CML TradeMachine Trade Ideas

[NikTam]

1 hour ago, Mark100 said:

Hi,

I am considering purchasing the CML TradeMachine software and am wondering if anyone who has been using it for a while would be willing to post their results.

Thanks very much,

Mark

I would also consider subscribing to Return Matrix/Return Scanner that @Djtux offers at a discount to SO members.  I like using both to prospect for high probability PE momentum trades.

Edited March 14, 2018 by NikTam

[greenspan76]

I entered a pre-earnings call on ORCL earlier today: Mar23 $53 call for $1.13.  This was from a CML blog post in September, with setup of weekly 50 delta call 3/0, SL/LG 40%. Today is 3 trading days before earnings and with a choice of ~52 or ~48 delta at the time I opened, I chose the 48 delta.

 

@Mark100 I've posted my results a few times somewhere earlier in this thread, so if you search back through, the last breakdown might be useful info. As of right now, I've made 174 trades since mid-June 2017 with an average gain of 6.4% while trying to follow the setup close to the backtested result. However, all of this was an experiment to see if it was worth a subscription, so I've only followed trades that have been posted on the CML News blog (http://www.cmlviz.com/cmld3b/lite.php?app=news&referral=menu) or that other members have posted (where I can check the details of the trade myself). I'm planning to complete 1 year without a subscription and analyze the results, but the way its looking so far, I almost feel bad about not paying for a subscription since I've made quite a bit of money off the trades

[IgorK]

16 minutes ago, greenspan76 said:

I entered a pre-earnings call on ORCL earlier today: Mar23 $53 call for $1.13.  This was from a CML blog post in September, with setup of weekly 50 delta call 3/0, SL/LG 40%. Today is 3 trading days before earnings and with a choice of ~52 or ~48 delta at the time I opened, I chose the 48 delta.

 

I am in 53 straddle so can't open 53 call...

Alsoin NKE call...  And they both go in the same direction. I need ORCL go down and NKE up

Edited March 14, 2018 by IgorK

[NikTam]

16 minutes ago, greenspan76 said:

I entered a pre-earnings call on ORCL earlier today: Mar23 $53 call for $1.13.  This was from a CML blog post in September, with setup of weekly 50 delta call 3/0, SL/LG 40%. Today is 3 trading days before earnings and with a choice of ~52 or ~48 delta at the time I opened, I chose the 48 delta.

 

Entered 53 call for 1.08   Thanks for heads up.  Recent history looks very good.

[zxcv64]

1 minute ago, IgorK said:

I am in 53 straddle so can't open 53 call..

I believe you can. As long as you don't have  a short strangle with a 53 strike.

It just means that you have extra 53 calls.

 

[greenspan76]

5 minutes ago, IgorK said:

I am in 53 straddle so can't open 53 call...

Alsoin NKE call...  And they both go in the same direction. I need ORCL go down and NKE up

 

2 minutes ago, zxcv64 said:

I believe you can. As long as you don't have  a short strangle with a 53 strike.

It just means that you have extra 53 calls.

 

I've adopted an approach of more trades with lower allocations per trade, so I don't have a problem with holding both the call and the straddle (I have the 52.5 straddle). There's no problem with holding both, but obviously if you're concerned about overallocation then you're better off skipping it since there will always be another trade.

[IgorK]

9 minutes ago, zxcv64 said:

I believe you can. As long as you don't have  a short strangle with a 53 strike.

It just means that you have extra 53 calls.

 

Correct. I had to cancel straddle sell order first... Thanks for heads up.. Will see...

    BOT    1    ORCL Mar23'18 53 CALL    1.07   
 

Edited March 14, 2018 by IgorK

[IgorK]

4 minutes ago, greenspan76 said:

 

I've adopted an approach of more trades with lower allocations per trade, so I don't have a problem with holding both the call and the straddle (I have the 52.5 straddle). There's no problem with holding both, but obviously if you're concerned about overallocation then you're better off skipping it since there will always be another trade.

