Optionetics Course - Is it good?

[long88]

All the imputs into Hoadley must be correct. I don't have Hoadley loaded up at present, but will let you know the imputs I use when I get time.

To get a match between market price and theo price in Hoadley, you must have the correct amount of volatility entered. (Hoadley can work out the IV for you based on the current market price - there are buttons for this purpose - they are positioned in the upper right hand on my Hoadley screen.) Dividends and xdiv dates must also be properly entered if they are applicable to the stock you are analysing.

Thx for that, it looks like it is worth purchasing now.

 

[sails]

Thx for that, it looks like it is worth purchasing now.

I don't subscribe every year as one gets 12 months of downloads and the software continues to work even after the subscription runs out. You just can't continue to download upgrades for free after 12 months.

I found Hoadley great for playing around with different strategy ideas before deciding to run live with them or not. Loved the comparison ability and the volatility analysis diagrams. There a a lot of very useful features - have a look at the demos on the Hoadley site for more info.

 

[long88]

I don't subscribe every year as one gets 12 months of downloads and the software continues to work even after the subscription runs out. You just can't continue to download upgrades for free after 12 months.

I found Hoadley great for playing around with different strategy ideas before deciding to run live with them or not. Loved the comparison ability and the volatility analysis diagrams. There a a lot of very useful features - have a look at the demos on the Hoadley site for more info.

i am already using it, just for the sake of payoff diagram (for aussie market).

although i can see how the volatility impact by playing on the numbers. but i never get the theoretical value to match trading value, moreover the market here is aus so wide in spread, always lose on buying and selling. god damm the market maker.

 

[sails]

i am already using it, just for the sake of payoff diagram (for aussie market).

although i can see how the volatility impact by playing on the numbers. but i never get the theoretical value to match trading value, moreover the market here is aus so wide in spread, always lose on buying and selling. god damm the market maker.

Yeah, that's one of the many downsides of the Aus market. I am finding limited opportunities with options here in Aus, however, trading at night is out of the question at the moment, so I'm stuck with the what we've got here.

Bid/ask spreads are wider than normal - certainly not helped by the current elevated IVs. If you are trading something like BHP, it is sometimes worth watching market depth closely for another retail trader on the opposite side who is coming in closer to that mid point. I have often been able to get better prices by being patient and waiting for such an opportunity. It really depends on how urgently you need to get the deal done.

Also, I have found if the MMs think you are a bit desperate, they will play harder to get. It's a bit of a tactical game, IMO

 

[long88]

Yeah, that's one of the many downsides of the Aus market. I am finding limited opportunities with options here in Aus, however, trading at night is out of the question at the moment, so I'm stuck with the what we've got here.

Bid/ask spreads are wider than normal - certainly not helped by the current elevated IVs. If you are trading something like BHP, it is sometimes worth watching market depth closely for another retail trader on the opposite side who is coming in closer to that mid point. I have often been able to get better prices by being patient and waiting for such an opportunity. It really depends on how urgently you need to get the deal done.

Also, I have found if the MMs think you are a bit desperate, they will play harder to get. It's a bit of a tactical game, IMO

hi sails, here is what i done. i sleep at around 11 or 12 at night, then woke up at 5:30 or 6 in the morning, and US market is still open.

remember last 2-3 hour will determine the outlook for tomorrow, you dont have to be awake to follow the market direction, there is nothing we can do anyway to control it, just flow with it, set your stop loss at the same time if your outlook not changed.

cheers

 

[wayneL]

FYI - Lifted from another forum, but do not know the source:

...
Was Fontanills really Wall Street's most respected hedge-fund manager? I asked the optionsXpress chief. "He ran a hedge fund that generated very nice returns for the years it was open," Fisher said. After saying Fontanills -- who still runs seminars under contract -- isn't an optionsXpress employee, Fisher's firm sent me 17 books by Fontanills and put me in touch with Chicago Board Options Exchange educator Jim Bittman, who said he taught similar techniques.

OptionsXpress gave me excerpts from a 2001 letter that Fontanills sent to investors in his Pinnacle Investments of America fund. These showed gains of 48% for 1998 and 83% for 1999, and a 24% loss for 2000. There was no mention of how much money was involved.

