If You're LOSING $$$ in 0DTE Options, Do This ASAP | Zero Days to Expiration
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- Опубликовано: 29 янв 2024
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We trade 0DTE long and only on the SPX. Advantages: 1) The high gamma works for us instead of against us 2) Always limited and precisely defined risk (= purchase price of the option) 3) No exercise risk (cash settlement with SPX) 4) Unbeatably high liquidity with SPX
Excellent study! Thank you for shedding some light on the losing side of the trade. The idea of only managing winners and ignoring losers just doesn't sit right with me. This gives some useful insight! Much appreciated!
Thanks Tom and Bat, this was a great study on managing losses.
I am just trying to pull in 2 bits here. Tasty had a study on adjusting winners at 25% wins and recentering through the day. Then there is this study on losses which is basically close IC/straddles at noontime
How about a study that combined both - centering the wins when it hits 25% and exiting trading by lunchtime. - perhaps define lunchtime as well.
Just on SPX- nothing else... for now.
Iron Fly with 30-40point wings, shorting front month 0, (maybe 1,3,7 if time allows) DTE? everything in the front month.
Managing wins -ie recentering at 25% till lunchtime then close the game at lunchtime whatever the outcomes. If there was a loss no further trades put in. Data is considered significant (ie no bias) when there is about >100 points of data. So that in itself is quite deep and wide. Cheers
Commission s Commission s Commission s....lol.hahaha
@@user-mf2fd6dq8xyou can use these ideas on any good platform....
It's not a straddle, it's a staddle. 😁😂
Thanks guys- in all seriousness, I appreciate your content, studies and everything you do.
Thanks for the video. Good job outta you. Keep uo the good work. Sounds like a double diagnonal.
Should a trader keep the back month long positions open and continuously sell 0 DTE straddles?
Can someone plz explain what does he mean by back month iron fly and front month iron fly?
Great video, Tom and Bat. I follow ODTE's closely so this is valuable information. Has any of Tasty's research explored other debit strategies when trade P/Ls are not profitable other than closing the trade? For example in a 16 Delta Short Strangle has hedging with a long closer to ITM position to reduce negative P/L? Thanks to you both and the Tasty Team.
I've done a few on spx. I'd put them on with about 15% ITM%. I'd take them off if it gets to 30% ITM%. Seems to work okay. I'll study your research thought. 0dte still scare me.
Does $ Ironfly Avg PL include weighted CVaR (loss) or not. If CVAR (loss) is not weighted average included and if we include it, the total P&L will be negtive? For example closing at noon.
Total P&L will be: $100*65%-$1220*35%=-362$/trade. correct me if I am wrong.
So, sell 0DTE ATM straddles and buy monthly long strangle to define risk compared to a normal 0DTE Ironfly. Is this what they were discussing about?
Tasty, i see a lot of comments asking how to set this trade up. That is my question also. Please revisit this trade and do a setup on the platform. Could you please also define what you mean by front and back month. Ty
To be sure the 30 iron fly is on spy not spx
Tom and Bat please! please! set this trade up for us in your next 0dte segment because when I sell the 0dte straddle and try to buy the backmonth 30-day strangle@the expected move in SPX, it results in a massive buying power reduction of over $12,000 doesn't make any sense to me at all. I may be doing something wrong, please demonstrate how to set this trade up on the tasttrade platform the way you would set it up for yourself, thanks.
no that's the correct BP reduction... 12k
you could try /mes or XSP if that's too much buying power
Please, PLEASE, could the next 0DTE video study be managing winners AND losers at different ratios (example 1 to 1 managing losers and winners at 25%, 50% and 100% initial credit but also managing 1 to 2 risk reward, like managing losers at 50% initial credit but winners at 25% so you give a bit extra room to be wrong). We as viewers appreciate it as I'm doing myself this type of management (I'm closing/managing trades when collecting 25% of initial credit or when losing 50%)
Generally the more complicated you make it the worse things perform with options.
When they said straddle. So they sel 0dte straddle and buy 1dte as hedge. I don’t understand the trade
They short straddle in 0DTE and buy strangle in 30DTE (monthlies) options at their expected move strikes.
@@caiobortoli how why is the strangle? I don’t get the reason for the trade. 1dte long strangle on spx risking $1500 to make $2800, 30dte strangle risking $11k to make $3500.
@Eqnotalent strangle has slower theta than 0 DTE short straddle but still has good delta to hedge bigger moves. Hower not perfectly. I backtested this also with real data. Point is that long strangle moneywise looses as well quickly a lot, so profits might be not so good as in theorie. Thank
@@MartinHlouschekOptionstraderdid you backteset using a 30dte straddle instead of a strangle? I've found it doesn't lose theta that much faster than the strangle
@@theeman2424 Hi, not yet, will consider it. We took the year 2022 and tested every minute after open till close, also traded in 2023 lots of real trades. Short Straddle ATM but also other. However short straddle ATM has certain edge. Loggin in immediately after market open, the short straddle "survives" without loss a spx movement of 10-12 points. 100-150 Dollar Profit, ....after 45 min after open, the short straddle ATM has no edge...then again the last 2 hours befor close. To avoid tail risk, big moves, we tried to hedge the wings with all kind of techniques: backspread 0DTE and 1 DTE OTM for nearly 0 dollar, long straddles 1-14 DTE, long strangles 1 Dev. 2 Dev.. We found out that costs of hedge (commission, spread, theta) takes away to much profit of short straddle. So our best approach is quite simple. If the Short Straddle ATM 0DTE has a price above 20, we trade, profit target 100-120 Dollar, and use a simple stop at 200 dollar, after some time wie manage stop to 0 dollar risk and let the market decide our exit. With 200 dollar stop from the beginning it equeals a move of about 20 point immediatel after open, what is rare. after 45 minutes we take profit. 2 hours beforce close we open again, using profit or part as stop and manage it. comparing the stop with costs of hedge it is probably cheaper..🙂 try to open in demo for some time the ATM after open, and observe. Once the straddle is lower than 20 points it showed that we get a bigger move in the spx that day. We are still working on optimazation.....
I took that as "trade double diagonals / straddle strangle swap" with backend being a month out to keep it defined risk.
Until it doesn't work of course.
Why is the backend not 0dte too?
little delta@@dazisgud
Engaging in active trading versus long-term investing requires unique strategies for maximizing returns. Active trading involves frequent buying and selling of securities, aiming to capitalize on short term market fluctuations. On the other hand, long-term investing focuses on holding assets over an extended period, leveraging the power of compounding.
Absolutely, the key to successful trading lies in a well defined strategy and execution. Whether you’re a day trader or a swing trader, having a plan that includes risk management and exit criteria is crucial. It isn’t just about making profits but also involves minimizing losses and staying resilient amidst market volatility.
You’re correct. Although, It is advisable to seek guidance from a professional or trusted advisor in order to navigate this recession and achieve potential high yields.
I have been in touch with a Financial advisor. With a startup of $ 100 k, my advisor chooses the entry command of my portfolio which has grown to approximately $ 450 k in some weeks.
I’m intrigued by your progress. Could you share some insights into your trading strategy or perhaps recommend any specific resources or mentors that have led to your success.
I consult with:-
But you all are only SELLING options right? Or is this actually buying side?
If you're losing, stop doing them. Do something else! Ta da. I fixed your problem.
I have a consistent strategy for zero DTE’s: stay the hell away