In this episode, Jeff Malec sits down with David Sun, an entrepreneur, trader, and fund manager with a unique journey into the world of options trading and alternative investments. David shares his unconventional path, starting as a retail trader experimenting with options strategies, particularly selling puts, before transitioning to professional fund management. He discusses the challenges and lessons learned as he navigated various market regimes, including the 2018 and 2020 downturns. The conversation delves into David’s systematic approach to options trading, focusing on risk management techniques like stop losses and hedging strategies. He explains his evolution from primarily selling options to incorporating more option buying, as well as his exploration of zero days to expiration (zero DTE) options and the unique risks and considerations involved. David also shares insights into the role of behavioral biases in the markets and how he leverages data-driven research to develop robust trading strategies. He reflects on the increasing accessibility of trading tools and resources, and the valuable contributions of the retail trading community.
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Check out the complete Transcript from this week’s podcast below:
Retail to Institutional: How David Sun Scaled His ODTE Options Strategies
Jeff Malec 00:06
Welcome to The Derivative by RCM alternatives, where we dive into what makes alternative investments. Go analyze the strategies of unique hedge fund managers and chat with interesting guests from across the investment world. Hello there. Hope you’re doing okay following the election here in the US a bit of a pall of gloom over Chicagoans, to be honest, even with those US markets screaming higher the day after the polls close. But anyway, hang in there, or don’t celebrate too much, depending on your side of the vote, it’s usually never as bad or as good as it seems. On to this episode where we chat with David Sun, who went from retail options trader to running a small fund. David has some interesting takes on how and why he approaches options trading and zero DTE the way that he does, including the idea of whether he’d be better off not learning any more about it for fear of removing what makes him different than others. That’s a new one. David talks about his custom metrics for measuring the risk, return profile, use of stop losses. And we debate whether volatility, risk premium is an edge or just a factor, whether it even matters. Send it. This episode is brought to you by RCMs managed futures group, looking at vol traders like David or emerging managers like David, is a bit of both question about why one program another performed the way it did. Give our team of specialists a call and get the inside scoop on dozens of funds and CTAs we work with, visit rcmults.com to learn more. Now back to the show you. All right, everybody, we’re here with David Sun. David, how are you? Hey, I’m
David Sun 01:51
good, Jeff, thanks for having me on
Jeff Malec 01:52
Yeah. David is entrepreneur slash trader, slash fund manager slash podcast host, wearing a lot of hats. Yeah, you have the most common zoom background, but you’re not actually in the Bay Area, right? That’s
David Sun 02:08
correct. Yeah, I’m in the East Coast. I usually have that the outer space one, but then people always joke, oh, you’re calling from space, but
Jeff Malec 02:16
love it. Where are you in East Coast?
David Sun 02:17
I’m near the capitol in Virginia.
Jeff Malec 02:21
All right, so let’s start little you kind of have a unique entree into this space, having been a retail trader basically before you became started doing it professionally. So talk a little bit about that journey if you could, and what made you think you could do this for him?
David Sun 02:42
Yeah, sure. So I don’t have any formal finance background, education or pedigree, if you will, actually my backgrounds in electrical engineering. I was doing my master’s at Princeton. This was around 2008 2009 so interestingly, you know, even if you weren’t into finance, right, the market was probably on your mind around that time, during the GFC. So I just kind of thought I might get into trading stocks, and not, you know, I had no idea what I was doing. I was watching Man money, Jim Cramer, and just, you know, just just picking random stocks. And so I had a friend there that in Princeton that knew about options, and he was like, why don’t you try options? So the interesting thing is, like, so I got into Options very early, right? I didn’t really do a lot of stock trading, or day trading, if you will. And not only that, he got into me. Got me into options through the idea of selling options. So I didn’t have that first step that people usually make the mistake we’re buying options and trying to make big bets, leverage bets and, you know, and fighting theta and all that. So selling, put writing was basically what I started with. Now, granted, there was not really anything scientific back then either. It was literally Okay, instead of picking the five stocks that Kramer talks about, on on Mad Money, sell puts on those. And super naive, you know, just looking at the option chain selling the monthly and being like, oh, you know, you can get 1% for a month. And okay, if I just do it 12 times, and if I roll in when I’m challenged, you get 12% and, you know, it seemed easy
Jeff Malec 04:18
and good time to be selling puts after the after the crash, a good time
David Sun 04:22
to be selling puts. So, of course, it worked for, you know, a couple of years, made a decent return, but again, like, eventually the market turns and, you know, things kind of, you know, I didn’t blow up, but it was like, Oh, this is not so easy. So kind of took a little bit of a break, just because it was like, think about my first house. I took some money out. But, you know, at my I had a friend who he knew I was into Options, and he actually had some money, I think was managed by like Morgan Stanley or something. I forget who it was, but he wasn’t happy with how its going. And he was like, hey. Can you try to get back into this and learn, learn again, and so we can kind of learn together. And so I was, I was looking at a lot of different online content for mostly retail oriented stuff, you know, the tasty trays, option, alphas, and really, kind of just doing a DIY, but like learning as I went engaging with other Online Communities, and there’s a lot of sophisticated retail traders. I know they kind of get a bad rap, especially if you look on like Tiktok or YouTube all kind of like the trash videos and yeah, you know, if you will, but you’re
Jeff Malec 05:32
kind of going existing at that time with the Wall Street bets and all that stuff too, right? Personally,
David Sun 05:38
I never did because I wasn’t into Reddit, but I knew about that space, but so there was a lot going on, connecting with a lot of people, kind of learning and honing my craft and just getting, finally learning the Greeks. And so this was around 2017 that I kind of really found my footing year and a half later. You know, you asked me about how I got the idea of starting a fund, and how I thought I could do, you know, I don’t know what got into my head. It was just like, Okay, I’m having some success. And it seems like if I could raise some money, I could be doing the same thing I’m doing now, just trading larger account, right, using other people’s money and my money, and, you know, getting paid, right? Because trading is kind of like the ultimate, or just asset management, like the ultimate scalable business, right? You just get more money, and you get paid, and you’re basically doing the same thing. I mean, maybe that’s a little, a little reductive. Obviously, there’s more involved than that, but so I launched my first options based fund around late 2018 it’s interesting, because the timing was great. I launched october 2018 right into the next sell off. This was kind of the 20 you know, December 2018 right? Yeah, I got what it was, something with what, I think it was interest rate related. But Mark had a big sell off, so
Jeff Malec 07:04
until they actually went down that December, right? So the market crashed in the mini crashed,
David Sun 07:10
yeah, yeah, exactly, yeah. A
Jeff Malec 07:13
lot of people we’ve had on this podcast had a tough December of 18,
David Sun 07:17
definitely. And then 2019 another stroke of luck. Market recovered, got that redemption arc funded well. And then, of course, 2020, happened, COVID. And so, you know. And then 20, you know, interesting. 2021, market rally. 2022, and so there was so many different market regimes that basically happened. It was like three bear markets in a space of six years. So it was a lot of good learning experiences, just enough to learn the lessons, but not so much that, you know, went under or blew up. So I think the timing was very fortunate in that case, that like was able to, like just get through all of these different experiences and really make the most and and get a lot of takeaways.
