Thursday, December 13, 2007

SFO and the Rise of Dark Pools

SFO magazine typically has great articles and this month is no exception. The issue of Dark Pools is something I had vaguely known about, but had no real information about. This article changed all that, and now I've got to up my Lexapro dosage to overcome this new worry. But really. . .it's worth a few minutes of your time to learn a little bit more about Dark Pools since it will help you appreciate and understand how the deck continues to get stacked against the retail trader.
One way to avoid the problems with the Dark Pools is suggested in the article on Butterfly Nets, since this is a strictly premium decay strategy, although it can be set up with a directional bias. A bit complex to set up for some ( many platforms let you set up and enter the order as a single trade) , but Mike Parnos does a great job of explaining the risk/reward the setup and the ideal time frames. Worth a close look by option traders looking for another potential revenue stream.
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