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Hey ETs Question for you: So I understand that options are priced perfectly to reflect all possible outcomes. They generally all have an expectancy of zero over many many trades. For instance, if you sell a delta 0.10 option over and over again you will win 90% of the time and then 10% when...

Yes of course as I stated my data is limited and I am still in the process of collecting, hence why I mentioned there was only 66 data points. I was more so looking for different metrics and data analysis that would be useful to look at while analyzing data sets . This is just one of many...

Hey ETs I just started exported my trade data to excel to do some analysis and see how my system is going so far. My question for you guys is what are some key metrics that would be helpful in analyzing the data and determining whether or not my system has an edge. So far I have covered the...

Cool thanks guys. Was just curious, because I hear many new options trading talking about doing this like its a fool proof strategy. Obviously the data would say otherwise, and its more likely to underperform buy and hold the snp.

Hey Guru. Thanks for the response. So if i understand you correctly, selling puts, until assigned, then selling covered calls, until shares called away, then puts again and repeat,,, does not have a different outcome than just selling covered calls?

Hey ETs I am looking for some data on a strategy that I am having trouble finding a name for. I assume somebody has done backtesting on this strategy to see if it is profitable or not, but im having trouble finding any info. I do not use this "strategy" but am just curious as to what it would...

Thank you all for the awesome input, and especially RM for taking the time to speak on the phone. I will keep you all updated as to how my strategy works out.

I used deep ITM calls as a stock replacement, nearest expiration. Usually delta 0.8 , so time decay is not as much of a factor, but it does come in to play. Usually I am in and out within an hour or less.

I trade Spy. 5,15,30 minute time frames. I would use the last year.

Great info in that link. Question; how exactly do you go about backtesting? What software do you use? Where do you acquire your data? Do you need to be familiar with coding in order to backtest? Sorry for the elementary questions. Thanks for taking the time to respond.

I Its discretionary. I look for setups that have a high prob of success, and I only take entries where I see potential for a 1:2 risk reward. I do have some guide lines and setups that I consider attractive.

I do appreciate the input. I spend a lot of time in front of the screen but I realize many times that things are not as they seem at face value, and no matter how confident you are, mathematics and probabilities always work there way into the equation. I personally do not find any value in...

So using my original example : " if the stop loss and profit target were the same distance away (or 1:1 risk/reward), and I picked my trades blindfolded, I would have a 50/50 chance of winning or losing, and a zero expectancy over the long term." would this also be incorrect? Wouldn't you...

Essentially I am "assuming" that if the stop loss and profit target were the same distance away (or 1:1 risk/reward), and I picked my trades blindfolded, I would have a 50/50 chance of winning or losing, and a zero expectancy over the long term. Now, by increasing the distance of my profit...

Thanks for the response! I was hoping to get your attention. Now to clarify, there are some setups where I will risk more to make more, or risk less to make less, but Its always generally a 1:2 risk reward ratio. So for instance, on setups where I am more confident, I might risk 2 dollars to...

I have been trading for multiple years now with mixed success. I have taken the time to educated myself on different strategies and have found trading index options to be the most comfortable market for me. I would consider myself fairly educated on relating (retail) topics with the exception of...

So my initial thought process when I thought of the trade, without knowing what a box spread even was, was that I would be able to buy a put spread and call spread with the long positions deep ITM so there was little time value to lose, then have the short put and short call expire worthless and...

Thanks for the insight! I did do a little more digging on ET and realized people saying these arb opportunities are extremely rare and generally not realistic for retail traders, as they come and go very quickly, but the concept of is just so cool. So much good information on this forum!

Because, as the stock price moves past your short put strike, your making money on the long call and vise versa. Its a different risk profile.

The short strangle has a risk graph with unlimited loss potential past each short strike, where as the box spread is a complete horizontal line above zero (if cost of box is less than expiration value of box)... Very intriguing. Does anyone know if theres any scanners that scan for arbitrage ?