Trading for Living -- Successfully Completed one year as Full Time Trader

[SarangSood]

Yes. Been trading since 2005 and my father 1991. Am specifically an option writer from last 9 years.

Wow ...great...hope we are get good lessons from you too like amrutham...As we are in blind when come option writing....Please share your thoughts whenever time permits you....Thanks

Option writing is also very diverse in itself. Some people short strangles, some use other strategies like butterfly, condor etc. Only thing that remains constant in which everyone is affected is rise or fall of volatility.

A naked strangle can give maximum profit if sold in a Vega conducive market where options erode with every movement. But with handling a strangle comes the job of neutraling the delta which can be tedious. There have been days in which BNF moves 400 points and my short strangle is in profit just because of the swiftness in which i shift my position without giving it a second thought.

So it's really upto you how you want to trade but one thing remains is in understanding Volatility not the bearish or bullish moves to write.

 

[SarangSood]

Yes. Been trading since 2005 and my father 1991. Am specifically an option writer from last 9 years.

Wow. Options writing for 9 years. You might have seen many highs and lows. Please share your experiences.

What strategies do you use? Is it same strategies or you changed strategies with time?

It use to be easy back in 2009. But the volatility became more and more complicated as everyone started doing it. I know people without any market knowledge making money just to bust their account in few months. I also lost my previous 4 month earnings in Aug'15 crash.

I have tried every kind of strategy in these past years (credit spreads, ratios, butterfly, calendar spreads,iron condor etc). I soon realized that there is no magic strategy that can give consistent results but the knowledge of the market volatility itself. If there is volatility bound to come no strategy where you receive credit can save you (except for if your playing direction and you get it right).

Now how to read volatility? I will give you a classical example of Sep'16 (surgical strike). The whole month the delta neutral strangle wasn't giving any profits. With every adjustment i was losing my credit as well as gains. Mind you this is not reflected in VIX. But there was clearly something fishy. I didn't make money that month but didn't gave any as well which is very important to survive because majority of months will give good returns. So we need to understand how volatility rises and is eventually sold off.

Since last one year i have shifted to BNF which has suited my style of shorting strangle very well. The principles remain the same. I increase my position in profits while shifting and cut the loss as it happens. Over past year i have started converting my strangle into condor (where my OTM remains short but i buy ATM against it) which gives decent profit in weeks like these.

 

[nikhil_chinapa2]

Mai rooun ya hassun ....mere ko samajh nahi aaraha !

People with prior experience , Amrutham and Sarang .... to me it looks all good and in control. How do you see my positions ?

actually its just first time writing options and trying strangles , do advice.

 

[mycall]

It use to be easy back in 2009. But the volatility became more and more complicated as everyone started doing it. I know people without any market knowledge making money just to bust their account in few months. I also lost my previous 4 month earnings in Aug'15 crash.

I have tried every kind of strategy in these past years (credit spreads, ratios, butterfly, calendar spreads,iron condor etc). I soon realized that there is no magic strategy that can give consistent results but the knowledge of the market volatility itself. If there is volatility bound to come no strategy where you receive credit can save you (except for if your playing direction and you get it right).

Now how to read volatility? I will give you a classical example of Sep'16 (surgical strike). The whole month the delta neutral strangle wasn't giving any profits. With every adjustment i was losing my credit as well as gains. Mind you this is not reflected in VIX. But there was clearly something fishy. I didn't make money that month but didn't gave any as well which is very important to survive because majority of months will give good returns. So we need to understand how volatility rises and is eventually sold off.

Since last one year i have shifted to BNF which has suited my style of shorting strangle very well. The principles remain the same. I increase my position in profits while shifting and cut the loss as it happens. Over past year i have started converting my strangle into condor (where my OTM remains short but i buy ATM against it) which gives decent profit in weeks like these.

Very very useful insight... this is nearly something we are currently researching on... your post just gave me a hard boost..

My main series short strangle management system is going this direction only... Thank you...

 

[VJAY]

It use to be easy back in 2009. But the volatility became more and more complicated as everyone started doing it. I know people without any market knowledge making money just to bust their account in few months. I also lost my previous 4 month earnings in Aug'15 crash.

I have tried every kind of strategy in these past years (credit spreads, ratios, butterfly, calendar spreads,iron condor etc). I soon realized that there is no magic strategy that can give consistent results but the knowledge of the market volatility itself. If there is volatility bound to come no strategy where you receive credit can save you (except for if your playing direction and you get it right).

Now how to read volatility? I will give you a classical example of Sep'16 (surgical strike). The whole month the delta neutral strangle wasn't giving any profits. With every adjustment i was losing my credit as well as gains. Mind you this is not reflected in VIX. But there was clearly something fishy. I didn't make money that month but didn't gave any as well which is very important to survive because majority of months will give good returns. So we need to understand how volatility rises and is eventually sold off.

Since last one year i have shifted to BNF which has suited my style of shorting strangle very well. The principles remain the same. I increase my position in profits while shifting and cut the loss as it happens. Over past year i have started converting my strangle into condor (where my OTM remains short but i buy ATM against it) which gives decent profit in weeks like these.

