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I can live with that for now. I am still trying to find the best IV parameters for entry that raise my PoP by 21 DTE. Hope the public forum will help me find it.

Thanks, appreciate it. Second, I like butterflies due to the way they allow you to structure your trades. I find them much easier to be profitable, especially in higher IV environments, than say credit spreads. I also find it fascinating to watch how the structure of the fly alters the...

It is funny how that works isn't it??

3/1 - Greeks look good: Graph looks good Nothing for today. More upside means I need to watch Vega at this point.

I appreciate the insight. You're right that I simply don't have a good model for prediction at this time. However price isn't the sole determining factor in my adjustments, the primary drivers will be the greeks, namely delta. The presentation your discussing sounds like Locke's Bearish...

That's the plan my man! I don't think the overstated IV is necessarily the only edge, I just don't have the sophistication in the options world to really describe the nuances. The trade really does seem to revolve around the fact that theta decay increases dramatically towards expiry, and...

Yes, agreed, however the nature of the adjustments and their greek structure is what is meant to consistently provide a profitable trade (supposedly). I would suppose the edge comes from the fact that since IV is overstated 99% of the time, a properly managed position like this should be able...

I agree 100% on the first part. I would the think the large width of the strikes coupled with the hedge would help. Locke has a lot of videos showing the trade in swings of 100+ points over a short time period coming in OK, but in the end it's still a trade, requiring steel balls and good...

Can you explain why that is a fatal flaw? I have seen the trade profit in both high and low IV. I would imagine there are parameters where one could profit faster/more because of IV conditions (or lower risk), but if the profit target is but a small portion of the overall profit potential of...

I would guess the positive expectation comes from the fact that I'm taking only a small portion of the max profit, and the trade is designed to stay theta positive. Ideally entry would happen after a sharp spike in IV, but during periods of extended lower volatility, I haven't seen that be an...

I'm sure it was! I just stumbled over his teaching of it. The analysis of this particular trade has taught me a lot so far, and Locke has a good way of teaching it. By all means please point out flaws in the methodology, but I think you've made your point that you simply don't like the...

It's a pure time trade with planned capital and established P/L I suppose. I am not sophisticated enough yet to use these sorts of things to my advantage, which is exactly why I sacrifice profit for the call hedge. I need a wide berth. In backtesting, volatility really came into play mainly...

There is a pretty growing industry using the butterfly for the "common man", but I would argue that's because the butterfly is a good trade all around. I am not doing any type of coursework, mentoring, group membership, or anything of that sort. I just like this trade because the loose trading...

I appreciate the analysis. Adjustment and/or adding call/put verticals to fine tune the greeks are a pretty decent part of the trade to account for moves, and in backtesting over the last 5 years, there were very few large moves that couldn't be traded around for at worst a small loss. We'll see.

Hello all I am going to be trying a trade in 2019 that, when backtested, gives some pretty nice returns. This is NOT my trade, it was crafted by John Locke, and is called the M3. I will be trading the RUT options exclusively, using a max planned capital of $50k, and P&L numbers will be...

I remember you catching a lot of hell for claiming this V shape up-move was "in its infancy" back in early January. Very nice call.

That's amazing, thanks for posting.

Learn to read the tape.

You try and we'll watch. :)

So your original stop was 117 points below your entry. Out of curiosity, does that mean your price target is at least 234 points above it?