Jeff Malec 07:59
And that’s always you talk to a lot option people like, Oh, I’ve tested this, right, this strategy through XYZ, you know. Like, well, how often, right is it statistically significant for those events that have only happened a handful of times in 40 years? Yeah, exactly. Statistically significant to test those into your model at all? Yeah, yeah, it’s,
David Sun 08:21
it’s hard to say, because like, through it, yeah, live through it. And of course, you want to test through it as well, because you kind of want to know what those periods of stress are. And I know we’ll talk about probably August 5 in a little bit here. But that was just another never seen before, kind of event, right? Confluence, a lot of different, different things, but just to kind of finish your story, so 2021 we spun out one of our strategies. We’re just focused on zero dt, SPX, and we just made a kind of a zero DTE focused fund, and that was, you know, 2021 so I’ve been running two funds since then, and then here we are now five five and a half years later, you
Jeff Malec 09:04
take me a little bit through that like So surely, with some nervousness there, right? Of like managing other people’s money, or did you were fine with that mentally, right? I think it is ultimately scalable. It is an easy transition. Instead of doing two contracts or doing 22 whatever the case might be, but a lot of people can’t handle the mental anguish, right? Of like, Oh, I just lost $10,000 for my uncle, or whatever the case might be. Like, how did that work out with you? You were fine with it, you
David Sun 09:33
know, I’m either super naive or overconfident. But the way it played out, we started with, you know, I seeded it with my Personal Capital, and it was very little other people’s money. At first, I kind of did the thing where I had an incubator set up, but then I felt like a track record with real, you know, LP funds. But even if it’s a little it’s kind of different than an incubator track record with just my own money. I don’t know. It just feels different. So I went ahead and launched. I was basically not covering my expenses. I was paying out of pocket, right? And that was the case for two plus years. And so I guess there wasn’t a lot of other people’s money to like be worried about. I guess it’s mostly just grinding, trying to trade the strategies and still capital raising at the same time. And it’s kind of the typical, you know, hear about a new business, right? The three year trajectory is like the two or three year grind, until you kind of hit that, that escape velocity, and actually get enough funds to first cover your costs and be profitable, and then it kind of just, it just took off from there. So again, maybe just kind of that timing aspect, it just worked out that way. I was able to kind of get through the lessons without having too much other people to worry about, and getting calls and stuff, and I found my footing and everything kind of just worked out that
Jeff Malec 10:56
way. What would your advice be to other people trying to do the same thing? Don’t, don’t quit their day job, keep a funding source on the side, and then let this grow. And when it when it hits, it hits,
David Sun 11:08
I would say that definitely helps if you have the luxury of some kind of job that has flexibility. And you know, if you’re going to be trading like it depends what you’re doing, if you’re doing. If you’re doing if you’re day trading, you have to watch a screen. That’s totally different. But we’re mainly automated, systematic trading. So during the day, there isn’t much. No, we’re not watching a screen, per se. Like, if there’s some kind of risk you got to manage, we’ll get an alert or something. But other than that, I think most of the work was like, asynchronous to the market, hours back, testing, doing research, sending them calls, or whatever. So so you can manage that. But I think if you have to depend on your fees as your sole income, it’s gonna, like, lend kind of this. You never want to be desperate, but like, you have to make profits to feed yourself, because that’s going to change how you approach you know, you’re trading, and so much of trading success is based on conviction and discipline, and so you have to be able to to, to manage those emotions. And it’s not going to help if you’ve got this other thing, like, hey, like, I need this, you know, need this gain, or else I’m not going to
Jeff Malec 12:17
pay for the wedding or whatever, right? Yeah, the and what was that? So you said at Princeton, what was your education in? So it wasn’t in quantitative finance. What was in it? No
David Sun 12:28
electrical engineering. So nothing to do with finance. But, you know, I always say at the very least, I got, I got a good grounding in math, which helps, right? Because what we do is all kind of, you know, it’s funny, like I say, you don’t even need to know calculus if you know algebra and you have kind of some basic statistical foundations and probability and just not really even super complicated stuff, like, you can, you can do this job.
Jeff Malec 12:54
Yeah, it’s fine. We’ve had, I should actually go back and count how many? But so many managers and traders on the podcast who came out of engineering either electrical actually is itself or just general engineering, because I think their brains think of the market as a problem, right? And we can just build the solution to fix that problem. I will often argue like, Are you sure it’s a solvable problem, right? It might be an illusion of, it’s a solvable problem. What do you think about that? Is it, do you think it’s ultimately solvable, or you’re just trying to exist in a semi solved state?
David Sun 13:31
You know, I think that goes to the idea of knowing if you have an edge. I always say, like when you’re when you’re trading right? Ultimately, you just have to take what the market gives, and your job is just a risk manager. And so this is also related to developing strategies and back testing. And people talk about curve fitting and whether or not you just fall by randomness. That’s what I thought of when he said, Is it a solvable problem, or is before by randomness, right? And the idea is, I think there’s some core principles, like, we rely a lot on what options is, volatility, risk premium, and there’s a lot of literature and reasons why that exists, right? But you have to fundamentally believe that there is some edge in overpricing of options now that can be used on the sell side or the buy side. And then there’s, you know, whether or not this equity risk premium or positive drift market go up long term, right? You take advantage of that. And of course, like factors like momentum and trend, which ultimately, I think, go back to behavioral biases, where there’s reasons for that momentum and trend exist that’s rooted in either information not being propagated immediately, or there’s emotion, you know, people are greedy or fearful, and so they either buy too much or they sell too much. And so there’s reasons and kind of drivers behind these ideas. And you for us, we always want to distill our strategy back to we believe there’s this edge here. So. When we say, solve the problem, right? We’re not trying to create some additional source of edge that’s like, not known, but we’re just trying to kind of manage our risk, right, develop strategies that can take advantage and harness those edges without taking on, you know, huge risk. And so solving their problem is really just surviving. I guess that’s where it comes down. You can survive, then that’s for us, is solving the problem.