Dear sarang bro,
Can you please explain a bit more about the bold part....it means you shift profit making side to new strike ?what about loss making side?

 

[sreperu]

It use to be easy back in 2009. But the volatility became more and more complicated as everyone started doing it. I know people without any market knowledge making money just to bust their account in few months. I also lost my previous 4 month earnings in Aug'15 crash.

I have tried every kind of strategy in these past years (credit spreads, ratios, butterfly, calendar spreads,iron condor etc). I soon realized that there is no magic strategy that can give consistent results but the knowledge of the market volatility itself. If there is volatility bound to come no strategy where you receive credit can save you (except for if your playing direction and you get it right).

Now how to read volatility? I will give you a classical example of Sep'16 (surgical strike). The whole month the delta neutral strangle wasn't giving any profits. With every adjustment i was losing my credit as well as gains. Mind you this is not reflected in VIX. But there was clearly something fishy. I didn't make money that month but didn't gave any as well which is very important to survive because majority of months will give good returns. So we need to understand how volatility rises and is eventually sold off.

Since last one year i have shifted to BNF which has suited my style of shorting strangle very well. The principles remain the same. I increase my position in profits while shifting and cut the loss as it happens. Over past year i have started converting my strangle into condor (where my OTM remains short but i buy ATM against it) which gives decent profit in weeks like these.

Thanks a lot, nice info Sarang. Please explain with some example traded previously. It will clear lot of doubts.

 

[mycall]

View attachment 26704

Mai rooun ya hassun ....mere ko samajh nahi aaraha !

People with prior experience , Amrutham and Sarang .... to me it looks all good and in control. How do you see my positions ?

actually its just first time writing options and trying strangles , do advice.

Please learn brother... do some paper trading... spend time with your excel sheet which will help you observe different situations... if you can't be away from market please start with spreads...

Please follow Amrutham's posts... when he posts the trades... put those in excel and observe how options reacts to different situations... develop a relationship with the options... you will start to know them better

These are my own views... hope this helps

 

[MaxX]

It use to be easy back in 2009. But the volatility became more and more complicated as everyone started doing it. I know people without any market knowledge making money just to bust their account in few months. I also lost my previous 4 month earnings in Aug'15 crash.

I have tried every kind of strategy in these past years (credit spreads, ratios, butterfly, calendar spreads,iron condor etc). I soon realized that there is no magic strategy that can give consistent results but the knowledge of the market volatility itself. If there is volatility bound to come no strategy where you receive credit can save you (except for if your playing direction and you get it right).

Now how to read volatility? I will give you a classical example of Sep'16 (surgical strike). The whole month the delta neutral strangle wasn't giving any profits. With every adjustment i was losing my credit as well as gains. Mind you this is not reflected in VIX. But there was clearly something fishy. I didn't make money that month but didn't gave any as well which is very important to survive because majority of months will give good returns. So we need to understand how volatility rises and is eventually sold off.

Since last one year i have shifted to BNF which has suited my style of shorting strangle very well. The principles remain the same. I increase my position in profits while shifting and cut the loss as it happens. Over past year i have started converting my strangle into condor (where my OTM remains short but i buy ATM against it) which gives decent profit in weeks like these.

That's a good idea.. last few days are not going too good for me, even with getting the direction right (bullish delta short strangle) on the nifty !

Something sure is fishy..

 

[govindheg]

It use to be easy back in 2009. But the volatility became more and more complicated as everyone started doing it. I know people without any market knowledge making money just to bust their account in few months. I also lost my previous 4 month earnings in Aug'15 crash.

I have tried every kind of strategy in these past years (credit spreads, ratios, butterfly, calendar spreads,iron condor etc). I soon realized that there is no magic strategy that can give consistent results but the knowledge of the market volatility itself. If there is volatility bound to come no strategy where you receive credit can save you (except for if your playing direction and you get it right).

Now how to read volatility? I will give you a classical example of Sep'16 (surgical strike). The whole month the delta neutral strangle wasn't giving any profits. With every adjustment i was losing my credit as well as gains. Mind you this is not reflected in VIX. But there was clearly something fishy. I didn't make money that month but didn't gave any as well which is very important to survive because majority of months will give good returns. So we need to understand how volatility rises and is eventually sold off.

Since last one year i have shifted to BNF which has suited my style of shorting strangle very well. The principles remain the same. I increase my position in profits while shifting and cut the loss as it happens. Over past year i have started converting my strangle into condor (where my OTM remains short but i buy ATM against it) which gives decent profit in weeks like these.

Hi,
Nice to have you here. Thanks

 

[SarangSood]

View attachment 26704

Mai rooun ya hassun ....mere ko samajh nahi aaraha !

People with prior experience , Amrutham and Sarang .... to me it looks all good and in control. How do you see my positions ?

actually its just first time writing options and trying strangles , do advice.

You are expecting the market to go up. That is the only way you make money. I hope you have good reasons for that. Because you have sold monthly strangle it will not erode much tomorrow. This week has not been a good one to try and write options. You will have better and easy markets as well.