SPX Credit Spread Trader

Quote from Zegras:

I have been trading Short Iron Condors for quite some time and I have found a few good sites that actually auto-trade these for me. I prefer to only use SPX and a few other European style options but that discussion is for another day. There are a slew of newsletter services who disguise there straegies as an innovative, proprietary strategy when indeed the only strategy they use is the Short Iron Condor strategy. A few services that offer these that seem to do a god job are www.wiseoptions.com and more recently www.crowderinvestments.com. Crowder only offers trades in his newsletter but I think he might actually start to auto-trade condors in the near future. Not sure about that one though. One thing is for certain, I recently came across his White Paper and was amazed by the in-depth discussion of the Short IRon Condor strategy. What seperated their work with others that I have read is that he offered exit strategies. DOes PArnos also trade Short Iron Condors? Does anyone know how good his service is? Also someone recommend some other sites that trade or discuss Sohrt IRon Condors? I think I have pretty much covered them all but I am always happy to educate myself further on what I feel is one of the top three options strategies.
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check out this thread started by Electric Savent (sp?)

http://elitetrader.com/vb/showthread.php?s=&threadid=67025&highlight=crowder+investment

if you read thru it I believe the general consensus was the auto-trade services inc the above mentioned were not worth it.
 
Quote from Zegras:

I have been trading Short Iron Condors for quite some time and I have found a few good sites that actually auto-trade these for me. I prefer to only use SPX and a few other European style options but that discussion is for another day. There are a slew of newsletter services who disguise there straegies as an innovative, proprietary strategy when indeed the only strategy they use is the Short Iron Condor strategy. A few services that offer these that seem to do a god job are www.wiseoptions.com and more recently www.crowderinvestments.com. Crowder only offers trades in his newsletter but I think he might actually start to auto-trade condors in the near future. Not sure about that one though. One thing is for certain, I recently came across his White Paper and was amazed by the in-depth discussion of the Short IRon Condor strategy. What seperated their work with others that I have read is that he offered exit strategies. DOes PArnos also trade Short Iron Condors? Does anyone know how good his service is? Also someone recommend some other sites that trade or discuss Sohrt IRon Condors? I think I have pretty much covered them all but I am always happy to educate myself further on what I feel is one of the top three options strategies.
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Thanks Zegras. I always appreciate the perspectives of services trying to operate for profit and enjoy reading their technical analysis and rationale in their systems. I usually get new depth of understanding or discover a few new subtleties as I read their marketing info and data.

Another person I came across in casual research on profitable credit spread writing/trading is a person by the name of Brad Griffin. He apparently has a pretty good track record and has the novel marketing approach of only charging a relatively minor fee for those trades he recommends that actually result in a win. I have never seen another service offer this kind of "pay me only if I deserve it" guarantee before. He basically goes into deep space very far OOM with very small credits (.25). He nets smaller wins at a consistent win rate that exceeds my own personal system and trades various ETFs. Since I am not as well versed in other underlyings as I am in SPX I have considered subscribing to him just to get an expert initiation into other ETFs to diversify my trading choices. Frankly, I am not too comfortable jumping in on these other non-cash settled American style ETF options with more than a few contracts without an expert introduction and a little hand holding. I shudder at the prospect of having to cough up a ton of underlying shares in a panic during an assignment and have no insight into how often that happens in the non-cash settled ETF arena.

Here is a link to his site and blog that I will share.
http://www.indexspreadoptionstrading.com/index.html
http://indexoptiontrading.blogspot.com/

TS
 
Quote from Zegras:

I have been trading Short Iron Condors for quite some time and I have found a few good sites that actually auto-trade these for me.

www.wiseoptions.com and more recently www.crowderinvestments.com. Crowder only offers trades in his newsletter but I think he might actually start to auto-trade condors in the near future...
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Ack! After checking out the wiseoptions link I noticed the advisor is Erik Epp, Ph.D.

