. I think there should be much better value than OptionVue from
which
>to select.
>
>I also tried MicroHedge. The license is $300 a month, and they claim it's
>used by the majority of the "upstairs people" in Chicago. It's very
>extensive, but a programmer with an academic background will immediately
>notice that it's design is at odds with convention. The use of control keys
>to do "things" quickly is good, but you have to get used to the shortcuts
>doing other functions in most other software. But you can arrange several
>matrices just about any way you can image and very quickly jump from one to
>the other. But mainframe like risk graphics, yuk. It reminded me of a S/36
I
>had to support a hundred years ago let alone the "beauty" of an AS/400.
>MicroHedge could have worked for my application, but the graphics were just
>unacceptable. The program is more suitable to market-makers I believe who
>walk around with print-outs waiting to scalp off-floor day-traders.
>
>Some time ago I looked Option Pro from Essex Trading. They have a new
>version, which I installed on Friday. I'm having multi-screen issues with
>the software, so I'll install it on another PC next week. I'm hooking it up
>to eSignal rt. Reading the documentation of the latest version and
recalling
>my previous experience, I suspect Option Pro will functionally be very
>capable, particularly with all the weird strikes that have developed over
>recent years as result of splits, increased volatility, and so on. The
>documentation says the program offers a way to consolidate several
positions
>and strategies. This might be the one for me. I'll let you in a week if
>you're still looking for software.
>
>I tried OptionStation 2000i when it first came out. As I recall it seemed
>like yet another career to keep it running, and not much time left for
>trading. Someone on the list mentioned a month or so ago that all the bugs
>seemed to have been resolved, which immediately caused me to wonder if
there
>hadn't been some divine intervention in the Miami area. OptionStation Pro,
>along the lines of TradeStation Pro, may turn out to dominate in terms of
>the best bang for the buck and offering the most flexibility. I conferred
>with a person at Omega, oops, Tradestation Technologies, who shall remain
>anonymous, but I'm of the opinion that his opinion is strategically very
>important inside the camp. After a few long conversations, if the
>Tradestation Group can surmount the current challenges, when it's all said
>and done, they'll have about the best offerings. But I'll wait and see
>before getting into OptionStation, although I suspect that's where I'll end
>up.
>
>There is one other options package I've yet to evaluate. It's from
>Optionnomics. Developed by a guy with many years of arb experience, but a
>single-user license is around $12,000. More later if anyone is interested.
>
>Hope this helps.
>
>
>
>
>
> -----Original Message-----
>From: Fred Finch [mailto:ffinch@xxxxxxxxxx]
>Sent: Friday, April 06, 2001 5:32 PM
>To: Omega List
>Subject: Option Software
>
>Hello List,
>
>I have decided to add option trading to my many and varied ways of losing
>money. No, just kidding ;o). I do have a serious question though. I am
>looking at several different software packages to manage and trade options.
>I have currently narrowed it down to OptionVue 5 and TS OptionStation. I am
>aware of the cost difference and the additional capability as far as system
>writing and the such goes of OptionStation. So those differences have been
>discounted.
>
>I would like to get a real world view of each package and how it and the
>company's support and knowledge compare. I am a long time user of TS and on
>and off lurker of this list so I am aware of the current state of Omega. I
>guess that's why I'm even looking at other packages.
>
>Any and all comments, advise, and other software suggestions would be
>greatly appreciated.
>
>Fred
Opinions and Feedback Appreciated....
Jim
Atlanta, GA
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