Dorian trader


About us

Who we are

The Dorian Way is a trading philosophy that was adopted from the Volatility Hedge Fund called The Dorian Fund. The philosophy is centered around trading to make monthly income that can act as a supplement or primary source or income and/or to enhance retirement investing

The Dorian Way’s principal investment strategy that was adopted from The Dorian Fund a Volatility Hedge Fund is to utilize a top-down macroeconomic approach o determine how to deploy capital across stock indices, commodities currencies, and future markets. The future markets could consist of commodities currencies and/or indices. Once opportunities are ascertained the Dorian Way’s trading method to take advantage of the possibilities and predominantly executed through advance option strategies.

The advanced option strategies are based on probabilities comparable to how insurance companies write car insurance policies. when writing car insurance policies ,insurance companies consider probabilities of policy contracts expiring worthless based on things such as age ,diving record, previous coverage, and geography. Insurance companies make money if a policy can expire without a claim being made that is more than the original premium received. likewise , when writing option contracts, the Dorian Way considers probabilities of expiring worthless based on things such as option-delta, implied volatility ,standard deviations, and duration of the option. Money is made if contacts can expire without a claim or bought back for less than the premium received. The Dorian Way is about executing trading ideas through option selling because options are believed to provide the best opportunity to make money irrespective of market direction. To minimize risk the Dorian Way consist of always hedging on an instrument and/or portfolio level. The breakdown of the Dorian Way process is as follows

  We use proprietary quantitative and qualitative trade evaluators to determine which global markets      to invest in. We primarily invest in global U.S. dollar denominated products that consist of equity, commodities, currencies, brands, and volatility instruments. All products qualify as 1256 contacts

  Once a product is decided on through our research we mostly determine how best to take a long       and/or short position using advanced option selling strategies. Most positions are based on being around two standard deviations from the current underlying trading price, which is determined by its present implied volatility. See the image below based on standard deviation.
  An option position is initiated with 30 to 60-days to expiration (primarily)
  Depending on the trading situation we close out positions when we can buy back the option at 25%, 50%, and 75% less than the premium we received for selling the option. We also hold some of our positions(less than 1%) to expiration for full premium.
  We use futures contracts and we buy options to hedge positions and/or the portfolio. In addition, we spread our capital across instruments placing lots of small trades and we always keep a percentage of the portfolio in cash at all times.
The bell curve below shows how we primarily trade around two deviations from the current trading price. For example, if the index is trading at zero on the bell curve then we would normally sell put-spreads to go long the market at -2 on the bell curve and/or sell call-spreads to short the market at +2 on the bell curve.

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