Jeff Malec 15:28
But what would you call VRP and momentum and those edges are those just factors, right? They’re just,
David Sun 15:38
I guess, you know, this may be partial due to the fact that I don’t, I don’t have that, that formal background, but for me, like, how would you differentiate those two at the end of day, the day, there’s some concept, or some reason why there is a business model or some driver of the profit, right? So, yeah, maybe I’m not using term correctly, but like that, that’s kind of how I think of it. Well,
Jeff Malec 16:01
then that would be a factor like this. This ability to take this risk and make this money is driven by this factor, which, right, volatility, risk premium, right? The fact that options tend to decay into expiration isn’t an edge, so to speak, right? That’s nothing. It’s well known. It’s all over the everyone’s No, right? So that would be my difference, like an edge is I’m at a prop firm here in Chicago. I’ve got better technology. I can put big bids and offers in on small options that retail can’t match. And right? I’m I’m front running and all that stuff. That’s an actual edge where they have either pricing or information or technology edge, right? Or in trading it, right? If I’m a hog trader, and I know that the right with all my contacts, I know that the supply is going to be lesser than what comes out in the news, or something of that nature, that’s an edge, right?
David Sun 16:56
One thing that reminds me of though, so I’ve heard there’s kind of four sources of edge, right? There’s information, as you mentioned, you have some information that nobody else has analytical where you have the same information, be able to analyze it in a way that’s different or better. There’s sort of technical or, like I said, execution, where you can just do that thing better or faster. But the last thing is kind of behavioral, and basically, if you kind of know there are certain tendencies for humans to react a certain way, and maybe that’s, you know, related to like market flow, for instance, if you know there’s behavioral biases, you can take advantage of that. But as I mentioned, I think that’s that, in of itself, is kind of related to VRP and even momentum and trend. So maybe that’s why I kind of conflated to like is conflicted too. Like, is that an edge factor? So that’s what I’m kind of getting at.
Jeff Malec 17:45
Yeah, sort of agree with that, right? Of like, the ACT BRP itself isn’t an edge. To be able to trade it and not blow out that could be in it, right? Like, that’s what you’re saying. The behavioral, the structural, like, to be able to risk manage that factor could be the edge, right, right. Let’s dive into the models a little bit to the strategy. So, as you mentioned, you went through all those different periods, those three market quote, unquote crashes or downturns in short period of time. You started from an option seller, and then did you morph into more protection, or different sides of the trade? How did it more from, like, pure premium? Yeah, to what you’re doing now,
David Sun 18:33
we morphed into more protection and even into more buying. So we kind of sell and buy depending on what we’re trying to capture. But just to go to the beginning, like in the beginning, when I was thinking of just the idea of over priced options right, and trying to capture that, the very basic strategy was just selling puts, right. A lot of people do that. And one thing we started with was just selling weekly seven DTE puts at a things like 15 Delta, and just sell those puts. And at first, I kind of was thinking, hey, you know, as long as your size is small enough, if you don’t manage these, you can just sell them. And yes, you don’t want to go so much that the market goes down 10% you blow up. But the idea that if you can sell the puts, you’re going to collect that VRP over the long term, right? So there’s a there’s a terminal positive expectancy, not not accounting for the path, right? Obviously, you can have drawdowns and such.
Jeff Malec 19:27
But I guess some would argue, Sorry, I interrupted, that the selling puts his terminal break even, right, that you could make 100% over 10 years and then lose it all in the 11th year. But so you’re saying, you could model it to say there is some positive aspect.
David Sun 19:43
I think, at a certain out of the money range, there is a certain amount of terminal you know what? One term I use is called premium capture, or PCR, basically, if for every $100 that I sell in premium, how much. Do I net at the end of the day, net of all the losses in the money, stop loss, whatever it is. So I tend to think the PCR at, at a, let’s call it a 10 to 15 Delta range, is going to be a little higher than kind of like at the money, if you’re just selling straddles. I don’t think there’s going to be that much that you expect to gain or lose, buying or selling. But as you said, 2018 happened. Drawdowns were large, and so we’re like, look, we have to, we have to manage risk, and we we just use a simple idea of a stop loss. I know there’s a lot of debate and a lot of controversy over stop losses, especially dealing with options and execution on that. But, I mean, we can get into that a bit, but just if we just think about this way, if I sell an option, my max profit is the credit, right? And so there’s going to be a certain win rate. And if you sell 15 Delta, it’s probably gonna be like 80, 85% for instance. But if your losses are too big, right? Even if your terminal win rate is or expectancy is positive, like you can’t scale that strategy, because you’re just gonna have drawdowns that you can’t overcome, and it’s just too risky. And so if I do a simple let’s just call it stop out at 2x right? So if I’m collecting $100 I’m gonna stop out if I’m challenging, the option is selling for three, right? If it’s tripled in price and I close it out. So I collected one, I closed it for three. By the close, my net loss is two. So I’m using a simple number. I’ve risked two to make one. And if you use a stop loss, your win rate is going to go down. This is known, and this is another reason why people argue against that. But the idea here is, when we model expectancy, you have three variables, your win rate, which a lot of people focus on, the win size and your loss size. I think the loss size, the size of your losses is what’s overlooked a lot. Yeah, what I tend to do is focus on the win and loss size and let the win rate be the variable. If we go back a second, if we have no stop loss, 15 Delta put, whatever Delta put, you have a certain win rate. If you cap the losses risk to to make one, your win rate is going to go down. But you know your risk reward profile, so at a risk to to make one, your required win rate to make money is two thirds, 66 equation. Yeah, it’s just an equation. So if you can find a strategy where you can, you know, kind of engineer that payoff profile, then all that remains is to see where the chips fall. What is that win rate? If it’s high enough to be plus EV, right? Then just run that over and over again. And so it’s just become this, go ahead, yes,
Jeff Malec 22:55
I think the argument to that would be slippage. You lose connection, all this kind of stuff of like, you can’t guarantee that, um, two to one loss. You could argue over time it’s going to be close to it. But I think that’s what scares people. Like, well, the stuff is imperfect. So how do I rely on it?