Me too. One CALL and one straddle.

[NikTam]

ORCL not behaving very nicely.  I need to take a closer look....

 

I'm out at .98.  Lost a few bucks.  Will look at again tomorrow.  I've been losing on these PE trades lately and getting a bit gun-shy.

Edited March 14, 2018 by NikTam

[scubaskeeter]

3 minutes ago, NikTam said:

ORCL not behaving very nicely.  I need to take a closer look....

Couple things and I'm in all the trades with you folks. Stock is near 52wk high. There is 33,000 open interest in the MAR16 52.5 call. Personally, I am waiting till Friday to decide but Ophir has identified a good candidate here and barring a brown swan or black pelican, I don't plan to lose much on the trades.

[Mark100]

 

4 hours ago, greenspan76 said:

@Mark100 I've posted my results a few times somewhere earlier in this thread, so if you search back through, the last breakdown might be useful info. As of right now, I've made 174 trades since mid-June 2017 with an average gain of 6.4% while trying to follow the setup close to the backtested result. However, all of this was an experiment to see if it was worth a subscription, so I've only followed trades that have been posted on the CML News blog (http://www.cmlviz.com/cmld3b/lite.php?app=news&referral=menu) or that other members have posted (where I can check the details of the trade myself). I'm planning to complete 1 year without a subscription and analyze the results, but the way its looking so far, I almost feel bad about not paying for a subscription since I've made quite a bit of money off the trades

 

@greenspan76 Thanks for the response. I looked back and found some of your posts and I was wondering how you calculate the return on your trades.

Mark

On 11/6/2017 at 1:25 AM, greenspan76 said:

Just to follow up a bit on this point about my personal results with CML trades. I'm up to 62 total CML trades so far with an average holding period of 12 days and an average gain of 4.1%.  I realized after looking a little closer that if I removed the post-earnings short put spreads and the iron condors, my results were actually pretty good. For pre-earnings calls, I've made 21 trades with an average holding period of 4 days and an average gain of 5%. For straddles (most pre-earnings, but a few post-earnings), I've made 12 trades with an average holding period of 11 days and an average gain of 16.3%. I'm just going to keep going. Have limited time and don't want to hijack the thread, so I'll just try to post aggregate results after 6 months and maybe after a year of trading them.

On 1/11/2018 at 12:30 AM, greenspan76 said:

Overall, I've now made 103 CML-based trades with an average gain of 7.2% and average holding period of 14 days. The post-earnings ICs have been big losers on average (7 trades / -41.8% avg) and the post-earnings Short PS's are now the most consistent (35 trades / +10.2% avg) 

[Mark100]

7 hours ago, zxcv64 said:

I believe there are at least a couple of experienced guys on here who have a good track record with CML. 

Give me another week or so, and when I have completed another 7 trades, I will post my results (currently on 93 CML trades).

 

 

Okay, thanks I appreciate it. I see a lot of trades being talked about but not too much posted about long run results.

 

[greenspan76]

1 hour ago, Mark100 said:

 

@greenspan76 Thanks for the response. I looked back and found some of your posts and I was wondering how you calculate the return on your trades.

Mark

I don't want to discuss the specific dollar amounts I trade, but I have a set dollar amount allocated per trade and open the number of contracts needed to get closest to that dollar amount. If the trade can't be constructed within $100 above or below that set allocation, I either modify the trade (for example, I might trade a higher or lower delta or maybe turn a call into a call spread instead) or I skip it. So, while it might be better to normalize the trades to the exact dollar amount to give a fairer comparison, I ignore this because $100 one way or another isn't going to make a big difference in my trade results. Beyond that, I'm simply taking the dollar gain divided by the capital at risk. And since the trades are all substantially the same dollar amount, I report the totals by taking the cumulative gain on all trades and dividing by the cumulativel capital at risk to get an average gain per trade.

