Once in a while, short volatility strategies will be hit by event like this. Let see how many of them can survive. Try your best not to have your account blown up, so that you can live another day to trade.
Survived! And up 25% on it…
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yeah also no problem of a problem with our strategies. Known future events are easy to avoid, sudden surprises are toxic.
The markets recover from the “BREXIT” event pretty quickly. The sell-off actually lasted for just 2 days, and the pull back was not as deep. Pretty sure a lot of people can survive this event. For short volatility traders to survive a vol spike, it comes down to two things: a stomach to swallow 20%+ drawdown in 1-3 days and could be more, and an account with sufficient margin cushion to swallow the drawdown and potentially the margin increase.
Then did you see that 20%+drawdown occurred in those strategies?
Would you point out which of those strategies increased its drawdown by 20%+ after brexit?
my strategy survived…Check it out
The better volatility systems engage in market timing, including going long volatility when conditions dictate. Any idiot can buy levered funds on leverage and look smart until the tide goes out.
See my systems at XIV Timer and Fast Nickles,
