Topic List

tom

tom

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This is the list of topics I came up for discussions in trading group 1.

I'm thinking that we discuss most or all of each meeting to each topic. We can always change plans, but it's good to have something to deviate from.

Here's the list in no particular order:
  • Current market (suitable for periods when markets are challenging traders)
  • Hedging (teenies, volatility, diversifying portfolio etc)
  • Butterflies - Road Trip, Rhino, Weirdors, M3, etcöOther non-directional trades (Parking trade, verticals, condors, diagonals etc)
  • Investor suitable (equities, collars, married puts, covered calls, investor RTT etc)
  • Adjustments and layering (when to enter/exit, different types, considerations etc)
  • Greeks ( interpretation, synthetics
  • Directional trading (futures, directional option trades)
  • Futures options trades ( ES, 6E, CL, GC, etc.. )
  • Grab bag (could be anything from software, hardware, security, productivity, brokers etc)

Please reply with your thoughts of what you'd like the group to discuss in the next few meetings.
 
Does anyone have any requests of what topics they would like to cover?
 
I would like to see more simple trades like
Parking trade, verticals, condors
Something that does not require a lot of adjustments

and
Adjustments and layering (when to enter/exit, different types, considerations etc)
In case there is a need to adjust the above trades
 
Thanks for the feedback! Today my topic is 1-2-3 patterns, the Ross Hook and the Trader's Trick Entry from Joe Ross.
 
Tom, Dan:

At some point down the road, I'd like to hear your comments/experience on Rho. My impression, Rho has been outcast since we cleared the stagflation in the mid 80's. This topic is not a priority and more an academic interest to complete my understanding of all the Greeks. Perhaps someone in the group could help us younger fellows understand if/how/when Rho re-enters the calculus of successful options trading.

I have a number of thoughts that are likely NOT of interest to the broader group. That said, in the spirit of sharing and the remote possibility one of these might trigger a topic of interest ...
  • Dan's Expectancy Principle. As I improve my trade log, I need to quantify and document the expectancy of each specific trade as part of the design in order to determine if I was lucky vs. good at the conclusion of the trade. The Aeromir Equity Growth Chart and metrics are very comprehensive. This may be as simple as creating my own Equity Growth Chart with these parameters for my trade performance.

    Also, if others did something similar - I could see the mix of results across the group serving to be an unending source of differences to discuss.

  • How do I scale trade strategies? Are there additional risk metrics to consider when doing larger lot sizes? Are there successful methods when increasing the RTT lot size? Are there important watch-outs and lessons learned? It is logistically easy to increase (2x, 3x, ...) lot size of the class solution, it can be problematic when one tries a fraction (e.g., 1/2 class solution lot size), especially when adjustment time comes - e.g., what are all the synthetic techniques of adding a PDS when 1 lot SPX PDS spread is too large?

    Perhaps staying with the class solution lot size is best and one should interleave additional RTT's between the 2x / month class portfolio (kind of the tastytrade mantra: trade small/trade often)

  • Trying to remember Real Option Theory from years ago ... Is there value to construct standard scenarios and associated probabilities for a generic RTT? An option tree where common adjustments are represented for known/expected scenarios (expected trading ranges of volatility, SPX, days in trade, ...) with probabilities and expected final P/L prediction.

    This group has an incredible level of knowledge embedded in their muscle memory or in other words unconscious competence - given the many years of trading and RTT strategy design. You know, "feel the force" type of thing as the Master Jedi inherently avoids bad adjustment decisions.

    The learning atmosphere of the group is excellent and clearly requires each individual to sort out their own plans and decision points. This Padawon is working to close the gaps.

    I also don't understand how, or even if, all these risk metrics can be used for one's aggregate RTT portfolio.

    I wonder if there is a mix of trade strategies that provide more of a natural portfolio hedge or elevates the aggregate risk profile. Watching Tim P with his calendar insertion VEGA analysis, Dan overlaying condors, ... tells me there's value here yet to be exploited.
 
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Would like to see someone (Amy?) do an overview of Option Net Explorer.
Maybe have Gary go over his report and explain what each of the items reported represent.
Have Dan explain how a baby butter raises premium when it's normally a debit trade
 
Dan, You mentioned in TG1 today that you found an e-book by Scott Ruble on the back ratio spread. I have been searching the web but came up with only one out of print book by J L Lord. Can you tell me where you found the e-book?
thanks, Tim
 
Hi Tim. The ebook I mentioned (Call Instead of Stock) and accompanying video can be purchased for $129 on his web site, Stratagemtrading.com. He uses a ratio spread as a hedge sometimes, but I don't know if he has a separate book.
 
Hi Tom and Dan,

I would like to hear your opinion about some kind of morning routine to access the markets before one starts a trading day. Capturing every day in Excel for example.
Is there anything that you already do or what are your recommendations about the parameters. I‘m pretty sure there might be a lot of stuff to access but let‘s put the RTT in context.
I have got in my mind VIX, contango, VXV, EMAs etc.

Thanks
Robert
 
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