David Sun 23:16
So all of those things you mentioned, you just got to bake it into your model. For for instance, one of our strategies where you just sell s, p, puts, and it’s about a 90, D, T, E, 15 Delta. Liquidity is pretty reasonable. This is not like selling intraday, where you go in the money and liquidity is gone, yeah, all the gamma and everything, right? We sell high D T because the gamma is lower. It’s more reasonable. We’ve looked at it, the slippage on average, you know, let’s even call it, you know, sell for dollar. You try to buy for $3 you buy for 310, or 320, right? Like 10, 20% relative credit. Just bake that into your assumptions, right? That’s going to increase your required win rate to break even, or for the same win rate, it’s going to lower your PCR. But at the end of the day, it’s all in equation, and you have to bake and bake those in and so like people who talk about back tests, like a lot of times, back tests are reliable because your assumptions about the execution is wrong, right? You’re not right. And so what we can do is we’ve taken our live numbers so we know what the execution of course, like I said, nothing’s guaranteed, but you have enough samples, you can use those to inform your modeling and make it more accurate. Now, with markets being closed, they can gap that’s all baked in, right? There’s been instances, for instance, August 5, right? This one particular strategy, rather than 2x we gotta add 3x or 4x that’s going to raise your average loss. But once again, that just all gets baked in, and the more numbers you have, and just have to you just have to have correct expectations and assumptions and and we’ll talk about the hedging in a second. But that’s where the fundamental. Premise. And a lot of our strategies, we have like, you know, like a dozen strategies now, but the approach is similar in that the strategies that are using NET selling of premium with risk management, we we focus a lot on the statistics and the probabilities and use that to kind of model, the expectancy. I
Jeff Malec 25:22
always tell people overly focused on win rate, like, I can build you the perfect 100% win rate model right now, which is buy, now, sell, when profitable, right by definition, that’ll have 100% win rate you can you survive it? Can you survive if it’s down 98% or something. But by definition, that’s 100% win rate. But what does that do for you? So to your point, right? Like just having a great win rate, what does that really mean? Right? It’s you have to have all the other factors. You have to have the average loss, everything else included in that, in that calculus, without doing calculus, you so one part you said, Hey, we got to control this calculation. We can’t be losing more than whatever. 2x 3x you have a number there with stop losses. The second was adding some hedging, so
David Sun 26:16
with longer data options, right? People kind of don’t like that in the sense that, hey, you know this 90 day option, anything could happen in 90 days, right? So that sometimes people who want to tend towards leaning towards the shorter duration, that might be why. But as I mentioned earlier, the nice thing about a longer iteration is the gamma is inherently lower, so the options move slower or as constant, but you can reasonably hedge them with basically something that’s going to react in a market drawdown, right? Like a Vega hedge, basically. Now they’re sort of the classic, you know, back ratio, right? If I sell one, I can buy two further out of the money and establish this ratio. Now, if you look at the risk curve, there’s sort of this ad expiration is they call it a value of death, where, if the market kind of just lands in that zone, in the spread, you’re still losing, but in risk, yeah, and you’re relying on sort of this, this quick down move with volatility rising to kind of be a backstop, and that ratio will kind of pop up and kind of curb the drawdown. So that’s one way to do it. We we do that as well. But what we’ve really looked at is when we’re moving to kind of shorter, dated structures, it’s very hard to establish a Vega hedge, right? So we have one strategy where we’re selling like a daily right, just Monday. So for Tuesday, Tuesday sell for one just the next expiration, right? Very short dated strangles, we still apply to stop loss by same mechanic. But one thing that really kind of scared us about the shorter data ones, where we didn’t want to lean too much into it was when you’re talking about short date options, you can’t rely on a back ratio or some kind of right. You can buy a cheap out of the money wing and just spread it off. But at distances, you just establish a wide credit spread. It’s not really going to protect you. Like I said, the pin risk the market could fall 5% that that wing is going to do anything. You’re just going to take max loss on your spread. And so one thing that we really realized was this idea of kind of flipping the script on what your hedge structure is. So earlier I mentioned, you can buy further out of the money options. They’re cheap, and you have some reliance and low cost, but you have a, but you also have a reliance on the path dependency, right? That the market has to do a certain thing for your hedge to hedge, right? Yeah, or, for lack of better words, but most
Jeff Malec 28:51
people would think, well, and but same time, if it whatever, 80% of the time, it won’t do that thing. And I’ll, I’ll be fine, right? Yeah? Because brains kind of go like, well, it’ll usually land in this range, and I make money, and then the one in 10 chance it blows all the way through that I hedge it, forgetting that there’s right 16% of the time it might be in between those two things. So,
David Sun 29:11
so one thing, we kind of realize it. So imagine, instead of these, out of them, or further out of the money, kind of Teenies, if you will, you use a closer to the money, like, think of a long at the money straddle, right? If you’re long at the money straddle, you’re actually long the market. You’re long gamma, essentially, but it’s super expensive, right? So you’re going to think, well, if I’m selling an out of the money strangle for some credit, and I try to hedge it with an at the money structure, like, Sure, I’m hedged right, because I’m actually long the guts now, but doesn’t that cost a lot, right? Because you’re paying a lot, right? So it seems counterintuitive, but the interesting thing is, like, if you kind of think about we do. The research long term, if you just buy these at the money structures, they may not cost as much as you realize. And what I mean is this, right? This goes back to the explanation, or the discussion earlier about VRP, right? If out of the money options are overpriced, because, you know, people have this desire for protection, and they kind of bid up protection. I think at the money options may be slightly less fairly priced, meaning the terminal expectancy is not going to be super positive or negative, as in, you can buy these straddles or buy whatever near the money options, and your equity curve on that structure is going to be crazy, right? When the market moves, you make a lot. When the market doesn’t move, you lose a lot. It’s lose a lot. But over time, it actually is kind of wrapped around zero to slightly lower, just depending on which time frame you’re looking at. And so go back to the
Jeff Malec 30:54
way to look into that, that if everyone wants to hedge out of the money, so there’s a slight premium there, right? Skew, they cop put skew. If nobody wants to hedge at the money because it’s too expensive, there could be a little discount there. There’s less of a carry. You’re saying highly, highly volatile, but less of a yes,
David Sun 31:12
there we go. Good description, good word. Okay, so the highly volatile makes it undesirable, but the less of a carry. As you said, Guess what? This is the hedge less of a carry is actually good, right? And so if we use these at the money structures, you you’re you’re structurally protecting your out of the money, you know, strategy. And it’s weird, because your your income, your profit, is from those out of the money, things you’re selling. And yes, it’s very volatile as a package. So like, combining these two, the return stream is pretty lumpy. So like, if you’re only doing this strategy, you know, this kind of combo, like, you’re gonna basically be flat a lot of times, and then finally, when the market rips right, that that hedge kind of shows some profit. So by itself, is not great. But what I want to get at was thinking differently about what it means to hedge and what kind of structures you can use, especially when you have kind of an ensemble of strategies. And the other thing is this concept of the term I coined was a zero EV diversifier, a sleeve of your portfolio that isn’t necessarily meant to drive profits per se, but it’s just meant to diversify the exposure. And so what happened with that is a lot of times in our research and ideation of strategy and trying to generate new ideas, it opened up an avenue, so things we might have ignored or just discounted before were suddenly opened up, right? And like all because of positive derivative it’s so easy to find a put selling strategy and back test, and it looks great, right? It’s actually very hard to find a bearish strategy or something with call selling, because you’re always finding the market trend. But what I realized was like, after some time, I don’t necessarily have to find a strategy that’s quote, unquote bearish, that makes money. If I can find something that’s like, kind of flattish or maybe only loses a little bit. It might be a good thing to add to the book, just because it’s going to be naturally anti correlated to the rest of the book. That’s kind of bullish already, and as long as it’s not losing a lot of money, right? It doesn’t need to add to my bottom line. It just needs to hedge my exposure and reduce my portfolio variance.
