ikkyu

The Pundits I Admire Are Turning Bullish

"I have no idea where the market will be three or six months from now. But 10 years from now, do you really think the Dow will be trading at 8,000? I sure don't."

I live in Japan. No one here thinks 10 years is a sure bet for a stock market recovery!

Cheers,
john

Does the VIX Need To Spike In a Climactic Low?

Greetings,
I am intrigued by your analysis. I might add that options trading itself has probably changed in the last 22 years, which would have some bearing. Also, volatility on carry trades, 20 year bonds, emerging markets, efa and so forth might suggest that fear isn't quite "close enough". Granted many weak hands have been shaken out, but this is a hard trade being either long or short volatility (as you said).

Cheers from osaka,
john

Housing as an Inflation Hedge: It's Not Magic, It's Leverage

Amazing how your little linked math thing completely left out the COST OF CAPITAL! Um, yeah leverage ain't free dude....

Mr. Market Warns of a Downtrend

Thanks. I like your measured use of technical analysis.

Cheers from osaka,
john

Volatility's Surprising Impact on Stocks

If you can turn that into a tradable strategy. you are my hero!

Don't Put Yourself in a Losing Position with Options

To the author from wikipedia:
"A covered call is a process in which one owns shares of a stock or other securities, and then sells (or "writes") them off in their corresponding amounts (call option). Payoffs on the stock are always the same, as with a short put option, hence the price (or premium) should always remain the same, as with a short put or naked put."

Don't Put Yourself in a Losing Position with Options

Pocipoci,

You really don't understand this do you. Go to optionetics or some other resource and compare the risk graphs of naked puts to covered calls and you will see that they are EXACTLY the equivalent in terms of money risk. Guess what? when the stock declines the covered call position losses money!
Unbelievable.... getting flamed for something that is in every academic options textbook!

Don't Put Yourself in a Losing Position with Options

Err... Options 101 will show you that selling a naked put or writing a covered call is the equivalent position in terms of risk. Most covered call programs begin with writing naked puts until exercised and then writing the covered calls.

Why not just stick to indices if you are afraid of news?

Alan Greenspan's Take on the Future

Very nice article. Thanks!
cheers from osaka,
john

Extreme Bearishness a Definite Bullish Sign

Greetings Mr. Trent,

Conventional wisdom says that the masses are "right on the trend, wrong at both ends". Would you say that this statement is false or that we are at an "end" ?

Cheers from Osaka,
john

Volatility Near Historical Lows: Good Time to Buy Portfolio Insurance?

Mr Kang,

Thanks for this. Addtionally, the put/call ratio is at a 6 month low. Short interest is rising but well below its all time peak of several weeks ago. I think everyone is gun-shy form previous short attempts!

I find that 20 period bollinger bands around VIX/VXN are very useful to show the relative vola of vola.

Cheers,
john

Embracing the Market's Volatility: My Investment Grocery List

Thanks for your post David.

I respect your approach. For me, it makes more sense to pick your (actually probably my) 1 or 2 fastest horses and hedge judiciously. less risk, greater reward! As for living life, I am with you there hombre.

Best wishes from osaka,
john

Embracing the Market's Volatility: My Investment Grocery List

Greetings,

Doesn't 30+ stocks start to replicate an index? Where is the edge there? Also, why do you dismiss hedging as a "ploy"? It works well for Buffet.

Cheers,
john

Utilizing ETF Puts: A Different Approach to Portfolio Protection

Greetings.
Your comments are worthwhile. It amazes me how "sophisticated" investors still shy away form the use of options in portfolio design. The only two things that might be added to your treatment is that 1.) your intial portfolio selection would probably be altered if you were going to employ options and 2.) options are relatively "cheap" now, so postponing the hedge a few weeks or a month could prove expensive.

With #1, you find yourself seeking volatility rather than shying away from it and concentrating one's portfolio rather than diversifying it. Adding options as an afterthought is not going to be nearly as effective as designing the portfolio for use with options.

get a few thoughts...

cheers,
john