Run like hell from this guy since I have heard horror stories about his system. He also offers the same system under another alias subscription called "Three Minute Trader" (http://www.threeminutetrader.com/index.php) that is now sponsored by a few dubious newsletter publishers and affiliate programs (Agora, and Early to Rise) . What I have heard is that this system is snake oil and very expensive snake oil at that. The subscription price will wipe out your small returns that do come in. So you take all the risk to make him and his sponsor a huge percentage of your net profits. The system will never get you out of a position until its way too late and you will lose a ton of money when it goes bad. Their bulletins and late adjustments are usually full of errors and typos and I have heard they even have told to adjust positions at strikes that they did not even originally give recs on! I have heard that its extremely hard to get in on their recommendations at the spreads they send out since the market moves so fast away from them that you never get fills. One person told me their customer support is like a boiler room operation. You call and no one answers the phones or returns calls or responds to emails. He has left many inexperienced traders dangling helpless in soured positions with no effective guidance, no remaining margin to get out or adjust with and has a heavy loss lately. His marketing hype claims he could turn $20K into a million in a few year but does not tell people if you have an early loss you have no trading capital left and you are wiped out and must ante up another $20K. I can't imagine how many newbie traders using their only $20K spendable family cash on a get rich quick promise he ruined in 2006.

TS
 
Quote from domestic:

i should really know this....does anyone know where i can chart an option (ie: spx put 1410) from its' inception to current, just as one can chart the underlying? no paid sites please. if this can be done in ib(am not adept with modeler), just acknowledge and i will try. thanks
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i figured it out in ib.

thanks
 
Quote from tyrant:

At current volatility, roughly how many pts or % equates to 1 sigma in SPX? How about in ER2?

Thanks in advance.
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SPX for FEB expiry 1sig = about 35points at current volty.
 
"SPX for FEB expiry 1sig = about 35points at current volty."

Ay, there's the rub :)

Mechtrade's very interesting chart is a perfect visual for this. If you were using the bands to place shorts for May or June, you had to be aware of what can happen when vol picks up.
 
Quote from jeffm:

"SPX for FEB expiry 1sig = about 35points at current volty."

Ay, there's the rub :)

Mechtrade's very interesting chart is a perfect visual for this. If you were using the bands to place shorts for May or June, you had to be aware of what can happen when vol picks up.
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Yes, when volty picks up your 1s range widens quickly.
 
I've been busy lately and haven't done much trading, just lurking. I'm getting back in the saddle again in a small way. Here is what I have now:

SPX Diagonals
Feb/Mar 1475/1495 calls $1.40 debit
Feb/Mar 1365/1385 puts $2.40 debit
Feb/Mar 1425/1430 puts $4.70 debit (half size)


RUT Diagonals
Feb/Mar 730/750 puts $2.04 debit
Feb/Mar 830/850 calls $1.23 debit
Feb/Mar 780/790 puts $3.15 debit (half size)

Flame away!
 
Quote from MechTrade:

...
Is there a consensus that the calculation is a reasonable proxy for Sigma-1?

D
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I looked at the chart. The only comment I have is that the bands all contract to what appears to be zero at option expiration or last trading day (can't tell from the scale which). I suppose that's a true mathematical effect since trade freeze on 3rd Friday (SPX) means no pragmatic volatility (even though its still in the markets). But I think the equation injects a windowing effect at the start and end of the period. So for SPX it ignores the SET volatility/variation artifact generated by a synthetic market open.

If you want to get into really something sexy it would be very cool to overlay the SET historical volatility for SPX on SET formation day as a separate colored vertical band. That might prove very interesting to those of us who routinely play front month and attempt to hold through expiration when the position is looking very solid. hopefully it won't clutter up your pretty graphic too much.

Just ideas. Good work, and much appreciated.

TS
 
Quote from TrendSailor:

I looked at the chart. The only comment I have is that the bands all contract to what appears to be zero at option expiration or last trading day (can't tell from the scale which).
I suppose that's a true mathematical effect since trade freeze on 3rd Friday (SPX) means no pragmatic volatility (even though its still in the markets).

TS
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Master of the Obvious! :D
 
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