Hello Options Traders
I am new to this area and I would like to give you some advise about selling out of the money options and covering them. The term is a "condor" because if you draw the profit/loss diagram it looks like a bird with a large wing spam (or so I'm told). I started this in 1994 with around 7,000 and at the end of the year I had over 22,000. That's right. I thought I found the goose with the golden egg. However, as long as the market remains neutral, you're o.k. As you know, 1995 was a different matter, and employing a market neutral stategy in a surging bull market did in fact "kill me" I proceeded to lose almost all of the gain from the prior year, so with paying taxes on a 15,000 gain and only being able to right off 3,000 in losses, I was a net loser. Besides, it gets mighty hard to sleep at night (I'm not kidding, either).
I guess the bottom line is there is no way to beat the market. If it were so easy, everybody would be doing it, the premiums on out of the money options would decline, then the risk wouldn't be worth the reward.
If you want some more info about the strategy, let me know. Good luck. |
