moo
14 posts
moo
@urmoov
gambling life away on fake internet money
Katılım Mayıs 2020
1.8K Takip Edilen43 Takipçiler
@jimmmmmmmmmmmny @weaponizedFOMO i keep telling u gays
sell vol
u keep not listening
lesson in that
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did i sell vol?
no, i didn't.
but i'm gay.
what's your excuse??
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@ZeeContrarian1 What’s your reasoning for not structuring a trade on rates themselves if your view is that they’ll be higher?
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𝗣𝗛𝗔𝗥𝗠𝗔 𝗕𝗜𝗢𝗧𝗘𝗖𝗛 & 𝗧𝗛𝗘 𝗢𝗜𝗟 𝗦𝗛𝗢𝗖𝗞
The $XBI (biotechnology index) is down more than 5% this month, and the $DRG (pharma index) is down more than 10% this month!
The CEO of United Airlines was quoted over the weekend saying that his business plans are based on oil prices reaching $175 per barrel by the end of next year.
Exaggerated? Crazy? Not necessarily…
Also over the weekend, Qatar-having lost about 20% of its gas production capacity—estimates it will take 5 years to return to full output.
Forward oil contracts (currently ~$98 spot) for one year ahead are trading at around $76.
Despite all the manipulation taking place in the global energy market, it is still unclear whether the market is properly pricing in the long recovery time of energy infrastructure in the region.
Higher-than-expected oil prices would lead to higher-than-expected inflation, and a return to the not-so-distant reality of interest rates in “Higher for Longer” mode.
We have emphasized many times the high sensitivity of $XBI and biotech companies to interest rates-we won’t repeat that here.
On the other hand, pharma companies are much less sensitive to interest rates.
We are very surprised that pharma is down twice as much as biotech this month.
If we must give a forecast and we must—the trend could reverse with a meaningful probability.
If interest rates indeed stay “Higher for Longer,” it is quite possible that $XBI will take a hit as a risk asset, while $DRG may decline less, or even rise, as the market shifts toward safety.
Wishing you a quiet night and a blessed week
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The trade will make money vast majority of the time, but you don’t want to find out what happens when it doesn’t. If Vx remains in backwardation, UVXY rises every day all else equal and vol clusters.
You’re right, sizing is everything. Your size constraints on this trade should be a fraction of some of the less risky ways to play this.
You could just buy in the money puts on UVXY/UVIX that would at least make you long vol of vol while short vol. If there’s a true blowup, your puts wouldn’t get smoked.
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There’s so many less risky ways to express this market view without having to sell Armageddon insurance. If you’re going to do it, at least pair it with an ES short or something.
Z@ZeeContrarian1
$UVXY 𝐭𝐡𝐞 𝐭𝐫𝐚𝐝𝐞 Here is the explanation of the $UVXY trade. As we said before, the $VIX index is not tradable, and it usually spikes well above the futures when events happen because the VIX reflects the closest-term risk, while the futures themselves are further out on the curve. So let’s say we go to April. In this case, we’re selling the $UVXY 75 call and using the premium to buy a 46 Put. If $UVXY gets there, it probably means the $VIX reaches around the 40–50 level, and that the $VIX futures curve moves to around 30. Now let’s say I’m wrong and the $VIX spikes to 50 or even 60. I think we can all agree that the $VIX will eventually come down from that point. That means the call you sold will be assigned and you will effectively be short $UVXY automatically when the $VIX reaches around 50. I think we can all agree that shorting the $VIX around 50 is something you want to do. The probability of making money over the long term if you short the $VIX at 50 is essentially 100% as long as you don’t use leverage and blow yourself up. Now let’s look at the other scenario. Let’s say things calm down this week. Boom, you’re going to make a lot of money. I believe that within a month, $UVXY will be well below 40, regardless of what happens in the next week or so. So either way, if you think about it carefully, you almost want to lose money on this position, because then you end up shorting $UVXY from a higher level rather than a lower one. Either way, you win.
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Anything that doesn’t involved selling uncapped vol without atleast having something on the other side lol. Delta one long market, trading spreads, short vol/short market, trading skew on SPX(risk reversals). Immediate vol is coming from oil, can structure trades directly on oil too
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@taobanker How are you defining cheap here? Looks like stock moved down and iv crushed on earnings
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@urmoov @therobotjames Dont re-balance the position between its open and close.
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shorting dogshyt perp listings on binance
. . .
what happens immediately after a new perp is listed on binance?
well, on average they go very down.
future of finance innit.
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@MarkBestForex @therobotjames Just curious, could you elaborate on what you mean by constant coin risk?
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I was looking at this and it's interesting as the trade works as a long and a short.
If you use log returns (I.e. target constant dollar risk) shorting works as it takes the sting out of the rockets.
If you use arithmetic returns (constant coin risk) then longs work as the moon rockets pay for the losses.
I thought that was interesting and then did nothing with it. I assumed targeting constant dollar risk would be a execution/fee nightmare.
Its interesting too as each strat has different tailedness of the pnl.
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moo retweetledi
Data pipeline is ready: feeds are buffered into memory, parsed and timestamped on AWS then sent to Clickhouse hosted on an Hetzner instance.
I hope it's the cheapest option but I'm gonna be model MAXING
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The best way to get your positions to realize some upside volatility is to sell some covered calls. Most of the time it works every time.
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my execution platform gives me the same audio alerts when im over risk limits and selling vol
Turbine Traveller@Turbinetraveler
A pilot's-eye view in reduced visibility landing.
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