LESSWRONG
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All of Sierraescape's Comments + Replies

Unforgivable
Sierraescape10

Hi, just curious what the startup is? I'd love to look into it

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Reasonable ways for an average LW retail investor to get upside risk?
Answer by Sierraescape50

Hi! I've made ~800% over the last 6 months with a basic strategy of selling options on highly volatile stocks (which I am confident in) and buying cheap OTM options on less volatile stocks to take advantage of any black swans. One of those black swans was GME, and without GME I'd be closer to a 250% or so increase (take that how you will).

A pretty safe strategy imo is to put most of your account into near-NAV SPAC's, then use margin to sell puts on stocks you would like to own. The SPACs have very little downside risk, and selling puts is fundamentally les... (read more)

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2SimonM
Kudos on your great returns. I don't have any particular quibbles with your strategy although I would caution other people to think hard about whether or not they have a good sense of what is "cheap" or "expensive" when it comes to single stock vol. Ending up on the wrong side of the next GME will be very painful. The "average trader" is not a particularly good benchmark. Performance is very skewed, and the vast majority lose money. I am assuming by "average" you are referring to median. The mean trader breaks-even (mechanically) as we're talking about a zero-sum game.  "Intelligence" isn't the only relevant skill. The difficult parts of trading are not usually "being smarter than the market" but things like:  * Having high quality information * Having high quality execution * Temperament