Chat With Traders 248: David Sun - Systematic Options Trading - Minimize Risk, Optimize Edge
20 snips
Nov 22, 2022 AI Snips
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From Selling Puts To Launching Hedge Funds
- David started selling puts early, made money for years, then lost much when the market turned and stopped for a while.
- Tastytrade reignited his interest and he launched his first hedge fund in late 2018 and a second in 2021.
Options As A Return-Enhancing Overlay
- Options can be an overlay to enhance returns on a passive buy-and-hold portfolio without replacing the core holdings.
- Using options as a layered tool changes portfolio profiles while keeping the core benchmark intact.
Use Profit Targets And Hard Stops
- Use profit targets and hard stops on short option sells to cap loss size and lock profits.
- For example, take ~60% of premium as profit and stop out at a net loss of ~200% to fix a win:loss ratio.