Jeff Malec 33:41
Well, right? That’s you’re explaining health insurance, home insurance, right? Like, yeah, I don’t like having to pay this cost, but it’s going to help my overall bottom line over time, and then in Port, overall portfolio construction, right? We deal with this and trend following and manage futures all the time. I don’t this thing’s only flat over these three years. I don’t get it. I don’t want it my portfolio. You’re like, hey, when it, when there’s an Oh, eight, when there’s a 22 and it performs, you’re going to be thankful it’s there, if it can carry positive again, right? If you don’t have to pay for that insurance, then it shows up. That’s, that’s kind of the the whole idea, right? Exactly. So it’s interesting, yeah, that you’re doing that you’re doing that inside of your own strategy, instead of, usually, that’s a portfolio level concept, right? Of adding these pieces.
David Sun 34:31
And one thing that’s really helped is this idea of, it’s kind of like first principles thinking. We call it a Strat thinking, components, right? You may have strategies, and you have all these mechanics. You have a profit take or stop loss, or you got the hedge, and like even a you think about a typical iron butterfly, right? Like you think of it as a package, right? It’s like, long the guts, short the wings, whatever. But sometimes, when you. You strip down the pieces and think about each leg of that strategy, each each transaction in a set of mechanics. You can kind of distill them down and look at them in isolation and find out what’s driving their profits and what is maybe just an unnecessary drag, and then you can really strip things down and figure out and use kind of the best parts. And it’s this type of thinking that lends itself to realizing different pieces have kind of different purposes, and making PNL is not always a priority. As ironic as that sounds,
Jeff Malec 35:43
no, yeah, it makes total sense to me. I just don’t like it when they call them broken butterflies. That’s a sad that’s a sad image in my mind, right? Those poor broken butterflies. So having said that, how many of these models are in your overall strategy, right?
David Sun 36:08
So right now, like, just to give an example, in the zero DTE fund, we have like, six or seven different strategies that are all kind of in the zero DTE space. But just to give an idea of like, how they differentiate. So again, we go back to this concept of selling premium and having a risk management in place to kind of manage that risk reward profile. And so we had one strategy which was a very naive just timed selling. Put in calls, like, literally on the hour or whatever, right? We would sell, amount of premium, sell, amount of premium. Sell, amount of premium. Put a stop loss on each different entry. The reason we did that is like we tranched the entries because, interestingly, yes, we’re selling SPX, they’re all on the same underlying but with zero DTE, it’s such an accelerated timeframe, all those entries, even the morning, the noon and the afternoon entry, won’t be as correlated as you’d imagine, right? You can literally track each different entry as a bucket and run a correlation, and it’s not 100 you know.
Jeff Malec 37:21
And another idea was, and that’s interesting, because even hours apart, right? Yeah, or
David Sun 37:26
minutes apart, literally, yeah. And so this other idea is, because we’re using risk management, as far as you know, again, just a simple stop loss, we are kind of laser focused on the risk per unit of credit, right? So I have this phrase credit as a proxy for risk, where I know people talk about buying power or margin, but if I know that for every dollar I collect, I’m only going to risk x, then the amount of credit I collect is a proxy for the risk I’m willing to take on a given day. And so we’ve established what we call a credit budget. So let’s say we only sell $1,000 a premium per day. That means we technically only put $2,000 at risk, right? Just for an example, yeah, we’ll take that $1,000 and we’ll just split it among the different entries. So you take the $1,000.10 times, right, $100 each, for instance. And so we had this very naive strategy, and I talked about this on my episode with Corey on flirting with models. And back then, I literally emphasized we had no signals. We just sell on schedule. And this was the strategy. This was the original one. But we’ve come a long way since then, because we have we’ve identified for one it’s always out of necessity. We noticed that without any signal the edge from more edge or factor, it was slightly less profitable. It could have been because of the proliferation of zero dt, more volume, more people selling all these institutions covered call funds, everyone selling zero dt. Is that driving down their risk premium? Who knows? Right? There’s speculation, but we noticed that it was like, less profitable. So we try to find other ways to express this. So we realized, like, if we can just kind of increase the win rate slightly, right, when you have this kind of tight expectancy equation, when rate, when one size lost size, even incremental increases to a win rate have meaningful pickups on your expectancy or PC or premium capture rate. So we try to find ways to, hey, let’s not always be neutral or as an always sell a point on call. Is there a way to get an idea of the trend? And I was very opposed to this before. I was kind of like this anti technical analysis, and looking at all these MACD, RSI, those kind of things, and I’ve come to realize, like, again, I think people call it self fulfilling prophecies, but there’s a reason for that. There is behavioral biases. There’s reasons markets trend. So we were, I was more willing to kind of look into. It. And so, yeah, our different strategies are just different ways of Hey. Instead of every on the hour sell puts and calls, we’re gonna say hey, if it’s trending upwards or trending downwards, we’ll lean our exposure right. We’ll only sell puts which is bullish, or only sell calls which which is bearish. And so all of those different strategies are essentially we have different signals informing us of the directionality and where to lean the exposure. Now they’re all trend based, but because, and I’ll give a couple examples of like, how we get this the trend signal, but because they’re different signal sources. Sometimes the signals Align Right. They all fire everything’s bullish, or everything’s bearish, but sometimes you get mixed signals, or we get different timings, and that’s what you want. You don’t want all your Trend signals just to be one big bucket of correlated strategies, again, right? So we have different strategy sleeves that because the signal is different, one may be bearish and one which is bullish, right, which kind of nets out, right, but the timing is different. So it’s essentially trying to just be a little bit smarter about trying to follow the trend. And just an example of one thing to get a trend signal. So because our bread and butter, our expertise is the options, we’re very focused on price. So we’ll look at the price movement. Everything’s related right at the market. So the option or price of the underlying, price of the option, right, we don’t do so much of the price of the underlying, but as I mentioned, everything’s related. If the market’s moving up right, the call prices are going to be going up and expanding right. And the price of puts right, which are below the market, are going to be going down or collapsing, and so both of those, in fact, cause expanding, puts contracting. Both can be an indicator of an uptrend, but not necessarily with the same magnitude or timing. So looking at cause expanding and puts contracting, or vice versa, on a downtrend. It’s put expanding. Yeah, those can both give you separate signals that are slightly different flavor. And so that’s something we look at, the rate of expansion, of the cause and puts, and we look at, you know, if I want to be fancy, I could say we’re observing the volatility servers, but no, we don’t really graph out the volatility server. We just pick options at different parts of the chain and kind of observe their movement.
