Friday, April 18, 2014
Saturday, April 12, 2014
My Trades for Week 4/11/14
Trades placed this week for credit.
Total Credit | $4465 | I generally give back about 65% of this amount when taking off trades. I am not pocketing this full amout. | |||||
Legs | Date | Buy Sell | Price | Amount Recieved | Credit Received | Spread | |
+APOL 17MAY14 25.0 P | 2014-04-09, 13:27:19 | -3 | 0.29 | $87.00 | P | $87.00 | P |
+NDX 25APR14 3800.0 C | 2014-04-11, 12:01:03 | -1 | 0.43 | $43.00 | C | $43.00 | C |
+NDX 09MAY14 3800.0 C | 2014-04-09, 12:33:57 | -4 | 3.5 | $1,400.00 | C | $440.00 | Bear Call Spread |
+NDX 09MAY14 3825.0 C | 2014-04-09, 12:33:57 | 4 | 2.4 | -$960.00 | C | $0.00 | Bear Call Spread Leg2 |
+NDX 23MAY14 3150.0 P | 2014-04-11, 09:40:43 | 1 | 18.47 | -$1,847.00 | P | $805.00 | Bull Put Spread |
+NDX 23MAY14 3225.0 P | 2014-04-11, 09:40:43 | -1 | 26.52 | $2,652.00 | P | $0.00 | Bull Put Spread Leg2 |
+NDX 21JUN14 3775.0 C | 2014-04-08, 11:56:29 | -3 | 15.75 | $4,725.00 | C | $1,020.00 | Bear Call Spread |
+NDX 21JUN14 3800.0 C | 2014-04-08, 11:56:29 | 3 | 12.35 | -$3,705.00 | C | $0.00 | Bear Call Spread Leg2 |
+RUT 23MAY14 1180.0 C | 2014-04-09, 15:59:38 | -1 | 18.22 | $1,822.00 | C | $760.00 | Bear Call Spread |
+RUT 23MAY14 1200.0 C | 2014-04-09, 15:59:38 | 1 | 10.62 | -$1,062.00 | C | $0.00 | Bear Call Spread Leg2 |
+RUT 23MAY14 1010.0 P | 2014-04-10, 12:04:20 | 3 | 5.14 | -$1,542.00 | P | $240.00 | Bull Put Spread |
+RUT 23MAY14 1020.0 P | 2014-04-10, 12:04:20 | -3 | 5.94 | $1,782.00 | P | $0.00 | Bull Put Spread Leg2 |
+RUT 30MAY14 1030.0 P | 2014-04-10, 12:23:17 | 1 | 8.77 | -$877.00 | P | $635.00 | Bull Put Spread |
+RUT 30MAY14 1070.0 P | 2014-04-10, 12:23:17 | -1 | 15.12 | $1,512.00 | P | $0.00 | Bull Put Spread Leg2 |
+SPX 19APR14 1950.0 C | 2014-04-07, 09:30:28 | 1 | 0.15 | -$15.00 | C | -$5.00 | Bear Call Spread |
+SPX 19APR14 1960.0 C | 2014-04-07, 09:30:28 | -1 | 0.1 | $10.00 | C | $0.00 | Bear Call Spread Leg2 |
+SPX 17MAY14 1895.0 C | 2014-04-09, 14:30:17 | -1 | 13.35 | $1,335.00 | C | $365.00 | Bear Call Spread |
+SPX 17MAY14 1905.0 C | 2014-04-09, 14:30:17 | 1 | 9.7 | -$970.00 | C | $0.00 | Bear Call Spread Leg2 |
+SPX 17MAY14 1925.0 C | 2014-04-09, 14:53:36 | -1 | 4.58 | $458.00 | C | $290.00 | Bear Call Spread |
+SPX 17MAY14 1950.0 C | 2014-04-09, 14:53:36 | 1 | 1.68 | -$168.00 | C | $0.00 | Bear Call Spread Leg2 |
+SPX 23MAY14 1900.0 C | 2014-04-11, 15:10:12 | -1 | 4.5 | $450.00 | C | $450.00 | C |
+SPX 23MAY14 1905.0 C | 2014-04-11, 15:20:20 | -2 | 3.8 | $760.00 | C | $760.00 | C |
+SPX 23MAY14 1945.0 C | 2014-04-10, 13:17:51 | 5 | 1.6 | -$800.00 | C | -$150.00 | Bear Call Spread |
+SPX 23MAY14 1950.0 C | 2014-04-10, 13:17:51 | -5 | 1.3 | $650.00 | C | $0.00 | Bear Call Spread Leg2 |
+SPX 30MAY14 1705.0 P | 2014-04-08, 10:28:45 | 3 | 10.1 | -$3,030.00 | P | $315.00 | Bull Put Spread |
+SPX 30MAY14 1715.0 P | 2014-04-08, 10:28:45 | -3 | 11.15 | $3,345.00 | P | $0.00 | Bull Put Spread Leg2 |
+SPX 06JUN14 1750.0 P | 2014-04-10, 14:30:18 | 1 | 15.9 | -$1,590.00 | P | -$1,590.00 | P |
Friday, April 11, 2014
Going long soon in $NDX
I'm loading up on $NDX Bull Put Credit Spreads The BB and Fractal lines are showing a breakout and a reversal soon.