 

Edit: I should probably note that my early results were less promising - if memory serves me, it was around 1.x% avg per trade over the first maybe 30ish trades, but then the results improved and have been relatively consistent since (keeping in mind that these are higher risk/reward, with many trades averaging something like 50% on gains and 38% on losses or something similar)

Edited March 15, 2018 by greenspan76

[Maji]

@greenspan76 thank you for posting your findings. I do not follow this thread on a regular basis, so please pardon my ignorance.

Do you trade mainly the long calls before earnings? If you do, what delta do you trade? Any other entry/exit criteria you follow?

Thank you.

[IgorK]

8 hours ago, NikTam said:

I would also consider subscribing to Return Matrix/Return Scanner that @Djtux offers at a discount to SO members.  I like using both to prospect for high probability PE momentum trades.

These two services should unite

[greenspan76]

6 minutes ago, Maji said:

@greenspan76 thank you for posting your findings. I do not follow this thread on a regular basis, so please pardon my ignorance.

Do you trade mainly the long calls before earnings? If you do, what delta do you trade? Any other entry/exit criteria you follow?

Thank you.

I trade every trade I've come across on the CML blog or posted on this thread by others that looks like a valid result to me, which means for each potential trade, I look at the details of the backtest and decide whether some anomaly is causing the overall results or it looks like a legit trend. Of the 174 trades, I've made 39 post-earnings Short PS, 90 pre-earnings calls, 22 straddles (~15 pre- / ~3 post-earnings / ~4 non-earnings), 15 post-earnings Iron Condors (some short / some long - don't have that breakdown), 6 TTM Squeeze, and 2 that I classified as Other.

 

As far as deltas, entry/exit criteria, etc, I trade whatever the backtests show. In many cases (particularly pre-earnings calls), the backtests will show results for multiple deltas. In that case, I trade 40-delta unless the 50 delta results look better. Most trades have their own stop losses and/or limit gains (typically, but not always 40-50%) and I follow that. I try to follow the CML methodology of waiting to determine stop losses/limit gains until the end of the trading day, but find it hard to stick with that on large gains (particularly when they're approaching 100% gains), so I've closed a lot of trades early. I don't track how many are better holding vs closing earlier, but it seems like holding until end of day would have been better in most cases. I open trades in the last hour unless I don't have time later or I see a dip in price that presents a good entry point (for example, if I'm watching a 50 delta call early in the day and the stock price drops and now I can get it for 20% cheaper. Well, I know I'm going to open it in a couple hours anyway, so I'll usually open a little early). Lastly, I limit to 10 ongoing trades at once and if a trade loses twice in a row, I assume the trend is dead and stop trading it.

[NikTam]

11 hours ago, IgorK said:

These two services should unite

Right!  I use both now.  I also really like the Alerts feature now available on CML Trade machine.

Edited March 15, 2018 by NikTam

[IgorK]

19 hours ago, IgorK said:

Correct. I had to cancel straddle sell order first... Thanks for heads up.. Will see...

    BOT    1    ORCL Mar23'18 53 CALL    1.07   
 

    SLD    1    ORCL Mar23'18 53 CALL    1.09   

Essentially BE after commissions... Too much up and down...

NKE not looking good so far...
 

[scubaskeeter]

I"m out of all ORCL trades. Small profit. Was worried that if it did rally, my 53 straddles would suffer. Might come back for a call tomorrow if lower.

Edited March 15, 2018 by scubaskeeter

[IgorK]

Guys with NKE: are you keeping over weekend?

[greenspan76]

19 minutes ago, IgorK said:

Guys with NKE: are you keeping over weekend?

Unless my trade is up or down 40%, I won't be closing until Mar 21st.

[IgorK]

2 minutes ago, greenspan76 said:

Unless my trade is up or down 40%, I won't be closing until Mar 21st.

I see. You have Apr20 CALL . My is Mar23. Theta will kill it faster.