Jeff Malec 42:27
And we do that separately. So those are two separate things. We do
David Sun 42:30
that separately. I was trying to make a point that yes, simply saying yes, calls go up, puts go down, markets going up. But separately, looking at them can give you signals of the same direction, but different timing and different magnitude, so that it’s interesting that you can observe a lot of things from the chain, and just using those to again each strategy. So we’ll take our kind of credit budget or risk budget, if you will. And let’s say we have six strategies. Every strategy gets 1/6 of the daily credit target or credit, you know, budget that we get. But so
Jeff Malec 43:01
that’s not balanced in any way. Or you can assume each of the strategies has the same risk. It’s using the same type of stop and whatnot. They’re not
David Sun 43:11
equally balanced in terms of risk per se, but we look at over time, the variance, because a strategy like we have one, for example, that’s a little more concentrated, where it takes longer to fire off, but it’ll be a bigger size, right, because it’s a higher conviction. But of course, when you’re wrong, you get hit harder, right? And so we look at the variance of that strategy, and we’ll, I guess it’s kind of like volatility targeting like we will size the ones that have lower Variants A little higher, and the ones with higher variants lower, because we don’t want one to dominate. And I will say one one last thing, we have one sleeve that uses the directional, same thing, the signal, but we buy options, and this is the one sleep that’s a long option, so we have kind of a long gamma component. And this is the reason you need risk management. We’ve seen these options go 1000s of percent right, like in this particular strategy. Look at the equity here. If it’s like, I don’t know, like, a 20% win rate, and you’re just bleeding and bleeding and waiting until you get a huge hit. And there was a day in April and one and last December where the market just sells off 100 handles in like, an hour and a half, and you get massive, like, huge profits. And so you just think, oh, yeah, if you’re selling options and you’re on the other side with no risk management, that that’s where you’re on the other side of So, but, but it’s good when you’re on the right side of that.
Jeff Malec 44:42
And then how do you have, do you know what the total Greeks are across the portfolio at each time? And are you looking at that of like, well, if this strategy fires and we go from positive gamma to negative gamma, and we don’t want to be that
David Sun 44:57
we don’t like, I could look at my. Terminal and just like, Oh, here’s our grease, but we it’s not something we track. But what we know is that, like, you know, stop losses are just kind of a way of delta hedging, right? We’re not continuously delta hedging, but you can imagine, if I sell so many puts and a bunch of them are marking at 200% loss, I’m picking up positive delta, right? If I stop those out, I’ve shifted my delta. So it’s kind of a discrete way of delta hedging, without specifically trying to hedge the Delta percent. I was
Jeff Malec 45:27
going to say that before even your concept of right, it’s interesting, having not come from the professional space, right? Like, your concept of risk per credit, right? That’s basically just assigning a Delta to each one, right? Like, sure, sure. Probably would just be like, Oh, my Delta’s x on this, and that’s my risk, which is tied into, you know, how far out of the money and all that zero DTE, right? So a lot of everything you’re doing in this one fund is zero DTE. That was hugely talked about some time last year. I can’t remember when it’s kind of faded into the background. Nobody thinks it’s going to blow up the whole system anymore, but let’s just talk for a bit of like when you started getting into that, whether it was the retailer in once you were running this professionally, and then what your thoughts are, is it is it dangerous? Is it going to blow up the whole system one day? Is it totally fine? So we’ll start with like, how did you first start getting into zero dt?
David Sun 46:28
Yeah. So with my original fund, I mentioned, we started with kind of the seven DT puts, and we were exploring different parts of the different tenor. So we actually first went up to higher, 45 dt, and then 90 dt. I talked about that. But then we start going backwards, and we went to the one DTE, and ultimately zero dt, which is like, you know, it’s intraday, and it’s like the same again, applying the same concepts, but just at different tenors and timescales. And that was late 2019 like September 2019 we sold our first zero dt, you put, we actually didn’t do calls back then. But then we figured, hey, we can apply the same thing so called. We just kind of did both sides. And it’s funny, because like, COVID happened like, shortly after, and when those are, like, really scary times, we were like, vix was so high, and actually the concept of credit targeting was born then, because we used to just do fixed contract size, but then during March of 2020, the credits were humongous. Yeah, it’s great. It sounds nice. You make a lot of money, but when it gets stopped out, the losses are just so much bigger, right? And we’re like, you know what? Like, this doesn’t make sense. We if we want to kind of lower the variance, why don’t we? And this is actually kind of counter to what most people that do options do, because with options, you’re taught to lean in when volatility is high, because that’s the opportunity go bigger when volatility is high, right? We basically do the opposite, but if my credit per contract is higher and high. IV, I’m actually going to use that as an opportunity to either go further from the money or lower my size, because I’m equalizing the pot of premium I’m collecting per trade. Yeah, so that was kind of born then, but, yeah, it was. It was wild time. So we’ve been doing that since late 2019, and then, of course, like, it was three days a week. And then a big thing in the 2022 finally, like, you know, we got the dailies and all the volume going up. And, you know, even though, you know, quote, unquote, manage money, like, I’ve still kind of associated myself with the with the retail crowd, I’m still engaged in these kind of online communities. And I know a number of people have started, like, off the shelf retail facing automation, right, specifically geared towards zero DT trading. And some of these have pretty large user bases now, and there’s like, two or three of them, and so I don’t know the numbers specifically on like, how much of the flow is, like, driven by retail versus institutional whatever. I just, I just see all these stats that, like, people keep talking about the volume going up, and, of course, like, the best people to talk about would actually be kind of like the Chris siddios or the Jim Crow song. So you’ve talked to them, and a lot of my knowledge is kind of just from them. Like I’m parroting what I’ve heard. But like, no, it kind of makes sense about the whole idea of, like, there was this idea of the tail wagging the dog and the options complex and dealer, you know, market makers, hedging, kind of driving the flow. I think Jim said, like the relationship flipped, like he was saying, like, options are the underlying now, like he literally said, yeah, exactly, that’s backwards. So again, I’m just parroting, you know, whatever I say, I’m just regurgitating what I’ve heard from from the real experts in that aspect, but,
Jeff Malec 49:46
but it mean so in terms of your own portfolio, though, and I think we’ve already covered this, I guess, but just the fact that you’re using zero DTE didn’t increase your risk in your opinion, right? It’s not like your naked. And if the market closes down 20% then your whole fund blows out, right? So I think that’s in people’s mind that the just switching from even 30 dt, and I’m going to start, you know, do you ever listen to a smart list podcast? And they talk about his sister Tracy in Wisconsin. So I’m going to start talking about my friend George, who listens to podcast. So DTE is days to expiration for George. Um, but So switching from 30 DTE to zero DTE didn’t or let’s ask the question, did that increase your risk?