Thursday, April 10, 2014
My Strategy Summary
Trade SPX, RUT, NDX
Strategy of Selling Credit Options Spreads far out of the money using some technical analysis.
Summary
- A strategy to profit on Theta (time decay) and volatility
- Rules may be changed depending on market trend and volatility
- Sell calls or puts or Spreads independently
- Sell more puts depending on market trends (I use a weekly chart to determine overall market trend)
- In 2013, maxed out on the put side to sell twice as many puts as calls
- Sell call spreads with greater risks as market does not crash up
- The variable ratio of put to call contract sizes allows the strategy to adapt to market trend
- In 2013, I should have stayed light on call side and to sell calls with shorter period of time (in late Nov I was heavy on Call side and suffered some pain.
Trading Vehicles
- Traded SPX RUT and NDX options mainly, sometimes I sell puts in stocks
- I trade QQQ, IWM, and SPY and do not worry about taxes.
- I like trading the SPX best - No problems with SPX option liquidity
- I go to the RUT and NDX when I need other positions to put on. Long (or Short) deltas are are essentially the same in all three when I try to “balance the portfolio”.
- I sell puts in stocks
Sell far out-of-the-money, high probability options depending on market volatility
- In 2011 & 2012 when volatility was higher (VIX >= 15), sold puts with 2 SD (5% ITM Probability)
- In 2013 when volatility was low (VIX around 11 to 13), sold puts with 1 SD (15% ITM Probability) to 1.5 SD (8% ITM Probability)
- Sell calls with 10% ITM probability
Option Cycle Selection
- 30 days to expiration for calls in general for 2013
- 56 days to expiration for calls if price can be projected and good premium can be obtained from far above the projected price
- Use trend analysis including 2 SD Bollinger bands, resistance, and FIB retracements and Fractals
- 56 days to expiration for puts spreads
Trade Entries Triggers
- Sell calls spreads for credit when market rises
- Sell puts spreads for credit when market falls
- Trades are entered in multiple days around predetermined option expiration days
- On a Bollinger Band Touch or a Fractal Breakout (reversal soon) when the market is still rising - I sell call spreads and try to “load up” allowing my portfolio to go un-balanced
- On a Bollinger Band Touch or a Fractal Breakout (reversal soon) when the market is still falling - I sell Put spreads and try to “load up” allowing my portfolio to go un-balanced
- Because I am using Defined Risk Trades - I do not worry about my portfolio going un-balanced
Trade Exits
- Actively take profits and risks off the table
- For options (puts) starting around 56 DTE
- Close positions if profits reach 50% within 1st 16 days
- Leave positions on after the 40 DTE neighborhood if they are not closed yet so that they can expire worthless
- For options (calls) starting around 30 days
- Close positions if profits reach 20% to 30% or even better 50% in a few days
- If price continues to rise with 1 week left for call options, then take the calls away and move them to next week while keeping puts on
Trade Adjustments
- Close out losing trades that have a DTE of less than 14
- Try to make up the loss either through selling more put or call contracts
Money and Risk Management
- Use Defined Risk Trades
- Do not over-manage positions
Psychology and Mindset
- Control the emotions of both fear and greed
- Trust statistics and high probability (Use 2 SD for 95% odds of success)
- Use structured method and manage positions well
- Require a high level of confidence and repeatable successes for a long time.
