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Hi cdowis, Thanks for your post. Your technique appears to be an excellent approach. You're essentially taking the same directional posture as I am, oriented towards neutral to higher, only with calls, rather than puts. As I mentioned in my original post, I used puts because the exit has less...

Hi traderlux, Again, thanks for your interest in the progress of my GLD trades. You can also get a good understanding of my trading philosophy and results by visiting wastingassets.net. Good luck and good trading, Josh

Hi traderlux, Thanks for the kudos about my posts and blog. BTW, the GLD diagonal has moved up 15% since 12/17/10 to 0.92, as of yesterday's close. Not too shabby for less than a week's time frame. Re your questions, I don't trade either of those contracts for a couple of reasons. First...

Hi Folks, Diagonal spreads have long been known as an excellent risk/reward means of net selling options time value (TV). For those unfamiliar with this technique it consists of buying an option in an out month and selling the same type of option, but at a different strike in the front month...

Hi EliteThink, Thanks for the posting. I'm not doing any filtering. Several other posters have mentioned a desire to find ways to enhance the strategy, but I'm quite content to chug along just as I have described for the foreseeable future. Employing a KISS strategy, as it were. The natural...

Hi folks, For those who have been following the progress of the long term GLD strategy I've been using, this is an update. I've been in a Jan 1011 bull put spread at the 135/140 strikes. Since there is only one month remaining for gaining success in this position, I rolled it yesterday into...

Hi Folks, Well, the bullish put vertical spread strategy clicked again in the December contracts. That marked the 75th winning month out of 120 cycles encompassing the last decade, a success percentage of 62.5. We entered a new spread at the 1235/1240 strikes in the January contracts, buying...

Gentlemen, it’s gratifying to see so many folks contributing to this discussion about the strategy I posted. I’ve waited until the November expiry to respond in the interest of consolidating them into one reply. Unfortunately, many of the postings have concentrated on the validity of my...

This is an alert that it's getting close to another roll up in the GLD strategy. I'm now in a bull put spread in the Jan 2011 135/140 strikes after rolling up from 130/135 for a nice credit. When (and, of course, if) GLD hits 140, I'll roll into the Jan 2012 140/145 strikes. That ought to...

Well SpindrO, I think it is an anomaly. As I have said ad nauseum, if anyone can show me another decade when the market was down 15% and the monthly cycles were up over 60% of the time, I'll profusely apologize. As for the cycle the strategy doesn't work, you only lose 2.50/3.00, so BFD.

Well put Wayne, particularly since the solution to the country's massive debt problem appears to be debasement of the currency, paying back dollars with quarters, as it were. That means growth in share prices is inevitable in nominal terms, if not in buying power.

Hi Wayne, It is pretty well known that the long term trend has been a 60% rise in shares, measured weekly, monthly, yearly and since the beginning of markets here in the U.S. That's beyond dispute and is essentially a reflection of the long term trend of the country's economic growth. It...

tman, No, I haven't done anything with SPX weeklys, mainly because they are not very liquid and the bid/ask spreads are terrible. So, for me the SPX weeklys are purely hypothetical. Maybe SPY would be better? Perhaps you could check it out and post the results.

Hi tman, Glad to hear that you're going to give the technique a whirl. Of course, since I'm also trading it, I wish you the best of luck, lol. Re your, I guess, somewhat facetious question, I suppose anything's possible, but the optimistic bias of people generally probably precludes that...

heisasafari, This is a tempest in a teapot. My entire reason for posting this strategy was that I thought it might be helpful to Forum participants. Nitpicking and parsing definitions does not serve to encourage other folks to submit their successful techniques. In any case, I don't wish to...

heisasafari, With all due respect, it is an anomaly. Your point about up 10% not meaning the same as down 10% when the level of the index is considered is correct, but has no relevance to my definition of an anomaly. Ask someone who was long in the basket of stocks in 2001 that equalled the...

Howard, It's a simple 'metric'. If, in future months the credits received at initiation dwindle to below 2.00, then the expected ROI would be too low to be consistently profitable. I doubt seriously that the ratio of winning to losing cycles will change much, given the decade long recent...

Hi Howard, Back testing with a preconcieved notion of how a strategy might turn out is prone to 'fudging' the numbers to fit one's ideas. However, the settlement numbers don't lie, and the facts are that over a decade in which the SPX had a net 15% loss of value, nearly two thirds of the...

OOOOPS. I made a typo on the historical win/loss record of the SPX settlements. The correct figures are 74/45. Sorry for the goof, the coffee hadn't kicked in yet, I guess.

Hi JJacks, Your idea re downside protection is a good one. After all there is a significant number of down months in the strategy. Unfortunately, they appear in no discernable pattern. Importantly, protective puts ought to work exceptionally well in the SPX/SPY contracts because the down...