Directionally trading SPY weekly option strikes

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edkowalski

Looking for a mentor but this post is also just to get feedback on the probability of success and me making a living from this system/approach. Basically I was taught by a novice mentor how to trade weekly option strikes on SPY using MACD/Stochastics on 3 charts (1min, 5min, 15min). I have been at it on and off for over 2 years and needless to say lost a lot of money when starting because of poor habits taught by this novice mentor (averaging/doubling down, no stops etc).

Looking for some input as to the probability of me making a go/living at this with a $30,000 account. Likely? Not likely? Looking for around $8000 a month in income.

Also any recommendations as to a real mentor would be helpful.

Ed
 
So you are looking to make 8000/30000 = 27% a month or 320% a year.

:D

By doing what? Trading options? Daytrading futures?

You are on a well travelled path to losing all your money trying for a miracle.

There may be people who day trade futures who achieve this but I don't know of any. I HAVE known quite a few who tried.... succeeded (more or less) for a short time.... and then lost everything.

I'm pretty sure it can't be done trading weekly SPY options.

The best you can hope is a quick death.....i.e. crap out early so this foolish venture doesn't consume too much of your time and energy.

http://en.wikipedia.org/wiki/Taleb_distribution
 
edkowalski said:
Looking for some input as to the probability of me making a go/living at this with a $30,000 account. Likely? Not likely? Looking for around $8000 a month in income.
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oldnemesis said:
I'm pretty sure it can't be done trading weekly SPY options.
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I would say the ONLY way is to buy SPY weekly options and hold at least for 1 day, or buy weekly options on QQQ, DIA, AAPL, GOOG or other high profile stock. Preferably just calls or puts, avoid debit spreads and strangles/straddles.

Limit all trades to $1000.00.
 
I have done some math on spread trading in the current market environment. I think you could probably pull 2%-3% per week. I'm probably dreaming, but that's what my expectancy calcs show on a reasonable sample of trades spreading stocks with weekly options, after commissions. As in "put on 5X $1K spreads, make $130 each week" kind of thing. It sounds like chump change but if it holds up going forward, it's pretty attractive.

Those are bull spreads, by the way. I haven't looked at bear spreads yet, but I have done enough backtesting to belive that shorts can be swing-traded in most market environments and range from mild annual loss to huge annual gains. The key is offsetting the mild annual loss with appropriate long trades.

At any rate, I imagine it would be possible to book 10% per month in this environment with reasonably quantified risk and reward. I have also been known to do stupid things like lease cars, too, so caveat emptor and carpe diem. And semper ubi sub ubi.
 
edkowalski said:
Looking for a mentor but this post is also just to get feedback on the probability of success and me making a living from this system/approach. Basically I was taught by a novice mentor how to trade weekly option strikes on SPY using MACD/Stochastics on 3 charts (1min, 5min, 15min). I have been at it on and off for over 2 years and needless to say lost a lot of money when starting because of poor habits taught by this novice mentor (averaging/doubling down, no stops etc).

Looking for some input as to the probability of me making a go/living at this with a $30,000 account. Likely? Not likely? Looking for around $8000 a month in income.

Also any recommendations as to a real mentor would be helpful.

Ed
More...
 
edkowalski said:
Looking for a mentor but this post is also just to get feedback on the probability of success and me making a living from this system/approach. Basically I was taught by a novice mentor how to trade weekly option strikes on SPY using MACD/Stochastics on 3 charts (1min, 5min, 15min). I have been at it on and off for over 2 years and needless to say lost a lot of money when starting because of poor habits taught by this novice mentor (averaging/doubling down, no stops etc).

Looking for some input as to the probability of me making a go/living at this with a $30,000 account. Likely? Not likely? Looking for around $8000 a month in income.

Also any recommendations as to a real mentor would be helpful.

Ed
More...
 
Results

You enter the market on January 2, 2018 with $5,000 in your account. You buy either puts or calls at the given stike price of the day. You are always in the SPY option chain that is the closet to expiration, so either zero or one day is left to expiration. You hold the position until your goal had been met, a stop loss is triggered or the indicators suggest an exit. Six months later you account has $238,000 in it.
 
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