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I've determined, for now, that a back/ratio spread type of a transaction is a great way to enter the market when volatility is very high. Same thing as a vertical. A back/ratio simply makes your position more bullish or bearish. You can certainly create a bullish/bearish vertical, but your max...

also keeping in mind that if I do turn my position into a vertical, that I would have to be aware of whether it's a bullish or bearish vertical. If I have long 2030 calls and I see it could be turning down, I can sell 2025 calls to create a "bearish" vertical. In turn, if I am long calls and I...

As a follow-up to this, I've found that turning my position into a vertical, rather than a straddle, is more efficient, because it returns buying power to me. Buying the opposite direction and manually creating a straddle (buying an equal amount of long Puts if I already hold "x" amount of long...

Puts are definitely less forgiving it has seemed like. That's why doing a back/ratio where you are both long and short, works effectively, especially when volatility is high. If the skew really flattens, I would hope I would already be out of that position and into one that takes advantage of...

Understood. I'm partially using it as a way to buy myself time in making a decision to close my position (aka impulses). Since this strategy will manage some of the risk, and give me a "little" peace of mind. Though I did experience today a profit of $1.9k, and after the $35 fees and any small...

Also, when I did this spread this morning, volatility on both sides were about the same, so going with a 1:2 ratio was what I chose to do, basically hedging half the risk if the market pulled a fast reversal and never retraced back. If volatility wasn't equal on both sides, I believe I would...

Actually I've found the call side to work fine. You would only pick the call side if you see the index being greater than what it's at when you purchase (aka, you think it's headed up). Picking the correct combination of strikes is very important though. This morning for example, I did the...

Right. When I say day trading, what I mainly mean is opening my position in the morning, and closing ether once the index reached its range, or close at market close. Basically just not holding overnight. Today for example, I only did 4 transactions.

For anyone interested, this short article pretty much sums up why this strategy is decent - http://m.futuresmag.com/2012/02/20/establishing-option-put-ratio-back-spread?page=1

I have recently decided to backtest this strategy, and so far, it appears to perhaps be the best all around strategy for my day trading SPX options. It requires an idea, or best guess, as to which direction you see the market heading. Bullish - Sell 1 lesser strike Call + Buy 2 greater strike...

It's a good approach, if you have buying power to be able to do this. At least for me, I much rather hold equal amount both directions while the market decides where it's headed. And yes, you're right . When it comes to text, adding any type of "emotion" to something that is written is hard to...

Strategy worked decent today. My put went from $13 to $16 this morning. I bought calls when the put was lingering around $16, and when spx looked like it may have hit its range/predicted move. I then eventually got rid of the puts, while the calls were already in my portfolio and increasing. I...

Ah right, because SPY can actually be traded, while SPX is only traded with options. Yeah, shorting limits quite a lot more than buying, which is one thing that's so great about option trading, in that you can buy both directions, while one direction is betting on the underlying going down in...

Sheesh. So this post is becoming what I had originally stated that I see a lot on here, where others who are "very experienced" have to write out long power replies. I actually didn't write out everything I know, everything I have done, etc., because I didn't want to. I have spent countless...

Also, when you say "Just shorting SPY stock against your long calls", are you referring to selling naked calls (if I already had a position of long calls)?

Hi Xela, CBC, and Handle: Apologies if I offended anyone by writing that I don't need long posts telling me that I need discipline. I am new to this forum, and have read other posts where OP asks a question, and the majority of comments are others joking around (trolling a user's lack of...

I don't believe I am able to trade futures, not sure why. Maybe I would have to request it. Are you saying hedge myself with futures, by buying the opposite direction in futures? Basically a straddle, using spx for one direction and /es for the other direction?

Lol, yeah, I don't need long posts explaining to me that I have to pay fees, and that I lack discipline. I already stated that I'm new to trading, so trolls can exit. I'm here looking to share and compare ideas, knowing that many of my ideas area amateur or completely idiotic. I don't plan on...

Anyways, I have replayed a few days using this method. TD Ameritrade's thinkorswim application provides you the ability to actually replay previous trading days, and actually make trades using fake money. It's essentially papertrade, but you can pick whatever previous day you want. So far...