Team Members
- None
Made several Credit spreads on 4/8/14 in $SPX $NDX $RUT
Total Credit | $1994 | I generally give back about 65% of this amount when taking off trades. I am not pocketing this full amout. | |||||
Legs | Date | Buy Sell | Price | Amount Recieved | Credit Received | Spread | |
+SPY 17MAY14 193.0 C | 2014-04-09, 16:00:05 | -2 | 0.48 | $96.00 | C | $52.00 | Bear Call Spread |
+SPY 17MAY14 195.0 C | 2014-04-09, 16:00:05 | 2 | 0.22 | -$44.00 | C | $0.00 | Bear Call Spread Leg2 |
+APOL 17MAY14 25.0 P | 2014-04-09, 13:27:19 | -3 | 0.29 | $87.00 | P | $87.00 | P |
+NDX 09MAY14 3800.0 C | 2014-04-09, 12:33:57 | -4 | 3.5 | $1,400.00 | C | $440.00 | Bear Call Spread |
+NDX 09MAY14 3825.0 C | 2014-04-09, 12:33:57 | 4 | 2.4 | -$960.00 | C | $0.00 | Bear Call Spread Leg2 |
+RUT 23MAY14 1180.0 C | 2014-04-09, 15:59:38 | -1 | 18.22 | $1,822.00 | C | $760.00 | Bear Call Spread |
+RUT 23MAY14 1200.0 C | 2014-04-09, 15:59:38 | 1 | 10.62 | -$1,062.00 | C | $0.00 | Bear Call Spread Leg2 |
+SPX 17MAY14 1895.0 C | 2014-04-09, 14:30:17 | -1 | 13.35 | $1,335.00 | C | $365.00 | Bear Call Spread |
+SPX 17MAY14 1905.0 C | 2014-04-09, 14:30:17 | 1 | 9.7 | -$970.00 | C | $0.00 | Bear Call Spread Leg2 |
+SPX 17MAY14 1925.0 C | 2014-04-09, 14:53:36 | -1 | 4.58 | $458.00 | $290.00 | Bear Call Spread | |
+SPX 17MAY14 1950.0 C | 2014-04-09, 14:53:36 | 1 | 1.68 | -$168.00 | $0.00 | Bear Call Spread Leg2 |
Tuesday, April 1, 2014
March results for Selling Spreads in a Small IRA Account in $NDX, $SPX, and $RUT
Below are my results using $NDX, $SPX, and $RUT along with a few puts sold. With this account of approximately $45000 I made a Monthly P and L of 4.5% or 179% APR. My method is a Modified Karen technique where I am "not" trying to have a balanced portfolio but rather skewed in the direction of the overall "Weekly Trend", I sell spreads, and I load up on in the opposite direction when the Bollinger Bands are Touched (or Fractal Breakout which is the same as they both could be interpreted as a reversal soon using a daily chart). When I do balance my portfolio it is for shorter DTE spreads. Today - my portfolio is relatively balanced.
Full Spreadsheet click here.
My current OPen trades are:
Full Spreadsheet click here.
My current OPen trades are:
My Trades | |||
Act | Legs | Spreads | Win Lose |
+ | MGM 17MAY14 23.0 P | Winning | |
- | NAV 25APR14 31.0 P | Winning | |
+ | NDX 25APR14 3325.0 P | Bull Put | |
- | NDX 25APR14 3350.0 P | Bull Put | Winning |
- | NDX 25APR14 3825.0 C | Bear Call | |
+ | NDX 25APR14 3850.0 C | Bear Call | Winning |
+ | NDX 02MAY14 3325.0 P | Bull Put | |
- | NDX 02MAY14 3350.0 P | Bull Put | Winning |
+ | NDX 17MAY14 3250.0 P | Bull Put | |
- | NDX 17MAY14 3275.0 P | Bull Put | Winning |
+ | RUT 25APR14 1090.0 P | Bull Put | |
- | RUT 25APR14 1100.0 P | Bull Put | Winning |
+ | RUT 02MAY14 1120.0 P | Bull Put | |
- | RUT 02MAY14 1130.0 P | Bull Put | Winning |
+ | RUT 17MAY14 1070.0 P | Bull Put | |
- | RUT 17MAY14 1080.0 P | Bull Put | Winning |
- | SPX 11APR14 1890.0 C | Bear Call | |
+ | SPX 11APR14 1900.0 C | Bear Call | Winning |
+ | SPX 02MAY14 1770.0 P | Bull Put | |
- | SPX 02MAY14 1780.0 P | Bull Put | Winning |
- | SPX 02MAY14 1920.0 C | Bear Call | |
- | SPX 09MAY14 1745.0 P | Bull Put | |
+ | SPX 09MAY14 1755.0 P | Bull Put | Winning |
+ | SPX 09MAY14 1925.0 C | Bear Call | |
- | SPX 09MAY14 1935.0 C | Bear Call | Winning |
- | SPX 17MAY14 1960.0 C | ||
+ | SPX 23MAY14 1940.0 C | ||
+ | SPX 23MAY14 1945.0 C | Bear Call | Winning |
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