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VIX "Aliens landing in Central Park" Hedge

Discussion in 'General Discussion' started by Joe A, Feb 11, 2017.

  1. Joe A

    Joe A Active Member

    A while back there was a great discussion in Trading Group 2 about an inexpensive, catastrophic hedge. I don't remember which session and I am wondering if someone could briefly describe that hedge here. I remember it was referred to as a hedge for "when aliens land in Central Park." Perhaps that will jog memories.
    I believe it is based on VIX calls. I would be grateful if someone could describe:
    --which Strikes
    --how far out in time
    --how to calculate the size needed to hedge a portofio ($100K, $500K, etc.)
    Many thanks, Joe
     
  2. DGH

    DGH Administrator

    Hi Joe. Well, aliens in Central Park (or on the Golden Gate) would certainly do it. Of course, there are many risks today which are even more likely but might be equally catastrophic. In any event, there have been several discussion about VIX calls and SPX teenies in both Trading Group 2 and the weekly Road Trip videos. Please refer to the Library on the forum site to identify the specific sessions in which they were discussed.
     
  3. Bill C

    Bill C New Member

    Joe A. Check the Library - Trading Group 2 dated Jan. 24, 2017 (Jon Bailey). Also, Road Trip Trade Alerts SPX dated Jan. 27, 2017 and the one dated Feb. 3, 2017. You can also log-in the Forums and search for "Hedging VIX Calls". Best wishes.
     
  4. Joe A

    Joe A Active Member

    Thank you, Dan and Bill
     
  5. ACS

    ACS Well-Known Member

    I'm not sure worrying about your option trades is the correct response to an actual alien landing, especially if they came to serve man.
     
  6. KiwiDon

    KiwiDon Well-Known Member

    I think I'll have to go with Mr Hawking on this one ;)
    "If aliens visit us, the outcome would be much as when Columbus landed in America, which didn't turn out well for the Native Americans. We only have to look at ourselves to see how intelligent life might develop into something we wouldn't want to meet."​
     

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