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I said I would create a separate nexusfi.com (formerly BMT) journal to share on this subject, that hasn't happened yet. In the mean time I have created this trade review - and I will follow up with another video comparing a spread trade.
Yes, a 69% loss could be the type of loss that ends your trading career.
I would say this reinforces the need to be mechanical in your stops with Options, although not always possible in a true crash like we had where there are moves that cause the market to hit the breaker. I had Stop Limits in place but the crash jumped over them and in one instance the Bids completely disappeared for hours on end so I wasn't getting out no matter how bad I wanted to.
What I don't like is that they keep say "we were forced to roll our spreads at no cost" when in reality When you roll a position, you’re buying to close an existing position and selling to open a new one.
Someone who is naive would think you could just roll forever to get out of bad positions
A similar thing happened in 2007 - I measured moves in terms of ATR, i.e. 1ATR, 2ATR, etc. Before the crisis began moves of greater than 2ATR were highly unlikely. Once it got into full swing moves greater than 2ATR were much more common.
Michael Harris just posted a piece on the frequency of 2 1/2% moves in a downtrend.
As he states he is using close < 200-day moving average to define one.
No specific point to me posting this other then a tie in with the 2% moves.
://tinyurl.com/nb79wgf
PS Can't post links yet so add http
PSS Sorry. No bad intent meant by workaround.
Probably because that's what they hear on TastyTrade.
(I'm paraphrasing and being a little bit of a smart alec, but based on some conversations I've followed about TastyTrade, they have a tendency to stick with a losing options trade, convinced it will come around eventually).
