Ok, so I run a strategy that only uses available capital for a small amount of time and runs on a quarterly system. The question is, during the other 2 months between earnings announcements, how can I make an extremely small profit with very little risk? Treasury bonds? Stupidly wide iron condors? Reverse iron condors? Expiration time is 40-60 days. Also, as a side note, can certain government bonds can be used to satisfy margin requirements? For instance, can I use T-bonds to sell strangles against?
Very conservative consistent strategy?
- Thread starter lightfightercap
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Of market movement, volatility, and time, the one that pays the most is delta -- which is also the least consistent. Volatility pays okay, but is inconsistent: only when it drops quite low do you have the set-up you need for higher probability positions. Theta -- especially theta farther out -- is 100% reliable -- but pays like shit. But if you're only looking to beat "inflation+", then putting on some theta trades (especially with a rotation so that you harvest them before the delta risk becomes rude) should be just your ticket. If you sell a 4-strike for 50¢/strike, and buy back the further strikes at 15¢ a piece..... You'd sell it for $2, buying it back for 60¢{+commissions} while reducing margin exposure along the way. Map it out and see what you think.
GIC's or T-Bill's.
Very conservative consistent strategies and option strategies discussed in the same thread would be an oxymoron.
Anything that gives stable income for low risk. Right now I'm parked in T-bills paying 0.16% and selling CSP's in SPY with 30DTE for 0.15%
There must be something out there that do better than 0.31%
From what I've seen out on the option chains it seems that the only way to deploy credit trades far OTM are to do them naked as the verticals always seem to be within reasonable touching distance.
Volatility is low so the premium is not so high.
I've changed my strategy from selling premium to buying it.
Instead of using outright single leg call options for instance, I've been buying long ATM bull call spreads (or verticals) with 30DTE.
I've experimented with gamma scalping and delta neutral hedging but the commissions make that nearly impossible.
What I do like with these spreads is that you can find trades that have 1:2 R/R.
My understanding is that you are not running it quite yet, but that it's work in progress, right?
. In any case, since you are a master (or on your way to becoming one) of single stock options, it makes sense to look at other things to do there beyond earnings. That is probably a better solution than trying to constrain yourself to trading earnings season only and then sitting on your hands the rest of the time.My understanding is that you are not running it quite yet, but that it's work in progress, right?
I ran it last earnings season and was pleased with the results, but yes you're right, still in progress. Also, I am absolutely not a master of options, single or otherwise! I hate the idea of letting money stagnate in a trading account (as do most traders), but at the same time, making trades using varying entry parameters that I cannot easily backtest based on fundamentals and technical analysis is how I wiped out my first trading account. It is quite difficult to trade like this as a beginner, and probably takes years to become consistently profitable, hence the low retail trader success rate. I cannot make the same mistake again, and I almost want to develop some new system for the dead months, but that's not easy. Additionally, I like your name or whatever its called.