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Walt:
Those indicators would be ...?
- Stuart :-)
>>> Walt Downs <knight@xxxxxxxxxxxx> 06/11 3:33 PM >>>
BrentinUtahsDixie wrote:
>
> RT's,
>
> A fellow Real Trader has told me that the strategy of trading Long
> Straddles is a loser 90% of the time. Can any of you refute/confirm that.
Brent,
I trade quite a few of these, especially in the grains. I use them
to capture volatility spikes when two conditions exist:
1. Very low volatility in the options to be spread.
2. A strong probability of an extreme vol spike as indicated by
several indicators that I use.
These positions are often not held for very long. if I get my spike
to the upside, I average about 450.00 in profit per spread. Less than
that to the short side, as there is always less interest in the puts,
and some gains are lost due to lognormal skewing.
Trading this strategy, these spreads can be highly effective.
Granted, the markets and options must be liquid as possible. Most of
my trading is in Wheat, Soybeans, Corn, Crude Oil, T Bonds, J Yen
S Franc, D Mark and SP 500. Sometimes Sugar.
Regards,
Walt Downs
CIS Trading
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