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The issue with Iron Condors is the cost of transactions given four legs and eventual unwinding. The put spreads cant be managed so one and done.. Another strategy that like which can be seen as a means of generating decent one year returns with a longer term perspective is selling straddles...

Use the software to monitor temperatures and determine source of excessive heat. The next step is to vacuum all dust from board and fan if generally too hot. Then put new paste between all chips and fan to make sure cooling is effective if source of heat. If this is a new rig and not running too...

We had a great saying on the CBOT floor when trading options in the pit... After one year, you can confidently say you know how to succeed in day trading options. After two years, you can confidently say you have no clue how to trade options.

Look at the calculation and the solution itself - (POT) Probability of Touch for an In-The-Money option is 100%. It's not asking how many times can you expect it to Touch before expiry. This becomes relevant for an OTM option in terms of understanding the risk. Its just one measure of 100 to...

Basically, any option with a delta greater than .5 can expect to be tested at least once. A one standard deviation option with a delta around .25 has a 50% chance of a touch. Plan for it.

@Libranalysis , I just put my money where my mouth is.... it took forever to put the trade on as the options are not liquid and the stock just trended up after the opening. As I said on Friday, the vols tell of a binary event which happened this morning. The vols are still elevated and the...

The simple answer is to buy three months out of the money put vertical spreads after a large vol spike. You need to give yourself at least two months for the market to calm down. In the past, when I tried to short the product, there would never be shares available to sell and margins have been...

I don't think the right question is how many years experience is needed to be a profitable day trader. The more important question is what skill sets are needed to be successful. Most people will agree that the markets are random and cannot be predicted. Most people agree that the casino has...

When you dollar average down, the subsequent move back can be a significant profit maker. Obviously, your position is no longer small. The portfolio risk is higher. But the terminal loss at zero is significantly less from the original trade. Then there is the assumption that the underlying...

My suggestion is to drop your trade size by 90% and don't use stop loss orders. Then you can dollar average when the market goes against you and wait till your right. When you dollar average at a big discount, use your first entry as your new profit target and add 2-4x. Repeat.

Investors don't understand the real cost of execution and the major drag when having to pay someone else to do the trading for you. This even ignores the tax implications of short-term gains tax versus long-term positions which have capital gains but have not been sold thus no tax paid yet...

The mathematical formula for the probability of a touch is: e-qt * N(d1) x 2 So the probability of a touch is approximately twice the delta of the option. The Delta of the option is the primary driver of an options behavior and provides a predictable model of what the option will do relative...

Libranalysis, I like this strategy and have made money using it for a long time if you stay small. Assumption: you have a long term view of one year or more of the stock going higher. The next step is to watch the extrinsic value of the strangle. When the extrinsic approaches zero on one...

People underestimate the cost of slippage when trading. The market makers want to earn a living by pricing products so that the bid/ask spread can put food on the table. This spread is much larger when you have a bigger order to fill. A deep in the money put has a delta close to 1 or equivalent...

d'Orian, To summarize what has been said already, you are trading in fragmented markets and so prices trade at different levels across exchanges. IB sells your order flow to a high frequency firm that can bucket your order or let it flow on the exchange. They may like your trade and do the same...

Puts trade rich out of the money so put ratio spreads have a greater chance of success then call ratio spreads if you don't have a directional view. He could have sold put ratio spreads if he was slightly bearish as max profit would be marginally lower market not higher. If he was a big bear, he...

I traded in the pit and every possible role around the floor. Traders would be out drinking until sunrise and between the smell of sweat, alcohol and gas, it was difficult to breathe next to someone's armpit in your face. You're only reprieve was when someone was spitting all over you trying...

NLNK - Stock at 15 and 15 Straddle at 10 dollars for Jan 2018. 335 days so about 70% return on capital. You own more stock at 5 dollars if drifts down. Your cap is 25 dollars. BAC - stock at 25 and 25 Straddle at $5 for Jan 18. 20 % return. Own more stock at 20 or cap at 30. It's boring and...