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Being right and getting the timing off is what makes money management around a directional trade the difficult part. You can hold until your right, but usually holding until your right involves higher risk. When you have that high risk what happens when your wrong? This is a reason why I believe...

20% so you may have a maximum of 5 trades on at any one time. When you say depending on the situation regarding taking profits I'm not sure how you will continue getting consistent returns without a consistent way to manage. I don't like stops in fact if you had used them you may have had...

I guess we need to define predictable. If predictable is that the SPY wont go to 0 or 1,000 by year end then it is predictable. I do predict a trading range (based on placing probabilities in my favor) as I sell premium but there is no way to know (In my opinion) for sure that when I enter a...

Anomalies do happen. I was thinking I could help this guy lower his risk. I'm pretty new to this forum too. Maybe it is BS.

It's all good were all just here to help and learn. We all have our own ways.

Sounds like you have something really good! Maybe you can give me a few directions on the SPY or whatever your trading. What do you say?

What type of risk are you taking? How much money do you apply to each trade in terms of percentage? Do you place stops? At what level do you take profits per trade?

I have a profitable system that is not dependent on picking the right direction, unless not picking a direction is a direction lol. Do you have or know of a system that predicts direction with any statistical significance? I am always open to learning something new. So far I haven't found that...

I do believe as you. Markets are random.

It is difficult to trade based on fundamental information for example a news story because like you mentioned computers are already processing and positioning based on that news. What that means to me is that the news is already baked in before you can trade based on it. Also even if you knew...

I have spent a lot of time searching for a system that can accurately pick direction. I have found that focusing on risk management or money management and cost basis reduction rather than focusing on direction is a way to find consistent returns.

Lol I used to think that way now I'm happy with a consistent 15-25% return.

Ok I see you do it for future adjustment purposes. Its basically part of your individual strategy.

You can create the exact same position with either ITM or OTM spreads. So why choose OTM? The advantage of using the OTM's is that if you are right you can let them expires worthless and save on the exit commissions. Also when you close that ITM spread if its a profitable situation and you wait...

Interesting strategy but why not sell OTM put credit spread with the credit being equal to your debit spreads width minus your debit. It would appear that you can accomplish the exact same position. The advantage of using the OTM's is that if you are right you can let them expires worthless and...

I agree! For a beginner it will really simplify and standardize the learning process. Once you grasp more (maybe after a few months) then look at ITM options because they do have there place with certain strategies. Its better to brake the learning process up into chunks and this is a good way...

Let me clarify if you are long then we are comparing a OTM call debit spread to a OTM put credit spread. This is where comparing put spreads and call spreads have a point. Both spreads have a long directional bias so the questions is how do you want to go long?

As we just discussed you can do either and obtain the same trade depending on being ITM or OTM. If we just talk about OTM strikes then purchasing a debit spread gives you more upside with a lower probability. If you have a strong directional bias then an OTM debit spread should be the choice. My...

Yes you are correct. I should re phrase that i am referring to OTM spreads, in which the debt and credit spreads would have different strike prices. I think it is easier to learn about spreads when you look at them as being OTM. I would recommend that thought process as a beginner. Thanks for...