David Sun 50:32
So the reason zero DTE was kind of of interest and how it got literally, we spun it out to its own fun, right? We made a fun out of it was because of the lack of overnight exposure. Now there’s always trade offs. So even going from one DTE, where you take one gap to no gap, we’re essentially day trading, if you will, the options so you lack that gap risk, but what you take on is the gamma risk, right? Because you’re inherently going to be selling much closer than money. That’s just by definition, if you want to collect a reasonable amount of premium. And so there’s that. And, you know, we understand, and I mentioned, you can’t really properly hedge zero DTE, because you just, you know, you can’t do a Vega hedge the market moves. You’re already right there. So there’s two kind of things. One, everything’s spread off. We don’t trade them naked, so they’re spread off. So there’s, like, a fixed amount that you can lose per spread, right? Just per unit of risk. And on top of that, like, we just know, I’ve, I know there’s people who kind of use 80, 90% of their account, right? Because when you’re doing spreads, right, even for that portfolio margin, it’s basically just a spread amount, like you don’t save any margin, it’s just whatever that amount is, times the contracts that your risk right? So we’re not going to ultimately size is the backstop, right? And you’re going to size it to an amount where you can, you’re not going to blow up, right? You might lose a, you know, a couple months of profit, but, yeah, who hasn’t done that before? Right? But again, size is the ultimate backup. So, like, we look at it like, yes, you have stop losses, but that’s your kind of primary line of defense, if you will. But in the case, you can’t rely on that. And I see my I talked with another thing, you know, Chris after Messiah, like he refers to it as EMP risk, right? Like exchange goes down, or you can’t react you. And so at the end of the day, the size is going to be the ultimate definer
Jeff Malec 52:40
of ultimate. That would have been the same thing with 30 dt, right? Like you’re still doing the same calculations.
David Sun 52:46
It’s a little bit different, because with 30 DTE, one, you can be further out of the money, but you can kind of structurally, okay, you know we talked about with the 90 dt and the back ratios? Yes, those hedges depend on a large event and a large shock to hedge. But if that event does happen, you should be, well, hedge, right? So you can conceivably come up with a structure that will react in a black swan event. What I was saying was, with zero DTE,
Jeff Malec 53:19
you really there’s no market down there? Yeah, yeah.
David Sun 53:22
You can’t structure something. There’s no Vega. So that’s the exposure. Is just going to be that gammas. It’s just full on.
Jeff Malec 53:30
So is there a market down there? If I wanted to buy a 30% out of the money zero, DTE, put. So the problem is, is anyone selling them? Maybe
David Sun 53:38
there is. But here’s the thing, let’s say I’m selling a put, that’s 1% out of the money, right? And I buy a put, 30% of the money. The since there’s no time left, a market has to drop 30% for you. So that’s the difference with a what the what the back ratio, right? You might be selling 10% out of the money and buying 20% of the money, but you have 90 days left, so if the market even drops 10% vix goes to 80, you’re going to get a pickup from that ratio in the back. That’s the difference. You have that Vega component. You don’t have that with zero DTE
Jeff Malec 54:11
and what? What’s the average? Like, deltas you’re trading. These are they like, 8090, like, they’re essentially that you said you’re day trading, basically this. They’re still almost day trading the futures, right? Yes,
David Sun 54:22
but we’re still primarily selling. We’re not intentionally selling in the money or trying to get that that full delta one exposure. So like, depending on the time of day, no, we’re probably going to be anywhere from like, 10 Delta, eight delta in the morning to late day, maybe 20 or even 30 Delta. But it’s still, we still try to
Jeff Malec 54:40
do we even in the morning, 1% out is only 10 Delta. It depends
David Sun 54:44
on vix and a lot of things, yeah, so something like that, yeah. It really depends, depends on VIX, depends on which, which exact kind of price per contract you’re trying to collect. Like, right now? What? It’s two o’clock, PM, you. Uh, Eastern Time. Here, I’m just taking a quick look, like a 30 Delta. Put, now, what is this like? A 15 Delta? Put, yeah, this is 5785 it’s just like 20 points out of the money, right? 5800 so it’s, it’s tiny, okay,
Jeff Malec 55:19
yeah, yeah. And then do you do in real time? Do you feel that, like binary Ness, for lack of a better term, right? It’s like, has almost no delta, and then all of a sudden it just flips to having tons, of course, of course, yeah. So, like, um, gamma, but yeah.
David Sun 55:33
So we have considerations for that, like, we know, strategies that trade earlier. You can refer out of the money. You You know, you kind of know if you’re, like, 30 points away, and it’s by the end of day, like you’re relatively safe, but like later in the day, you’re you have to be trading very close. And so we’re aware that, statistically speaking, you’re just going to end up in the money more frequently. And so one thing I mentioned, like, you talk about scaling strategies, like, we won’t lean as heavily into the strategies that trade late day, even though they look very profitable, because, like, theta is enormous. Like, if as long the market doesn’t move, you’re going to make all that money in five minutes, right? But if it does move, you lose a lot real quick. So it looks very attractive. But we know inherently, there’s that in the money risk is the liquidity risk. So we won’t size that sleeve as big as we otherwise might have, if you look solely at the performance, yeah.
Jeff Malec 56:32
And to me, it just, it’s almost like flipping a coin at that point right, like when it’s left, yeah, remember,
David Sun 56:38
if you have a coin that’s, you know, 50% you make a buck 10, 50% you lose $1 like, you want to flip that coin as many times as you can, still good coin, you know, which
Jeff Malec 56:47
leads to me, like, do you think the exchange will wait? What are you training? SPX options? Or,
David Sun 56:52
yeah, which is good? SP just SPX index options.
Jeff Malec 56:55
Got it. Do you think they’ll eventually go to hourly and minutely and read their for profit exchanges. I think they’re just gonna keep cutting it as fine as they can. I don’t know, until people start buying it. Yeah,
David Sun 57:08
I’ve heard the rumors. I honestly, I don’t know how I feel about it, but, you know, we’re doing automated stuff. We’re already trading, you know, and we do like, couple 100 trades a day. So maybe just instead of trading the one that expires at four, expired at 910, 11. You know, just who knows?
Jeff Malec 57:25
Let the computers hash that all out. So where do you go from here? What’s next on the on the horizon? More research, or let these strategies roll for a while. There’s
David Sun 57:39
always more research. Like, we bring a strategy online, like, every three, four months, I guess. So there’s always, there’s like, so much to explore. And last time, when I was with Cora, he asked, for instance, like, will we explore other markets? It’s kind of like the limitation for us is just the data. Like, because we we always very thoroughly, like, test everything and validate everything. And even in SPX, like, we’ve continued to find different ways of exploring the strategies. And a lot of it’s just anecdotal. Like, Hey, today, the market did this. Oh, man, that sucked. I wonder what if we did that instead as a reaction? And of course, like, you know, you want to avoid curve fading and cherry picking and just you never want to develop a strategy that’s fixing a specific problem. But you can get a lot of ideas from the problem that you see. And so you just kind of see what sticks. And like, there’s all these different ideas that we keep trying,
Jeff Malec 58:41
um, but worry that you’re sorry. Do you ever worry your edge is your naivety almost right, not to offend you, sorry, but Right, if that’s your edge and you didn’t know all these other things. And then, as you learn them, you incorporate them in the model, and then you become just like everybody else.
