What other bloggers are saying

Interesting post by the (link no longer works)

"Garry Kasparov, the legendary chess champion has written a fascinating article entitled “The Chess Master and the Computer” in the New York Review of Books…Kasparov makes some remarkable comments with relevance to the Texas
Holdem Investing concept and how perhaps poker may now be the best game
for teaching risk.

According to Kasparov learning poker can teach people that there are no rewards without corresponding risk. This is one of the most vital lessons that must be learned before putting your money at risk in the investment world. Texas Holdem Investing shows how to systematically approach learning poker so that you can embed this lesson into your mental circuitry before swimming with the investing sharks."

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Please forgive me.  I had a very emotional day and cannot write more.  I'll be back tomorrow

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3 Responses to What other bloggers are saying

  1. Andy 02/04/2010 at 2:33 PM #

    Mark,
    Sorry to hear about things being rough, I hope it’s not too serious.
    When you get time to blog again, I was hoping to get your opinion on when to close a spread when things are down. This is in direct reference to a RUT bull spread I mentioned a few weeks ago, when I was trying to hedge against good earnings.
    As you are probably aware, RUT made a complete 180 and started dropping steadily after a seemingly insurmountable rise, right around earnings time. I had set 600 as my exit mark, but then it stabilized and then it was all but forgotten.
    Now with today’s events, we’re suddenly closer to 590 and I still own my bull spread (570-560), but we’re also closer to expiration day.
    So my question is: do you adjust your exit point based on date of expiration?

  2. Mark Wolfinger 02/04/2010 at 3:04 PM #

    It’s ok. I was just drained.
    1) To me, a RUT bull spread is a call spread that you own.
    This trade is “I’m short a put spread”
    But let’s not discuss terminology
    2) You had a plan. You violated that plan. Did you have a very good reason?
    3) ‘All but forgotten’? That is unacceptable
    4) If you plan to collect every last penny and allow options to expire worthless, you are going to run into many situations such as this one. That is one of the prices that must be paid when a position is thought to be worthless and ‘all but forgotten.’
    5) Yes, I adjust my exit point based on expiration. But only slightly. If 600 is my exit point, I may give it 595. But that’s all.
    We all hate paying the large premium associated with options that have a short lifetime. But that’s a necessary part of the game.
    Your comfort zone told you 30 points OTM was the limit. Now it’s 20 point OTM. Not good.
    6) I don’t know the size of your position, but perhaps you can cover one or two-lots.
    7) You are in high negative gamma country – and it only gets worse from here.
    You can hope for a rally; you can hope for a steady market for a couple of days; you can hope for a lot of things. Hope is not a strategy. And the probability is still about 65% that the spread will expire worthless. But are you willing to take that bet?
    There is no one to help with that answer.

  3. Larry 02/04/2010 at 8:46 PM #

    Mark, just wanted you to know I was thinking and praying for you. Please get some rest. No need to respond.