I am starting this thread in response to the suggestion made on this
thread. It appears there is a need.
I was a professional
Vanilla Options trader for a number of years. I worked with both Nomura and MS as an FX Options trader. I have done incredibly well from it and for the past 2 years since leaving banking I have been trading Vanilla Options retail, it was very difficult to find in retail understandably most brokers can only handle binary Options as it is a scam. So long and short I eventually found the only broker in the UK with this and 2 years on I pretty happy, a little bit more expensive than interbank Options but the gains show make up for it and it is natural with the risk on Options that the dealer gets compensated fairly.
Anyway, retail brokers have had open season on poor clients who have stops hunted within some 100 pips these days, the average volatility on assets has been cranked up. Most professionals don't trade spot, they trade derivatives, this is a crucial part of trading that leads to guys make lots of money. It is nearly impossible to make money in spot markets, most people are just lying and brokers are doing a fine job of circulating fake statistics. It's all "Fugazi". Real money is made everyday in the futures and Options markets by professionals, they don't want you to know because that will put many brokers out of business as most can't even afford a seat on a real exchange and refuse to offer OTC products that mean that they won't make as much money. Notice TBond futures are rarely available as CFD's. That's because TBond futures are easy to call and a really directional. I am an Options trader, one of my good friends was a Barclays Bond trader and he was making $1,000 a day with roughly $250-$300 risk, he is has made millions on T bond futures.
I can only tell you about Vanilla Options
An Option is a derivative most traders will trade the Option and create a delta hedge in the cash market as necessary. Hence the NY cut is more and more talked about.
Options don't need stop losses as your risk is the premium, that puts an end to be stop hunted. Volatility is your friend, the more volatile the market, the better for you.
Options expire, so you can long date them for time value or short date and look for intrinsic value.
It can also act as insurance and limit losses in the cash market but with various strategies in the Options market like Straddles and Strangles, there is not much point.
Options have there cost built in so naturally the spread is wider, that said once the premium is paid the spread is one off cost, so the broker cannot spread widen something that is the norm in the spot market, imagine no slippage.
These are few reasons why professionals including your broker is active in the Options market making money off you. Time to spark a real debate here. Open your eyes to this. It may be your only saviour.
comments welcome from FX Options traders. The above link takes you as well to this
Options school for free, so you can gain some background, it is one of the best sources I found in one place.
I hoping to generate some healthy debate and share experience on this thread on how everyone can start reaping the rewards of trading. No more dreams...