[NikTam]

23 minutes ago, IgorK said:

Guys with NKE: are you keeping over weekend?

I will be holding.

[rasar]

2 minutes ago, greenspan76 said:

Unless my trade is up or down 40%, I won't be closing until Mar 21st.

For my clarification, the NKE table show T0 as the date for max profit. Wouldn't that be Mar 22 since NKE reports that day after close ?

[greenspan76]

8 minutes ago, rasar said:

For my clarification, the NKE table show T0 as the date for max profit. Wouldn't that be Mar 22 since NKE reports that day after close ?

Yeah, I believe the last day tends to have increased volatility and increase in price, but I'm just following the posted backtest of opening 9 days before and closing 1 day before. I'm not trying to suggest my way is better, or even that it is optimized. However, you make a great point.

Edited March 16, 2018 by greenspan76

[NikTam]

13 minutes ago, IgorK said:

I see. You have Apr20 CALL . My is Mar23. Theta will kill it faster.

I have the Mar 23 also and that is my biggest concern.  

[IgorK]

1 minute ago, NikTam said:

I have the Mar 23 also and that is my biggest concern.  

I though adding another contract to bring price down. But it may end up in more loss as well...

[NikTam]

9 minutes ago, IgorK said:

I though adding another contract to bring price down. But it may end up in more loss as well...

Based on limited experience, I've never found that to be a successful strategy.

[siddharth]

@NikTam

 

how ow do you use djtux charts ? To find candidates or determine when to enter ? And how do you read them 

[NikTam]

23 minutes ago, siddharth310584 said:

@NikTam

 

how ow do you use djtux charts ? To find candidates or determine when to enter ? And how do you read them 

The scanner is pretty self-explanatory.  It screens by median returns in different time frames.  It also screens for confirmed earnings vs unconfirmed and weekly and non weekly symbols.

Return Matrix is a symbol generated grid that shows median returns for long calls and puts, and straddles, for each day leading up to earnings date.  And it's color coded as a "heat map" so you see at a glance if it's interesting.  It's a different approach than CML Trade Machine which shows good, average and poor statistical results in terms of occurrences.  So I think the two complement each other.

@Djtux allowed me a 7 day trial to see what it could do -- that's the best way to find out.  There are other graphs also that we've seen for quite awhile that measure historical RV, IV, etc for straddles and calendars.

[siddharth]

What delta does it use though for the calls ? Or is it a range ?

[zxcv64]

3 minutes ago, siddharth310584 said:

What delta does it use though for the calls ? Or is it a range ?

Forgive me for jumping in, but it allows you to choose whatever delta you want in multiples of 10, so.....you can have deltas like 10, 20, 30....up to 90.

[IgorK]

2 minutes ago, siddharth310584 said:

What delta does it use though for the calls ? Or is it a range ?

 

5 minutes ago, siddharth310584 said:

What delta does it use though for the calls ? Or is it a range ?

@siddharth310584 Here is dedicated thread. You can ask all questions there: 

 

[Djtux]

@siddharth310584,

For the return matrix, you can select the strategy, and for long call or long put, you can select the delta from a list :

If someone makes a screenshot of the return matrix, look at the title, there is all the information you need to know : https://steadyoptions.com/forums/forum/topic/4072-cml-trademachine-trade-ideas/?do=findComment&comment=97282 : you know it's the symbol NKE, testing a 40 delta call over 8 earning cycles (so 2Y history), the backtest was done 2018-03-13 which is T-7 trading days before the earning date which is 2018-03-22 AMC confirmed.

I can move my answer to the volatilityhq.com threads if it's polluting this thread.

 

 

[IgorK]

So any thoughts on NKE?

[NikTam]

1 hour ago, IgorK said:

So any thoughts on NKE?

I am showing big loss because of overall market volatility but will hang on for now.

[zxcv64]

I hold the 68 strike long call in NKE and am sitting at 30% loss. Not too alarmed as that is part and parcel of CML - big wins and big losses.

