ExcelQuant tradingTrading strategies
UVXY is an ETF that targets 1.5x the daily returns of a 30-day constant-maturity position in VX futures – the SPVIXSTR index. Before 2018, it targeted 2x returns – but Volmageddon ruined the fun. UVXY has to trade every day: Anyone can trade UVXY in the market, and it trades close to the index because
Think like a traderTrading books
People often ask me for book recommendations. But here’s a better question: What’s going to help you make money today? Reading a book probably isn’t the answer. I’m not saying books aren’t useful. They absolutely are. But you’re not preparing for a PhD defence – you’re trying to turn money into more money through trading.
Think like a trader
I’ve noticed that beginners are often attracted to market making. To the uninitiated, it sounds like easy money and constant action. The reality, of course, is that market making isn’t the goldmine many think it is, especially not for beginners. In this article, I’ll explore why. Back in the early days of crypto, you could’ve
Think like a trader
Someone recently asked me if obsessing over FOMC announcements, Non-Farm Payrolls reports, geopolitics and other macro news is important for traders. My answer might surprise you: unless you’re actually a dedicated macro trader – which is highly unlikely if you’re reading my stuff – it almost certainly won’t help your trading. Let’s start with what
Think like a trader
A lot of my advice boils down to trading is hard, so go after the easiest stuff you can find first. Some call this defeatist. I call it realistic and practical. A big part of trading is not screwing up. So, at the start, learning skills, defining processes, and building confidence are important. A question
Think like a trader
Someone recently asked me about the difference between our approach and discretionary order flow trading and technical analysis. Order flow trading involves sitting in front of a screen and looking at orders and trades as they come in and trying to work out if more buying or selling is happening, where those trades are occurring,
Think like a trader
I notice that in conversations with traders, they often think about entries, exits, and discrete trades with some sort of life-cycle. But your P&L does not come from a trade. A trade doesn’t change your P&L much, except for the commission and spread costs that you incur. Your P&L comes from holding a risk position
Think like a traderTrading as a business
I work with many traders who aspire to turn their passion for the markets into a serious trading business. And I think this aspiration is entirely appropriate – it’s critical to approach the trading problem as seriously as you would any business venture. A question that always comes up is, “Where do I start?” In
OptionsQuant tradingRThink like a trader
In this article, we’ll use simulation and simple visualisations to build intuition around how different variables drive the price of an option. Building this intuition is important because it helps you react quickly and make decisions without relying on complex pricing models. Let’s get to it. The value of a call option at expiration A
OptionsQuant tradingThink like a trader
This post assumes basic knowledge of Options and Mathematical Expectation. Most of the features that you observe about options are simply due to the fact that they are expiring bets. And the features we observe in option pricing are observed in any other expiring bet. The complicated maths and terminology that surround options can make it
Quant trading
Read the previous parts of this 101 series on options: There are 2 good reasons to buy put options: Because you think they are cheap Because you want downside protection. You want to use the skewed payoff profile to protect a portfolio against large downside moves without capping your upside too much. The first requires
Options
In this article, we explore the payoff to holding long options positions. Read the previous parts of this 101 series on options: Payoff Profile of a Long Call So far, we’ve plotted the value of an option at expiration. This is useful (as we’ll see later), but it doesn’t represent our profit and loss from
Think like a trader
Think like a trader
Think like a trader
CryptoData analysisThink like a trader
Think like a trader