The fund's account custodian was a Salomon Smith Barney broker in Hallandale, Fla., named Jose A. Gomez -- Fontanills' friend and cousin. But e-mails from Fontanills to Gomez's boss on Sept. 10, 2001, show that Fontanills was trying to stop Smith Barney from liquidating his fund's account. "This will cause serious losses," wrote Fontanills, "and will essentially put us out of business." Neither Smith Barney nor the Options Clearing Corporation knew how to price his positions, Fontanills argued. Fontanills says he prevented big losses by moving the account.

In 2002, Smith Barney fired Gomez and the NASD then barred him for failing to provide information to investigators. (Barron's couldn't determine the nature of the inquiry.)

Fontanills ultimately closed the hedge fund, he says. "Managing money for other people is different from managing your own money," he told me in an interview.

The Bottom Line
OptionsXpress shares look overvalued after a strong run. The firm's bid to boost growth by buying a seminar group seems ill-advised, based on the record of the group's founder.

But Fontanills came to grief managing his own money, too. In June 2003, he opened a New York account with the French-owned broker Fimat. By November, according to a complaint Fimat filed in Manhattan's federal court, Fontanills had run up losses of more than $6 million. When he refused to honor margin calls, Fimat liquidated his positions and sued him for the $6 million. Fontanills again argued Fimat didn't know how to price his sophisticated options strategy or calculate the margin requirements. The dispute wound up before arbitrators, who ordered Fontanills to pay Fimat $1.8 million with costs. He paid.

...
After 10 years of applying his Optionetics strategies, Fontanills' wealth wasn't what you might expect. When opening his Fimat account in 2003, he listed his net worth as $4 million. Four months earlier, his sworn financial statement in a Massachusetts divorce court represented his personal net worth as $7,150, plus another $473,500 in a trading business. His annual income, he told the court, was less than $15,000.

"Both financial statements were correct at the time they were made," Fontanills said in an e-mail last week. He has a new trading business, incorporated in the name of his current wife, called the Robo Trader Algorithmic Trading Fund.
...

 

[mazzatelli]

Ugh, looks like he is resorting to algos and high freq. IMO the quant model is dead.

 

[wayneL]

FYI - Lifted from another forum, but do not know the source:

Here is the source of the Fontanills excerpt:

http://online.barrons.com/article/SB125392859854942915.html?ru=yahoo&mod=yahoobarrons

 

[Menage]

I did my Options study through Options University in the USA ( via correspondance & CDs etc) very very good theory from Random walk, Bell Curve, Options pricing, Greeks ( inc secondary) & every strategy commonly used.After this study I knew a lot about options but did not have a clue about Trading & in fact had never placed a trade in my life so I then did a 3 month mentoring course with Paul Wise at Options 21, during this curve I learnt how to trade, read charts, identify patterns etc & today some 8 months later I am doing pretty well with my Options trading, the beauty of it is that I am doing it all & nil brokers are giving me suspect recomendations. Yes it cost me a few Grand all up but I dont believe it would add up to more than an Optionetics education. I have not done Optionetics so I cant comment however I can tell you that the above two providers are well worth every cent that I spent with them.

 

[wayneL]

I did my Options study through Options University in the USA ( via correspondance & CDs etc) very very good theory from Random walk, Bell Curve, Options pricing, Greeks ( inc secondary) & every strategy commonly used.After this study I knew a lot about options but did not have a clue about Trading & in fact had never placed a trade in my life so I then did a 3 month mentoring course with Paul Wise at Options 21, during this curve I learnt how to trade, read charts, identify patterns etc & today some 8 months later I am doing pretty well with my Options trading, the beauty of it is that I am doing it all & nil brokers are giving me suspect recomendations. Yes it cost me a few Grand all up but I dont believe it would add up to more than an Optionetics education. I have not done Optionetics so I cant comment however I can tell you that the above two providers are well worth every cent that I spent with them.

From what I've seen of Ron Ianeri, I have a lot of time for him. He seems very genuine in teaching people what they need to know.

Never heard of Paul Wise, but looking at their site, they look pretty genuine too. Expensive, but you get Optionvue thrown in with the cost by the look of it.

IMO a different kettle of fish to The Big O and the pathetic dross that is generally available in Oz.

Good luck with it, sounds like you got a great start.