Popular Post Yowster Posted December 30, 2025 Popular Post Posted December 30, 2025 As I do at the end of each year, I’ve broken down the Steady Options 2025 trade performance by trade type. Numbers were taken directly from the data in the Performance screen (plus some recently closed trades). Here’s are this year’s stats along with some comments from my perspective. Where applicable, I added totals from prior years for comparison. Unfortunately, 2025 was Steady Options worst performing year. I’ll try to present what I believe to be the main reasons for this as they apply to each type of trade. From an overall perspective, here are some key points that I believe factored into the performance: Most SO trades are Vega positive trades leading up to earnings events, so volatility plays a key role in the outcome of our trades. Volatility rising helps trades and volatility declining hurts trades. 2025 saw 4 VIX spikes that occurred rather quickly (not a gradual rise), most spikes were relatively short in duration with declines starting shortly after the spikes. When you look at the year in total, the vast majority of the time we were in time periods where volatility was falling. Trades that were in place prior to the spike performed well, but other trades that did not encompass a spike commonly dealt with falling volatility and RV declines bigger than prior earnings cycles. This meant that trade that would have been small to moderate gains in prior years turned into small to moderate losses this year. Losses above 10% were also more common. There were some things that worked very well this year, although they were in some of the portfolios outside of SO. Steady Yields (SY) and Simple Spreads (SS) performed very well as many of their trades were helped by the same things that hurt the SO trades. Most trades in SY and SS tended to be Vega negative, meaning that they were helped by declining IV – so both time decay and declining IV helped these trades. Pre-Earnings Calendars 24 Trades – 21 win, 3 loss (88% win) – Average Gain +8.77% 2024: 65 trades (81% win) – Average Gain +12.13% 2023: 65 trades (85% win) – Average Gain +9.56% 2022: 11 trades (64% win) – Average Loss -9.55% 2021: 110 trades (79% win) – Average Gain +12.82% 2020: 33 trades (85% win) – Average Gain +21.97% 2019: 54 trades (65% win) – Average Gain +9.27% 2018: 40 trades (78% win) – Average Gain +9.61% 2017: 31 trades (84% win) – Average Gain +13.81% 2016: 44 trades (80% win) - Average Gain +15.07% 2015: 51 trades (80% win) – Average Gain +12.67% 2014: 48 trades (71% win) – Average Gain +13.80% 2013: 24 trades (88% win) – Average Gain +20.60% Comments: Overall winning percentage was at the high end compared to prior years, but average gain per trade was at the lower end. This year lacked some larger gains that we got in prior years (likely due to volatility declines). Number of trades was much lower than most prior years as this year saw the calendars for many stocks having their calendar RV significantly higher than prior cycles, and therefore trades were not opened in these cases. There was a learning here to take forward into next year. For calendar trades entry we look to enter at lower RV levels and/or on stocks that show a pattern of rising calendar RV heading into T-0. Many stocks show a tendency for calendar RV to rise regardless of current levels, but we didn’t open trades on these stocks if the current RV was elevated. While we wouldn’t want to enter if calendar RV was sky high, hindsight showed that opening trades when RV was slightly to moderately elevated wound up being winners. Earnings calendars continue to be a core SO strategy. Straddles/Strangles 42 Trades - 21 win, 20 loss, 1 break-even (51% win) – Average Loss -0.56% Breaking down further by hedged and non-hedged: Non-Hedged – 21 win, 17 loss, 1 break-even (55% win), average gain +0.24% Hedged – 0 win, 3 loss (0% win), average loss -10.97% 2024: 57 trades (73% win) – Average Gain +4.72% 2023: 166 trades (64% win) – Average Gain +1.65% 2022: 148 trades (71% win) – Average Gain +4.89% 2021: 129 trades (68% win) – Average Gain +3.27% 2020: 118 trades (67% win) – Average Gain +2.80% 2019: 106 trades (68% win) – Average Gain +3.58% 2018: 72 trades (83% win) – Average Gain +5.40% 2017: 77 trades (79% win) – Average Gain +5.02% 2016: 18 trades (72% win) – Average Gain +5.19% 2015: 44 trades (68% win) – Average Gain +2.61% 2014: 74 trades (62% win) – Average Gain +2.54% 2013: 104 trades (57% win) – Average Gain +1.35% Comments: Lower number of straddle/strangle trades compared to prior years, due primarily to double diagonal (DD) trades which have similar gain targets to straddles and strangles but can be kept open longer. Overall winning percentage and average gain per trade were at lows. This is primarily due to the decline volatility which saw straddle RV dropping by larger percentage compared to cycles in prior years. When the stock price did moves, gains were often muted when factoring in the larger RV declines. From a downside risk perspective, we saw more losses above 10% compared to prior years with 7 of the 20 losing trades having a loss greater than 10%. 