ORCL was a 45% loss for me - closed today.

 

[Djtux]

6 minutes ago, zxcv64 said:

ORCL was a 45% loss for me - closed today.

I'm looking at 15% loss right now, but because it's only 1 contract, i might play at the casino today and keep it though earnings.

[NikTam]

I am right at 40% loss on the 68.5 NKE call right now.  I will wait for end of day to decide.

Showing some strength on the 1 hour chart.  I'm going to hold on for another day.

Edited March 19, 2018 by NikTam

[NikTam]

PLAY looks interesting.  Will be watching the charts for a good entry next couple of days.  Also looks good on @Djtux Return Matrix.

http://tm.cmlviz.com/index.php?share_key=20180319211718_V5MUuoVtzPcBJ8VK

[Djtux]

2 minutes ago, NikTam said:

PLAY looks interesting.  Will be watching the charts for a good entry next couple of days.  Also looks good on @Djtux Return Matrix.

http://tm.cmlviz.com/index.php?share_key=20180319211718_V5MUuoVtzPcBJ8VK

I'm not even sure what this company is doing.

[NikTam]

5 minutes ago, Djtux said:

I'm not even sure what this company is doing.

Please share your thoughts.  I thought the heat map looked pretty good for Long Call Pre-momentum Earnings strategy.

Edited March 19, 2018 by NikTam

[Djtux]

5 minutes ago, NikTam said:

Please share your thoughts.  I thought the heat map looked pretty good for Long Call Pre-momentum Earnings strategy.

I never looked at that stock before, so i don't know it that well. Also the earning date has not been confirmed.

The return matrix look good indeed, but i'm not sure there is an upward trend right now.

The stock chart doesn't look good after their announcement on Jan 8th : http://ir.daveandbusters.com/news-releases/news-release-details/dave-busters-entertainment-inc-updates-fiscal-2017-guidance.

Seems there are some resistance at 43.5 and we just pierced that today but is it going to be confirmed or will we rebound ? I have no idea.

What do you think ?

I would at least wait until the earnings are confirmed, and monitor where the trend is going, and keep the allocation small. Personally i might skip it altogether.

[NikTam]

 

@Djtux These are all good points and I may skip it as well.  I will be looking for a major reversal this week or I will not partake.  In general, I much prefer stocks that are in an uptrend for the PE Momentum trades.  PLAY has a 7-1 win-loss over past two years, which is unusual and the only reason I'm considering.

 

[greenspan76]

I have family visiting and will have limited availability for trading the next 2 weeks (until yesterday, I was only expecting next week to be effected), so closed ORCL right after the open and tried to close MU and NKE (originally, the plan was Thursday unless 40%+ gains). Didn't get a fill on NKE, though, so I'll have to try to close it on the mobile app tomorrow (or might even wait until Thursday now) With that said: 

 

Closed ORCL call for 14.1% loss (Mar23 53 Call. In 1.13. Out 0.99).

 

Closed MU call for gain of 6.5% (Mar23 61 Call. In 2.03. Out 2.18).

Edited March 20, 2018 by greenspan76

[IgorK]

Missed NKE spike at the open. Now it's down again

[NikTam]

2 minutes ago, IgorK said:

Missed NKE spike at the open. Now it's down again

It did gap up, though; on decent volume.  I'm staying positive.

[rasar]

1 hour ago, IgorK said:

Missed NKE spike at the open. Now it's down again

It's back up to the opening level....

[NikTam]

Regarding NKE which reports AMC on Thursday, I wonder if we should be concerned about Fed meeting tomorrow?  As we’ve seen, these general market downdrafts often affect our positions.  

[IgorK]

24 minutes ago, NikTam said:

Regarding NKE which reports AMC on Thursday, I wonder if we should be concerned about Fed meeting tomorrow?  As we’ve seen, these general market downdrafts often affect our positions.  

This and Theta.