Trader - made $41 million profit in 3 years option trading - YouTube
Anyone have any thoughts on this woman? I smell a rat....
Anyone have any thoughts on this woman? I smell a rat....
Trader333
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Difficult to know, she claims to be working on price and volume with Bollinger bands and theta on indices using options. It maybe that the strategy is working in the market conditions that have been prevalent since 2008. It also sounds like she is using a specific modeling technique which few traders use.
Thanks dude. Interesting things to note having traded single stock options and futures for a bank in the past.
1. She claims to never write options with more than 40-50 day exp max. So she's trading the front end of the term structure.
2. She claims she only ever sells 5% options (so way out the money calls or puts) generally call spreads or put spreads.
3. claims se does this on NSX, SPX and DAX i think...basically major indices
Now given implied volatility rates over the last couple of years selling the wings like this near term....i just can get how on earth she get's any significant premium. Unless she is trading in MASSIVE size. But to do this desks would know about it. I mean there's bugger all premium to be taken in by doing that....you don't get paid for taking 5% risk. So the concept of her making 1000s of percent to convert 100k into 41million i find absolutely hard to figure out?
Re her modelling technique....i think that's not so important....her options valuation is not going to account for that. And anyway - she's not doing any price mean reversion etc or LTCM stuff so quality of model is irrelevant....she's simply taking in theta (writing options)....it doesn't add up.
1. She claims to never write options with more than 40-50 day exp max. So she's trading the front end of the term structure.
2. She claims she only ever sells 5% options (so way out the money calls or puts) generally call spreads or put spreads.
3. claims se does this on NSX, SPX and DAX i think...basically major indices
Now given implied volatility rates over the last couple of years selling the wings like this near term....i just can get how on earth she get's any significant premium. Unless she is trading in MASSIVE size. But to do this desks would know about it. I mean there's bugger all premium to be taken in by doing that....you don't get paid for taking 5% risk. So the concept of her making 1000s of percent to convert 100k into 41million i find absolutely hard to figure out?
Re her modelling technique....i think that's not so important....her options valuation is not going to account for that. And anyway - she's not doing any price mean reversion etc or LTCM stuff so quality of model is irrelevant....she's simply taking in theta (writing options)....it doesn't add up.
Trader333
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Yes good points and the impression I got is that she was not using massive size and that only once in the last year was there any drawdown. The modeling I was referring to was the "drawdown" one where the model exactly matched projected drawdown and if true this would be a hugely useful tool for anyone.
I agree though that it doesn't seem to make sense and even more so as she says her approach is getting ever more simple.
I agree though that it doesn't seem to make sense and even more so as she says her approach is getting ever more simple.
BeginnerJoe
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She said 0 to 1 draw downs a year. Maybe she wrote covered options.
Agreed. Also interesting to see the classic signs of: No performance published, No chart, no further local press write up....etc etc...
Because i guess if the guy next door made 41million USD doing that in three years then went to the national press then nobody locally would be interested etc etc....nobody would have written much about it. She also makes some mistakes and then corrects herself in her video....she doesn't see sure of her strat and speak very opaquely. I guess we'll see if anybody else chimes in...
She will be running seminars in the Travel Inn in Staines soon. All the secrets for just £3999.
NVP
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hey all
options or no options .....
i'm just using the US equities as an example here .......trading above below the 2 most famous SMA's and very high leveraging the big moves and being smart/nimble around those chop spots is surely gonna generate a lot of profits 2008-2011 ?
N
options or no options .....
i'm just using the US equities as an example here .......trading above below the 2 most famous SMA's and very high leveraging the big moves and being smart/nimble around those chop spots is surely gonna generate a lot of profits 2008-2011 ?
N
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NVP
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ironcondorz
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I believe her story is legit but the explanation of her P&L is awkwardly done. I watched the Oct 2012 video a cpl of months ago just out of happenstance and was floored because her evolution of trading options mirrors mine in almost every detail (I started the same time, made exactly the same mistakes, reached the same conclusions, trade only low delta index options selling credit spreads with what seems to be very similar mkt indicators, etc.). I am making ~ 2%/month on invested capital and on average am about 60-70% invested, so I know what returns are achievable.
Based on my understanding of having now watched both videos twice, she did not make $40 mil in profits on $100k. She started trading with $100k then took in partners she met from Investools seminars to get to $700k, then took in outside money. She may have made $40 mil in total profits over several yrs as her AUM rose from $100k to $100mil (which is what they seem to be now). So my guess is she has taken in $60 mil in outside capital and made $40 mil on that which, based on her/my trading, does align.
Based on my understanding of having now watched both videos twice, she did not make $40 mil in profits on $100k. She started trading with $100k then took in partners she met from Investools seminars to get to $700k, then took in outside money. She may have made $40 mil in total profits over several yrs as her AUM rose from $100k to $100mil (which is what they seem to be now). So my guess is she has taken in $60 mil in outside capital and made $40 mil on that which, based on her/my trading, does align.
I'm also generally skeptical of the story, but if she was taking on enormous risk (I translated this as leverage), as the moderator hinted, I could see her doing it with the amount of capital that was hinted at (around 800K from friends), particularly selling naked index options. Almost anything is possible if you're never wrong.
My experience also re the +2% monthly. I have always been enamored of selling time and volatility (aka short). No reliance on directional at all as after 30+yrs of trying every tech indicator and then some. Seems to work for John Carter, just not me. Why else would deltas at the money be 50%? If there was real ability to forecast direction the deltas would differ substantially IMHO. YMMV...
Works for me tho...
Cheers,
Jerry
DionysusToast
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I don't see why it wouldn't be true.
At the end of the day, pure chance will create success stories like that.
Some people like this will inevitably exist through pure chance and of course some will exist through skill and a large set of spheres.
If you want to follow somebody like this, you need to figure out how much of their success was down to pure chance. Not very easy that. Based on the evidence, I'm totally neutral on it.
At the end of the day, pure chance will create success stories like that.
Some people like this will inevitably exist through pure chance and of course some will exist through skill and a large set of spheres.
If you want to follow somebody like this, you need to figure out how much of their success was down to pure chance. Not very easy that. Based on the evidence, I'm totally neutral on it.
She doesn't "bill" herself as supertrader, Tastytrade did.
L
Liquid validity
Could be true, could also be another OPM fund ponzi.
If true, bull run fueled greenback printing press, game over when it stops.
If it is true, probably by taking excessive risk (LTCM, Niederhoffer - i.e degenerate gambling...)
Personally, I reckon its an LTCM / Madoff waiting to happen.
Other than mild curiosity, who cares, not my money, risk or profit.
If true, bull run fueled greenback printing press, game over when it stops.
If it is true, probably by taking excessive risk (LTCM, Niederhoffer - i.e degenerate gambling...)
Personally, I reckon its an LTCM / Madoff waiting to happen.
Other than mild curiosity, who cares, not my money, risk or profit.
neil
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What DT states above is probably a good example of the "Black Swan" effect old Tarbes writes about
Very good point Toast. People seem to forget that there are always people at both ends of the bell curve.
There is a lot of publicity associated with her past success but is she still trading? If she can maintain that level of performance or thereabouts then it is not luck but skill.
Has anyone seen her yearly tax returns?
Has anyone seen her personal balance sheet, ie assets AND liabilities.
I doubt it, therefore it pays to believe nothing in this game until you see cold hard facts. And this is especially the case when the person in question is going to teach you how to trade.
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