SPX Credit Spread Trader

Glad to see the new traffic on the forum.

Murray... missed you.

OC... Glad to see some new strategies discussed. You moderating skills are of 'stand out' quality on ET.

I've spent a good bit of effort studying and trading Dan Sheridan's Condor, Fly & Calendar strategies. (I've look @ Double Diagonals but have not been particularly enthused by them yet).

The Fly's have worked out OK because of the accelerated theta decay. The Cals have not done so well, but I think it is because I have mismanaged them, so I'll take another try at them with stringent 'plan following' efforts. And the Condors are doing OK considering the big moves in the market of late. No losses so serious as to deter me from continueing to develop my skill sets.

The Condors I treat as individual Verticals and for adjustments I set up GTC stops against the Short positions so that in fast market conditions the Long legs might quickly recover the small losses incurred on the Shorts. I am rarely more than an hour away from my trading platform, so if I get caught in a whipsaw, it won't get too far away from me.

Using both IB and ToS accounts on same trades to compare entry and exit executions. ToS has superior trading platform while IB seems to have better executions around Bid/Ask in fast market conditions.

Coach... Perhaps you might consider moderating a new forum with a broader trading focus than SPX Credit Spreads. Also, I picked up on your ES trading successes that you might want to include in the subject matter.

Mech
 
Mech,

I have the same experience with TOS and IB. If I set up a trade and take the (mid-)price that the TOS platform gives me for a spread and enter that at IB, I mostly get immediate fills.
I find that very curious! Do you have an explanation for that?

gis
 
Quote from MechTrade:

Glad to see the new traffic on the forum.

Murray... missed you.

OC... Glad to see some new strategies discussed. You moderating skills are of 'stand out' quality on ET.

I've spent a good bit of effort studying and trading Dan Sheridan's Condor, Fly & Calendar strategies. (I've look @ Double Diagonals but have not been particularly enthused by them yet).

The Fly's have worked out OK because of the accelerated theta decay. The Cals have not done so well, but I think it is because I have mismanaged them, so I'll take another try at them with stringent 'plan following' efforts. And the Condors are doing OK considering the big moves in the market of late. No losses so serious as to deter me from continueing to develop my skill sets.

The Condors I treat as individual Verticals and for adjustments I set up GTC stops against the Short positions so that in fast market conditions the Long legs might quickly recover the small losses incurred on the Shorts. I am rarely more than an hour away from my trading platform, so if I get caught in a whipsaw, it won't get too far away from me.

Using both IB and ToS accounts on same trades to compare entry and exit executions. ToS has superior trading platform while IB seems to have better executions around Bid/Ask in fast market conditions.

Coach... Perhaps you might consider moderating a new forum with a broader trading focus than SPX Credit Spreads. Also, I picked up on your ES trading successes that you might want to include in the subject matter.

Mech
More...

There are not a lot of great adjustments for ICs. You either adjust up, out or close or convert the position into a FLY if it costs less do to so than close the position outirght. The real key to success if you trade these is knowing when to simply get out before the market runs you over. Also I sometimes add deltas through partial hedges or even futures but this is still a momentary hedge to give me time to analyze the situation.

I adjust up when expiration is close and I want a little more cushion and I do not expect the market to keep running as far as it did. But in most cases just get out and look for another entry if possible.

Diversification is key as well. Instead of pure IC plays you can add calendars, long condors and differet types of butterflies to play market direction or lack of.

Just dont get caught like a deer in headlights hoping an index move will bail you out :)
 
Quote from gismeu:

Mech,

I have the same experience with TOS and IB. If I set up a trade and take the (mid-)price that the TOS platform gives me for a spread and enter that at IB, I mostly get immediate fills.
I find that very curious! Do you have an explanation for that?

gis
More...

Don't know for sure why IB gives better fills, but wonder if their platforms 'Smart' order matching routine includes internal IB customer orders in addition to market makers.

What I do know is that when I am occasionally forced to place market orders to get out of a situation quickly, at IB I have never been filled at worse than the printed bid/ask (even on spreads), while at ToS I've gotten filled at prices worse than printed bid/ask.

Additionally, it is not unusual at IB to get order fills at better than my specified limit or printed bid/ask.

To be fair, I don't have as much order execution experience at ToS as I do at IB. So it will will take a few more months for me to make a final judgment.

Right now I have an identical NDX position on at both brokers and have identical stop orders in place that may get triggered in the next few days. It is this type of situation that will ultimately tell the tale.
 
Quote from MechTrade:

Right now I have an identical NDX position on at both brokers and have identical stop orders in place that may get triggered in the next few days. It is this type of situation that will ultimately tell the tale.
More...

NDX failed to trigger my Stops on Aug IC Short Puts.

So I exited my Aug Call side verticals @ .20 and entered new Aug Call side verticals @ 1 StDev for credits ranging from $1.70 to $1.90.

On both the exit and re-entry, orders were entered simultaneously @ IB & ToS. IB filled quicker.

I'll quit nit picking broker executions.

My real point of the post is that NDX credits seem to be among the best that I've found since branching out from SPX, even though mid point executions are sometimes problematic and have to be probed.

Anyone else care to share their favorite indexes and which strategies they like with each index?
 
Quote from optioncoach:

I finally got fed up with SPX wide abusive spreads and just trade the NDX now since the beginning of this year.
More...

Thx for sharing and nice to know.

I used RUT for Flys and accelerated Theta worked OK, but current RUT hyper-volatility is a challenge in this 'sub-prime' credit problem environment.

I've tried Calendars on individual stocks, but earnings and other issues that influence specific stocks require too much attention, luck and risk.

And while there are a bunch of Euro style index options, trading volume and open interest really restrict the number of ones that are safe to take positions in.
 
Quote from stupididiot:

Any advantage of NDX over NQ?
More...

Most brokers do not have options on futures so NDX is easier to trade at places like Tos or OX, with IB being the exception. I would have to trade 5 NQ per NDX contract so NQ spreads might be more commission intensive for same basic margin.

NQ does allow for SPAN margining but for credit spreads it is a good idea not to try and over leverage yourself.
 
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