12% of trades hit 10% gain target, which is lower compared to prior years. These trades remain low risk trades as it takes RV dropping much more than their prior cycle tendencies to be significant losers – unfortunately we saw more cases of the outsized RV drops this year. Double Diagonals DD trades have the goal of having performance similar to straddles/strangles – but have the ability for the trades to be open for much longer periods of time (up to 3 weeks prior to earnings) giving the stock more time to move but still have minimal downside risk. 48 Trades - 28 win, 19 loss (60% win) – Average Gain +0.79% 2024: 52 trades (73% win) – Average Gain +4.86% Comments: Winning percentage was down from last year and average gain per trade was only slightly positive. Again, a result of RV declines more than prior years. What were small winners last year because small losers this year. Last year, all losing trades were under 10% losses (majority of losses were under 5%). This year we saw 6 losses above 10%, but all losses were under 20%. The DD trade is a low risk trade type with minimal downside risk, but this year has shown that when RV declines are more than expected then losses in the 10%-15% range can occur if the stock price doesn’t move. 25% of trades hit 10% gain target (compared to 35% last year). This is not a huge difference, it means that when the stock price moves you can hit that 10% gain target regardless of what happens with RV. Pre-earnings Iron Condors In the 4th quarter we introduced the pre-earnings Iron Condor (IC) trade as a way to get a Vega negative trade type into the SO mix of trades. We targeted stocks that have a consistent and large straddle RV decline heading into earnings whose historical straddle performance show mostly losing trades (meaning the stock price doesn’t tend to move a lot prior to earnings). 10 Trades - 7 win, 3 loss (60% win) – Average Gain +0.07% Comments: Large percentage of winning trades, but one of the three losing trades was an oversized loss when stock price made a big move corresponding to a larger market downturn. Will continue with these trades in the future, trying to limit those bigger losing trades by keeping risk vs reward near equal and by selecting stocks whose straddle RV decline is both large/consistent and happens in a relatively short period of time. Other Trades Non-Earnings RICs: 2 win, 1 loss (67% win) – Average Gain +0.00%. These non-earnings trades have higher downside risk if stock price doesn’t move. In this case the 1 loss equaled the 2 wins. Hedged ratios and BWBs: 2 win, 3 loss (40% win) – Average Loss -10.90%. These were hedged directional trades, the losses were larger when the stock price didn’t move in the right direction. S&P500 addition date trade: 1 win, 2 loss (33% win) – Average Loss -14.50%. These trades play for stock price decline (or at least staying flat) after the S&P500 addition. The pattern of prior year additions was broken this year. Several of the additions this year had much less lead time compared to prior years, so this might be a factor. Summary 2025 was a very challenging year for the Steady Options model portfolio. We used the same types of trade setups and analysis that has worked for us year after year. However, the market behavior this year yielded underperforming trade results. Going forward, we will continue to try to optimize trades and limit losses – but one underperforming year does not mean we need to re-think every type of trade as they have performed consistently well in prior years As always, I’d like to highlight and thank the SO community. We continue to have a group of very smart people that seems to grow each year who share their ideas and knowledge – this is what makes SO great. Looking forward to a better 2026. 11 2 3 Quote
