Initial Poll Results

Yesterday's poll questions provided responses that are surprising to me.  That prompts a few more questions.  My goal is to make this blog educational and enjoyable for as many readers as possible.

At this point in the polling (please vote), about one in six of the readers who responded consider themselves to be rookies and 70% have been trading options for at least one year.  Among that 70%, more than half have been trading options for at least five years.

As expected most (>75%) live in North America and the vast majority (86%) are sellers of option premium.  Six percent buy options. 

If the results change significantly, I'll report back, but you can see the status for yourselves by clicking on any poll question's 'view results.'

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In an effort to provide content that is most beneficial to you, I want to know whether the topics covered in this blog and the detail with which I offer explanations are suitable. 

Do you appreciate the extra detail I provide, or do you find it tedious, and would appreciate reading the material with less detail?


Do you want to see much more material geared to the rookie?  After all, my intention was to write a blog that would attract people who wanted to learn about options, or who had just begun trading.  I found so many more topics worthy of discussion that I expanded my blogging horizons.


For readers who have been trading less than two years: When you began reading this blog, did you consider yourself to be a rookie options trader?

8 Responses to Initial Poll Results

  1. kbluck 07/30/2009 at 2:26 PM #

    When evaluating these results, do keep in mind the “Above-Average effect”, aka the “Lake Wobegon effect”. This is the tendency of individuals to believe they are “better than average” at any given skill they wish to imagine that they possess. It has been well demonstrated that the less competence an individual actually possesses, the more likely they are to believe that they are much more competent than they really are, precisely because they are too incompetent to recognize their own incompetence.
    Conversely, the highly competent tend to underestimate their own competence compared to others. This is known as the “False Consensus effect”, an unwarranted assumption that one’s peers are performing at least as well as oneself.
    Interesting study on the subject: http://www.apa.org/journals/features/psp7761121.pdf
    In other words, just because somebody doesn’t *think* they’re a rookie doesn’t mean they aren’t.

  2. Mark Wolfinger 07/30/2009 at 2:54 PM #

    kbluck,
    Thanks.
    I see your point. I’m trying to discover how much time to spend on the basic concepts of options. It was my original intention to do that for a long time, but it did not work out that way. That seems to be ok with the large majority.
    What does surprise me is that readers would like even detail. And I thought my writing was already too detailed!

  3. TR 07/30/2009 at 11:32 PM #

    Mark
    If you were looking for ideas for posts…I would be very interested in your thoughts on making the decision whether to open IC’s by buying 3rd month IC’s vs 2nd Month IC’s.
    I beleive most conservative IC buyers would not want to open positions on front month IC’s (but maybe I am wrong). I personally have liked the 3rd month IC’s in the past becaue it has allowed me to open IC’s that are quite far OTM for a decent premium (e.g RUT IC’s with short strikes about 20% OTM still bring in about $1.80 of premium). However in some recent reading I have been doing, I have come across those who say that 3rd month options are to be avoided beacuse “a lot can happen in 3 months, even to an index”.
    I know that the question is somewhat a “comfort zone” question, but I would love to hear your thoughts on how we figure out our own comfort zone when it comes to opening 2nd month IC’s vs. 3rd month.
    Rgds
    TR

  4. Mark Wolfinger 07/31/2009 at 7:48 AM #

    TR,
    I’m always looking for post ideas, but this topic is one that I cannot really provide a great deal of insight.
    1) Most IC traders prefer the rapid time decay of the front-month. Too much negative gamma for my comfort zone.
    2) All else being equal, I like the idea of 3-month positions. Slight advantage to going further OTM plus higher premium.
    3) But to me it’s a vega decision. Because IC is short vega, I will not open 3-month positions when IV is ‘low.’ Because ‘low; is a relative term, it’s often not easy to make that decision. There’s no doubt that today’s VIX level is low by standards of the last year, but over the history of VIX, today’s implied volatility level is high.
    That makes the decision difficult for me, but I’ve been working two-month trades over the past couple of months.
    This is a comfort zone decision, but VIX level is my major deciding factor. Am afraid of a very volatile market when buying 3-month IC because IC prices will move higher. Insurance helps, but I don’t want to get caught short longer-term vega when IV surges.

  5. BB 07/31/2009 at 3:29 PM #

    I’ve traded options only a little but have read a great deal over several years and watched most of the pertinent vids at CBOE. For safety’s sake, I’ll consider myself a rookie until I’m able to deal with this material in a knee jerk way (but hopefully a well considered knee jerk) which will require me to go over both basics and advanced concepts repeatedly, in cycles. So I hope that when you cover advanced concepts you don’t speed through them using shorthand and a great deal of jargon, and remember to use a little extra space to cover the ideas in a way that assumes everyone here is striving to get the most from each of your daily posts, but working at a slightly different level of understanding and expertise.

  6. Mark Wolfinger 07/31/2009 at 4:22 PM #

    Thanks for the comment,
    I don’t think you have to be concerned. The vote to include at least as much detail as I do now is overwhelming. Readers like detail, and I prefer to explain the material in a way so that all readers can understand.
    I do not use as few words as possible. I try to anticipate and answer questions in the original post. Please feel free to let me know anytime I stray.
    Best regards,
    Mark

  7. Doug 08/02/2009 at 9:02 AM #

    Mark
    I’ve been trading options for several years but there are some basic gaps in my knowledge. I was doing quite well until I subscribed to a site that in my opinion was and remains a scam. I “learned” a lot from this site most of which was wrong. Caused me to lose quite a bit of money. But not like the investment club the guru set up with a minimum of $25,000 per member. He lost it all, 1.2 million, in 2 months. Site still going strong. Top grower on Seeking Alpha. I consider myself to be pretty sophisticated but I sure wasn’t this time.
    Your site is very helpful in my reeducation. Would like your book but have refused to pay 67€ + shipping. Actually finally bought in US for a friend to mail to me in France.
    Keep up the good work. Would like more on perils of assignment. Also FWIW it’s a bit hard sometimes finding things on specific topics.
    Keep up the good work.
    Doug

  8. Mark Wolfinger 08/02/2009 at 9:22 AM #

    I thought the idea of an investment club would work well and be efficient – but obviously it all depends on the ability and integrity of the person making the trading decisions. I’m sorry to hear of this unhappy outcome.
    67 Euro. Plus shipping. Wow. I think you found a good solution. If other readers have this problem, I may (or may not) be able to help. I would look into finding a solution.
    The ‘perils of assignment’ are few. But, this is a topic worthy of discussion. Thanks. I was planning a magazine article on this topic, but the editor cannot decide if she wants it. Perhaps the blog is a better spot for it!
    The specific topics issue does depend on what you are seeking. I asked for more specifics via e-mail.