SPX Credit Spread Trader

rdemyan

I was wondering if you leg into your spreads ie.. (long call first, short call or long put, short put) or do you just enter a vertical spread, it seems you'd get better fills if you leg in one at a time. Any thoughts on this.

It would sure help if I could get the rates your getting with ToS, I'll give them a call an let everyone know the outcome.
 
When I negotiated my commission rate with ToS, I did mention TheOptionClub.com and I also documented what ToS and I agreed to in an e-mail.

I just checked that e-mail and here's one of the points I documented:

"There is no minimum number of trades that I'm required to make."

They agreed to it. Don't know if this is still available, but hey, it can't hurt to ask. These guys are all traders and they're used to people negotiating, so just ask.



Quote from Cache Landing:

It's not as much about account minimums as it is about trade volume.
More...
 
Donna's the right person to ask on this.

I don't have women's intuition (by design I guess :)). She has been quite successful so far, but pretend I didn't say that, as I don't want to jinx her. However, I believe she's started legging into a trade today.

Quote from Shams78:

rdemyan

I was wondering if you leg into your spreads ie.. (long call first, short call or long put, short put) or do you just enter a vertical spread, it seems you'd get better fills if you leg in one at a time. Any thoughts on this.

It would sure help if I could get the rates your getting with ToS, I'll give them a call an let everyone know the outcome.
More...
 
ok...I've had good success legging into the put side. I've only tried legging into the call side once (last oct when we were really oversold). I have been left with legs dangling but if you are comfortable with that......
 
Speaking of legs, I believe you owe me a little "quid".

Quote from DonnaV:

ok...I've had good success legging into the put side. I've only tried legging into the call side once (last oct when we were really oversold). I have been left with legs dangling but if you are comfortable with that......
More...
 
Dangling legs? What's not to be comfortable about that????

:D

Quote from DonnaV:

ok...I've had good success legging into the put side. I've only tried legging into the call side once (last oct when we were really oversold). I have been left with legs dangling but if you are comfortable with that......
More...
 
My risk management plan is to place FOTM credit spreads & IC on the SPX with the intention of taking off the bad side if its within 10 points of my short with more than 20 days to expiration. If I'm trading a 10 lot I'll cover my short side for a loss an look to place a new trade at about 1 SD from current price, with a lot size of 15 inorder to cover my loss an possibly still be profitable by expiration. My theory is that if the index made a one SD move on my original trade It's unlikely it will do it again in one month, I know its possible for a 2 SD move in one mth but I feel the probabilities are in my favor. I've read how many of you hedge your plays with the SPY but I'm still not clear on when and how to implement that strategy.
 
Bob and Cache Knock in off:eek: your plan is good...the truth is that it will take a few months and a few close calls to refine your plan. I think you take adjustments when you need to. If you are far enough out of the money you will seldom need to adjust.
 
One other thing to consider, and you'll see that Coach always posts this in a response when people ask him about the risk on his positions, is that you don't want your entire portfolio invested in credit spreads. You don't want to be in a position where one event or bad move can wipe you out.

I believe Coach uses 33% as his benchmark (but rest assured he'll correct me if I'm wrong), which can vary somewhat depending upon the market. When things go wrong, the idea is to get out with as little loss as possible and live to trade another day.

I mention this because I got the impression that your account is not that large (yet, anyway) but your plan is to increase from 10 contracts to 15 contracts if you have to adjust or close out a threatened spread. How would that effect the percentage of your portfolio devoted to spreads?



Quote from Shams78:

My risk management plan is to place FOTM credit spreads & IC on the SPX with the intention of taking off the bad side if its within 10 points of my short with more than 20 days to expiration. If I'm trading a 10 lot I'll cover my short side for a loss an look to place a new trade at about 1 SD from current price, with a lot size of 15 inorder to cover my loss an possibly still be profitable by expiration. My theory is that if the index made a one SD move on my original trade It's unlikely it will do it again in one month, I know its possible for a 2 SD move in one mth but I feel the probabilities are in my favor. I've read how many of you hedge your plays with the SPY but I'm still not clear on when and how to implement that strategy.
More...
 
w03ser.jpg
"Another good month boys and girls......."






P.S. how is this woman not anyone's type :p
 
You must log in or register to reply here.
Back
Top