Canuck_Dave Posted December 30, 2025 Posted December 30, 2025 @Yowster thank you very much for this summary ... it was a tough year and my SO account ended up slighlty in the red (-0.31% before comms, -1.2% with comms).... but I am not deterred going into 2026 as this strategy has a risk:reward profile that I can better manage .... I have been working on improving my knowledge of the put calendar trade strategy so that I can be more proactive with my trades instead of waiting for alerts in the forum ... I will keep in mind the observation that RV's with slightly higher than previous cycles may make good trades ... thanks again to all SO members and looking forward to a prosperous 2026 2 1 Quote
Kim Posted December 30, 2025 Posted December 30, 2025 Thank you @Yowster for an excellent summary as usual. Few comments. First, we are definitely working hard to make adjustments to our strategies in order to get back to the previous years performance. Specifically: We will do more calendars even if the RV is slightly elevated, as long as there is a pattern of rising calendar RV. We will be using our newly introduced strategy Pre-earnings Iron Condors, but use a better risk management to prevent larger losses. We will be more selective with Hedged ratios and BWBs to limit the losses. Straddles/Strangles: we will likely try to cut the loss before it reaches double digits. As a general note, no strategy can work 100% of the time. Our model portfolio was still up in 2025, just not as much as in the previous years. The market conditions have been very different in 2025, and it's unrealistic to expect any strategy to work all the time. That said, our other strategies performed very well. If you invested an equal amount of money between all our services, your portfolio would be up around 37%. As always, diversification is the key. I don't know what the future holds, but I am confident that the strategies we use are solid and are based on probabilities. Sometimes it just takes more time for the probabilities to play out. I'm also aware that some people join based on 13 years of triple digit returns but cancel after a few sideways months. This is similar to someone who entered the market at the beginning of Covid in 2020, based on ~10% yearly historical returns, and exited a few months later after 30% drawdown, just to watch the markets more than doubling in the next 5 years. 3 1 Quote
herzzuhaus Posted January 7 Posted January 7 I’ve learned a lot from SO and appreciate the transparency and consistency behind the process. One point I’d add to the discussion is that RV works well as an analytical framework, but in execution we are trading IV. Many calendar and DD trades implicitly rely on front-month IV still building into earnings while back-month IV remains relatively cheaper. In 2025, I think that earnings IV in many underlyings was already priced in much earlier than historical data suggests, leaving little room for further front-IV expansion. In that setup, the structural edge of calendars and DDs is reduced even if RV metrics still screen attractively. 1 Quote
Kim Posted January 7 Posted January 7 36 minutes ago, herzzuhaus said: I’ve learned a lot from SO and appreciate the transparency and consistency behind the process. One point I’d add to the discussion is that RV works well as an analytical framework, but in execution we are trading IV. Many calendar and DD trades implicitly rely on front-month IV still building into earnings while back-month IV remains relatively cheaper. In 2025, I think that earnings IV in many underlyings was already priced in much earlier than historical data suggests, leaving little room for further front-IV expansion. In that setup, the structural edge of calendars and DDs is reduced even if RV metrics still screen attractively. I'm not sure I would agree with your assessment regarding calendars. As @Yowster mentioned, number of calendars was much lower than most prior years as this year saw the calendars for many stocks having their calendar RV significantly higher than prior cycles, and therefore trades were not opened in these cases. So the issue was not the IV, but mostly number of trades when it comes to calendars. While the average return was lower than previous years, it was still close to double digits which is very respectful. And the lesson is that we will be doing more calendars in 2026 as long as there is a pattern of rising calendar RV heading into T-0. Many stocks show a tendency for calendar RV to rise regardless of current levels, but we didn’t open trades on these stocks if the current RV was elevated. While we wouldn’t want to enter if calendar RV was sky high, hindsight showed that opening trades when RV was slightly to moderately elevated wound up being winners. Quote
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