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Old 04-11-2015, 07:28 PM
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solarcurve solarcurve is offline
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You might remember me from http://www.actuarialoutpost.com/actu...37331&page=165

Anyway, I quit my office job nearly two years ago because I really didn't like it and decided to make a go of trading full time. It's been a long, impossibly difficult journey but I'm still here, so far at least.

I focus primarily on binary options on NADEX (www.nadex.com). I have a stock/futures account as well where I put my profits from NADEX but it is not that interesting really. I live stream my NADEX platform every day during market hours so you can see what I'm doing (only 2-3 seconds behind real time) - the link is http://streaming.anomaly.ws/?channel=ramsey

Here's a screenshot at the end of the day on 2/13/2015 where I made 10.1k net profit after commission - http://content.screencast.com/users/...855e/NADEX.png

Here's one on 2/18/2015 where I made 5.2k - http://content.screencast.com/users/...ee02/booom.png

All done completely live streamed. Thought some here might be interested in this. Completely free of course, just for entertainment purposes. I do have losing days all the time, but when certain things happen I can make a lot of money. Just try to keep the losers small and when conditions are right, hit it very hard.

Questions/comments, feel free.

Last edited by solarcurve; 04-29-2015 at 07:19 PM..
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Old 04-11-2015, 07:38 PM
goofball goofball is offline
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Cool. Glad to hear you've made it work so far!

How much have you made since quitting your job two years ago?
What is the trend in how much you've made (is it increaseing, decreasing, flat)?
What is your generalized thesis for why you have an edge in those markets?
What are binary options?
What general strategies and tactics do you employ?
How many hours (roughly) per day are you doing this?
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Old 04-11-2015, 07:55 PM
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solarcurve solarcurve is offline
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Quote:
Originally Posted by goofball View Post
Cool. Glad to hear you've made it work so far!

1.How much have you made since quitting your job two years ago?
2.What is the trend in how much you've made (is it increaseing, decreasing, flat)?
3.What is your generalized thesis for why you have an edge in those markets?
4.What are binary options?
5.What general strategies and tactics do you employ?
6.How many hours (roughly) per day are you doing this?
1. on NADEX from July 2013 to year end 2013 I made $43,300, in 2014 I made $1,400, and YTD 2015 I've made $48,500. In my stock/futures account, probably I'm up $13,500 YTD 2015. 2013 and 2014 didn't make much or lose much in that account so consider it a net wash.
2. Started off quite well in 2013. 2014 was pretty tough. 2015 is going very well so far.
3. There are two factors to consider: intraday volatility in the underlying markets like S&P 500, gold, etc, and how large the premium on the binary options is on NADEX. My edge is not really that I can tell you where something will be in the next 15-20 minutes, but that I can tell you where something should NOT be in the next 15-20 minutes. When the market sees a quick shift in intraday volatility, the pricing on NADEX options is often very slow to react. Exploiting this advantage is how I have made so much money.
4. watch this video https://www.youtube.com/watch?v=dJJxEhTEqCk
5. NADEX has 20 minute binaries on US markets during US trading hours. I mainly trade those and hourly binaries on gold in the last 20 minutes of each hour. I will do trades in other things but these two are my bread and butter. I buy between 80 and 90, sell between 10 and 20, Binary options are priced between 0 and 100. If you sell at 10 and it ends in your favor, you make the 10 bucks minus commission (90 cents per contract up to maximum $9). Same if you buy at 90 and it ends in your favor. It either hits my stop (usually get out around 50 +- 10) or ends in my favor. Rarely it will go against me in the so called 'dark period' (market makers stop making a market with a minute to go until expiration) in which case I would take the full 80-90 loss. So basically trading very short term options making an educated guess in where price will NOT go in the next few minutes.
6. NADEX starts trading S&P 500 hourlies at 8 am EST. Last expiration is 4:15 pm EST. I am trading every day between 8 and 4:15 all day. Most trades I've ever taken in one day is 58 but anywhere from 15-30 is normal in a given day.
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Old 04-13-2015, 01:05 AM
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How are you deciding where the price should not be?
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Old 04-13-2015, 09:20 AM
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solarcurve solarcurve is offline
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How are you deciding where the price should not be?
if ES (S&P futures) are moving around 1 pt per 5 minute candle on average, with 20 minutes to go I want to be two points away from price. With 10 minutes to go, I want to be one point away from price. If price is trending, I want to follow the trend. If in a defined range, buy below support/sell above resistance as appropriate.

http://content.screencast.com/users/...b893ff3/ES.png

Friday for example, by 10 am it was clear odds are we grind sideways to up. So I bought every 20 minutes. Then later it became clear we had entered more of a defined range, so when we were near the bottom I bought and near the top I considered selling but selling was riskier as we could have broken UP at any time I thought. Had 20 wins, 1 loss on Friday and 90% of that was just buying the farthest strike under price I could every 20 minutes.
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Old 04-13-2015, 09:32 AM
lulzEMH lulzEMH is offline
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Who are you re generally trading with? The MM?

I guess I'm asking because I've never really heard anybody talk about the binary option market other than you on this forum and normal options can be pretty illiquid/expensive.

Does this market maintain pretty reasonable spreads (other than the last minute or two)?
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Old 04-13-2015, 09:41 AM
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solarcurve solarcurve is offline
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Originally Posted by lulzEMH View Post
Who are you re generally trading with? The MM?

I guess I'm asking because I've never really heard anybody talk about the binary option market other than you on this forum and normal options can be pretty illiquid/expensive.

Does this market maintain pretty reasonable spreads (other than the last minute or two)?
There are two MM's. When both are active, spreads can be as low as a dollar or as big as 6-7. When only one is active, spreads are over 10 bucks and I usually don't trade. Most of the time both are there though. When it gets to a minute till expiration, both MM's stop making a market so you are basically locked in to the position until expiration.

Binary options are a VERY different animal than regular options. The MM's make their money from the spread and from retail traders losing money on NADEX. MM's are not offsetting trades in the underlying market like they would on regular options.
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Old 04-16-2015, 06:39 PM
lulzEMH lulzEMH is offline
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Quote:
Originally Posted by solarcurve View Post
There are two MM's. When both are active, spreads can be as low as a dollar or as big as 6-7. When only one is active, spreads are over 10 bucks and I usually don't trade. Most of the time both are there though. When it gets to a minute till expiration, both MM's stop making a market so you are basically locked in to the position until expiration.

Binary options are a VERY different animal than regular options. The MM's make their money from the spread and from retail traders losing money on NADEX. MM's are not offsetting trades in the underlying market like they would on regular options.
It's impressive that you've made money trading these given how large the spreads are.
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Old 04-16-2015, 07:49 PM
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solarcurve solarcurve is offline
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It's impressive that you've made money trading these given how large the spreads are.
Should see some improvement in spreads by the end of this year. But even with spreads over 10 bucks, when the stars align and the options are wildly mis-priced compared to underlying volatility you can still make a lot of very easy money. Most days are a grind, no question about that - and tighter spreads would help tremendously. Still, the reason I do this every day is to keep my edge sharp, stay engaged, and be ready for when things do fall into place.

You could probably just take my best 10 days in Q1 and capture 80% of what I made the whole quarter. But if you don't show up every day all quarter, you may not be around one of those big days. It is a constant discipline/patience check.
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Old 04-17-2015, 11:41 AM
donny5k donny5k is offline
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Does NADEX just exist for speculators or is it used for institutional investors to hedge? Or is it just small potatoes enough with not enough liquidity for the automated traders to come in and wipe out your edge?
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