David Sun 58:56
So this goes back to what we were talking about earlier, where the factor, or the edge, like you have to have a fundamental belief that that factor exists, that VRP is a thing, that trend, you know, trends and momentum based on behavioral biases is a thing. Because if you don’t have that, that that is the first principle, everything is just a iteration or build off of that, right? And so I think as long as I have reason to believe those factors exist, and I think they will exist, you know, like, there’s a the phrase from Jim O’Shaughnessy of from infinite loops, he says, like human behavioral bias or something. It’s like the last exploitable edge I probably killed, killed him the quote, but, yeah, the quote, but it and so I think there’s a lot of meaning in that. So, like, as long as humans don’t change and they’re biased, they’re gonna have kind of predictable behaviors which lead to all of those other things and but that’s funny,
Jeff Malec 59:52
because we’re in the midst of AI, which is, like, designed to kill those biases and take them away, right? Uh, or maybe it’s just enhancing, and maybe we’re coding the that’s what bias is in, right, right?
David Sun 1:00:04
People say someone has to code them, right? So, like, maybe just, it’s just an extension of that, yeah. So
Jeff Malec 1:00:09
they’ve learned from the entire human history, which is just codified the biases, right? And do you use any AI in the research or the trading or anything?
David Sun 1:00:19
At the moment, though, like, we have a couple guys who have some AI background, and we’ve looked at, trying to look at different features and see if there’s patterns, but I don’t know, like, we haven’t found anything, nothing actionable yet. Yeah, that we’re opposed to it, and
Jeff Malec 1:00:32
it’s weird, right? But get spurious correlations, like, oh, always sell at 9:45am on Tuesdays. Yeah? Okay. Why? Why? Yeah, just because the AI said, so I want to know the reason. Exactly, great. What else got? Anything else you want
David Sun 1:00:50
to leave us with? I think, I think the idea of kind of retail, I know, like there was, especially a couple years ago when I had that appearance with Corey like this, this idea, it’s hard to disentangle, uh, read the retail space in terms of the people who are just bull market genius. I see all these accounts of, like, trading the wheel, or, like, you know, selling puts. And I think that’s kind of my indicator of, like, we’re at the top right, but, but there’s, but there’s that part of the space. But there really is, like, they
Jeff Malec 1:01:27
started it, like, right after COVID, I guess it’s easy, yeah,
David Sun 1:01:30
something like that, right? And then there is, um, but there is another side of, kind of the retail aspect, right? Retail, maybe they’re not managing funds or part of large shops. But, like, there’s smart people out there, and it’s something where, like, don’t discount the little guy. You know,
Jeff Malec 1:01:49
it’s almost a large, lot of large numbers, right? Like, if all them are putting their minds to work, there’s going to be some good stuff that comes out of there, yeah.
David Sun 1:01:58
And part of that’s because there’s been this proliferation of data that’s available, not just to the big shop, but you can just go to see both shop and buy data. And like, you know, if you can code and you can process data, it’s all about just big data, right? And and there’s off the shelf sophisticated back testing software, automation software, so, yeah, it’s just a it’s been interesting to be a part of that side of it and watch that space grow and again, like that. That’s kind of the side that I I still kind of associate myself with, even though I’ve quote, unquote joined the Dark Side, if you will. Like, kind of managing money. Don’t
Jeff Malec 1:02:35
do it right until you have, like, a compliance team and biometric scans to enter your office and stuff you haven’t gone full dark side. So yeah, you’ll be good. All right. Well, thanks so much. David, I think we’ll leave it there. Tell everyone where they can find you, where they listen to the podcast.
David Sun 1:02:56
Yeah. So my podcast is called the trade busters. You can ship it to find on most of the major platforms, Apple, Spotify, Google, podcasts, and it’s a, it’s kind of a collective mix. It’s retail oriented, options focused, but it’s it has a mix of strategies, specific education on that. I’ve had a lot of guests in this space. I’ve really tried to broaden the horizon of like, what it means to be retail investors. I’ve had people like Corey, Andrew, beer, Jerry Parker and to kind of talk about different products. And now you can, you can construct capital efficient, institutional quality, type of portfolios with the products available and portfolio margin, and just like, it’s so accessible now. So that’s kind of been my big drive. And then kind of, why do what I do? And I have a if you go to the trade busters.com that’s kind of my quote, unquote trading page. If you want, it’s actually just a Google Sheets deposit. There’s like this running joke that I’ve never made into a real website, but there’s links to my podcast episodes, other podcasts, probably a number of your episodes that I really like. It’s sort of just like the repository of like stuff I like to share. It’s kind of like Chris is the moon tower, but kind of my version, yeah,
Jeff Malec 1:04:13
I love it. I gotta get Chris on here eventually, maybe in the new year. Yeah, I’m sure. Well, yeah, check that out. And then, so you started that, when the podcast,
David Sun 1:04:25
wow, I started that, like summer of 22 maybe Okay, and it’s like 130 episodes now. It’s crazy. I can’t even believe how much there is, but kind of goes right.
Jeff Malec 1:04:37
I you like doing it. You like the talking, the right, the scheduling, all that junk is is a pain in the butt, but the Talking is the enjoyable part, at least to me. Well, it’s
David Sun 1:04:47
because I don’t like to write like I actually linked. There’s a, like, a handful of essays I wrote that were like, pre the podcast, and just whenever I had something, I wanted to share certain ideas. But I found, like. Uh, it will take me a month to write like it’s just that that’s not my my jump
Jeff Malec 1:05:07
on the AI that’s tailor made for you there, right? Just open a memo recorder and talk for go on a walk, talk for an hour and then have aI write a well, a summary on
David Sun 1:05:16
well that top and record and talk. That’s basically how the podcast was born exactly. I don’t like to write, so I’ll just talk. And so I can just sit there and talk for an hour easily, and then just know, so it’s just kind of like miscellaneous thoughts, and that’s how that started. Love
Jeff Malec 1:05:30
it, all right. Well, check out David, check out the podcast. Check out. You got a website for the GP,
David Sun 1:05:39
not at the moment. Feel free someone’s interested. Just Just reach out. Just reach out. Um, you can find my contact info, the the trade the the Google Sheets page, my, my trade busters emails there. So you know, feel free to reach out. But, uh, let’s leave it at that.
Jeff Malec 1:05:51
Leave it at that. All right. David, thanks so much.
David Sun 1:05:56
All right. Thanks for having me. It was a pleasure. Yep. Love it.
Jeff Malec 1:06:03
Okay, that’s it for the pod. Thanks to David, thanks to RCM. Thanks Jeff Burger for producing and RCM for sponsoring. We’ll see you next week with Jason buck and Zed Francis to close out the year. Usually we take off thanksgiving to after January, so last part of the year, next week. Tune in, peace.
This transcript was compiled automatically via Otter.AI and as such may include typos and errors the artificial intelligence did not pick up correctly.
