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is not indicative of future performance or success.
There is a substantial risk of loss in trading. You should therefore carefully consider
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YZ Income Fund - 80% drawdown during the February crash.
He lost all auto-traders after that, but now in April he just got four subscribers. Go figure … like lambs marching to the slaughter.
The strategy recovered from that drawdown and is now up 76% YTD. That’s all subscribers want to see, ignoring the “dark side” (i.e. reality).
This is a very volatile year as compared to last year, and February can happen again at any moment. I hope these new subscribers realize they can lose all their money in a heart beat.
Selling naked VIX calls with no stops. Writing was on the wall with the bump in October of 2014. Navigated Jan/Feb 2016 pretty well so everyone had faith. Then some real volatility returned… lol.
Developer (and C2) made a killing on subscription fees for a number of years. Thankfully only 6-7 subscribers took this drawdown on in Feb. Of course then developer realizes his track record is shot, shoots for the moon, abandons his system and just throws a ton of money around on puts and calls, because why not.
Actually those big gain after the drawdown are not possible. Another bid/ask glitch.
Since he lost all he’s subscribers and NON TOS. Those days he long vix options for 0.05. That never happened or traded in real life. But he was able to sell at the ask of 0.40.
If you were still a sub with this, u would have never recovered. There is no way an 1000 contract vix way way OTM would been bought for 5 cents and sold for .40 and he did it 3 times.
When this system was over 75% draw down. It should have been margin called or be done for. Just like $xiv
After the vendor lost all subscribers after the crash he increased the number of contracts he traded from an average of 20 contracts per trade to 1000 contracts per trade, a factor of 50. The problem with this is that it is not real. In real life a broker will not allow this many contracts to be traded if you are trading naked options which is the type of options that this strategy is trading (as opposed to long options) but instead there is a cap on the maximum number of contracts a person can trade relative to the size of his portfolio. This cap is determined by a formula set by the broker. The formula took into consideration many factors such as the volatility of the underlying stock (each stock have different level volatility, the more volatile a stock is the more risky it is) and whether the option is in the money, out of the money or deep out of the money (in general, in the money option is relative safe and is priced expensively while price for out of the money is cheap and very cheap for deep out of the money options). If the underlying stock is less volatile and its option is in the money then the broker may allow the trader to short the option using a maximum of only 25-30% of his capital as an example (the percentage are different among brokers). If the stock is volatile and the option is out of the money then the percentage may be 15-20% and 10-15% for deep out of the money options (again the percentage varies among brokers, it could be higher or lower). There is no cap on the number of contracts you can trade on C2 however. This vendor calculate that since he would never get any more subscribers again if he continue trading with the normal 20 contracts per trade unless there is a dramatic turnaround. So he decide to gamble by increasing the number of contracts he traded from 20 to 1000. If he win he maintain his good track record and could make it great. If he lose and lost all his money? well, it is the same as if he continue trading with 20 contracts as nobody would want to subscribe to his system again. So he have nothing to lose.
