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  3. Rumple4skin

    ThinkOrSwim Platform

    I'm a newbie and I'm learning to paper trade using the TOS paper trading platform. I'm trying to put some of the more complex earnings trade into their trading platform and having a hard time with it. Can anyone recommend some resources for helping learn the TOS system? I generally like the platform and it's fairly intuitive but I need a little bit of coaching on the more complex strategies. Also, did anyone else start with TOS paper trading and then go LIVE and see if there was a difference in execution prices? I'm wondering if I'm getting "real life" fills on the paper trading platform or if I'm in for a rude awakening when I move to LIVE trading. Thank you.
  4. Yesterday
  5. I'm only partially paying attention, not able to get in all trades, forgetting to "follow" and missing adjustments etc so I know where to start on improving my performance, but I was hoping to hear some honest feedback on how other members are doing in real-world. THIS IS IN NO WAY A DIG ON THE TRADES but I think it's a beneficial, positive discussion that could lead to better results for everyone. Most of you are far superior traders to me, but I bet I'm not the only one here with other life distractions, etc. Plus, this market, I mean World is kinda insane right now...So.. how is 2020 going for everyone?
  6. RapperT

    Welcome to Steady Futures

    You’re not missing anything. Important piece is to just get as close as you can to the signaled delta. dont worry about matching our spreads exactly. I would guess in many cases the specific strikes will vary from member to member depending on when you take the trade during the day.
  7. Markuse

    Welcome to Steady Futures

    I took HG Aug 2.55/2.6 Bull Call NYMEX with a delta of 0.097. Any preferences between the two spreads here or anything I am missing?
  8. Currency investing is essentially betting that one country’s economy will be stronger than another’s, and when done right, it’s a very effective strategy. If you are considering currency investments for the first time, here are a few important tips to help you improve your strategy and avoid any big losses. Consider Using A Broker The majority of trading happens on a day-by-day basis, which means that your success depends on your knowledge of different industries and assets. Currency trading or Forex trading is no different and investors are able to trade currencies 24 hours a day on weekdays, so there is the potential for some big profits. However, you will only make those big profits if you have an in-depth understanding of the global market, which many people do not. Even if you have experience in other investment strategies, that doesn’t necessarily mean that you have the knowledge to successfully trade currencies, so you should consider a broker. Unless you are completely confident that you know what you are doing, you should find a Forex broker and have them handle the day-to-day trades for you. When searching for a broker, make sure that you use a reliable one that is authorized. In the US, all reliable Forex brokers should be a member of the FINRA (Financial Industry Regulatory Authority) and they should also be registered with the Securities and Exchange Commission. There are so many brokers out there that claim to be legitimate but, unless they have these credentials, you shouldn’t hand your money over to them. Stick To Major Currencies New investors often make the mistake of investing in more volatile currencies because there is potential for a higher return. Argentina, for example, used to be a very popular trading currency but when an international crisis shut down the banking system in the 2000s, a lot of people lost their money. Although these volatile currencies may seem like an attractive prospect, the risk is not worth it and you are far more likely to lose big money. It’s much safer to stick to major currencies in countries that have a stable government. Political turmoil, international relations issues, and financial problems will all devalue a currency very quickly, so steer clear of any countries that are likely to experience any of these things. Instead, look at the biggest global economies that are seeing steady growth and are unlikely to experience any major financial issues in the near future. Although the returns on these currencies will be smaller, the risk is also far lower. Invest For The Long Term If you are looking for an investment opportunity with a quick turnaround, currency is not the best choice. In the short term, currency investments are one of the most volatile investment options. Things like inflation, GDP, unstable governments, corruption, employment rates, and nationalization can all have a big impact on the value of a currency and they tend to fluctuate a lot. If you want to make successful short term currency trades, you need to have an in-depth knowledge of international politics and economics, as well as an understanding of local factors in the countries that you are invested in. Your broker will be able to help with this to some extent but they are more likely to be focused on long term investments. If you are willing to invest for the long term and you set realistic expectations about your investments, the risk is reduced in a big way and you stand a much better chance of seeing any meaningful returns. Consider An ETF Or Mutual Fund ETFs and mutual funds are another effective way to reduce the risks involved with currency investing. ETFs or exchange traded funds group together a collection of different investments and trade on a daily basis, so their rates fluctuate throughout the day. You can buy and sell an ETF during the trading day, just like you would with stocks, but the main benefit is that all of the research is done on your behalf. You simply need to decide when to buy and sell your ETF and you can leave all of the specific currency trades to the experts. A mutual fund adds your investment to a pool with a lot of other investors and makes various trades using that pool, with each investor taking their share of the profits. If you invest in mutual funds or an ETF, you can spread the risk and reduce the chance of making a loss in a big way. You can also let somebody else with more knowledge and expertise handle all of the hard work for you, so it’s a great option if you are new to currency investing. Be Careful With Leverage Currency Investments Many companies offer leverage currency investments, which essentially means that you borrow from your Forex broker to make your investment. This does allow you to make larger investments but, in most cases, it should be avoided. However, even though this strategy can amplify your profits in a big way, it can also amplify your losses. When trading in something like currency, which can be very volatile, this is a huge risk. If you can afford to absorb the losses and you are willing to take the risk, then you may consider this strategy. However, if you are not prepared to absorb large losses and you want a low risk, low reward currency investment, you are much better off going with a mutual fund or ETF, or investing directly through a Forex broker. Currency investments are a popular way for investors to expand their portfolio and when done right, they can be very effective. However, successful currency investing requires a good knowledge of global economies and international relations, and short term trading can be very risky. But if you hire a reliable broker and invest for the long term, you should see some meaningful returns. This is a contributed post. Related articles 5 Ways To Identify Fake Forex Broker Reviews 7 Ways To Avoid Forex Scams GBP/USD: If Boris Johnson Becomes PM, Volatility Will Rise BTC/USD Struggles To Maintain Newly Conquered Territory 4 Patterns For Forex Profitability Tales Of How Big Trades Went Wrong Eight Mistakes Every Forex Trader Should Avoid
  9. RapperT

    Welcome to Steady Futures

    Was a typo in the call spread, I fixed it. 2.57/2.62 there are two HG confirmations today as we mistakenly opened a new put spread and then closed before opening the appropriate call spread.
  10. AustinB

    Welcome to Steady Futures

    Quick question on the HG trade this week. The post on the weekly trades topic suggests a 2.57/2.67 bull call spread, but the trade confirmation screenshot shows buy to open a 2.53/2.57 bear put spread. Won't a tighter spread than 2.57/2.67 be needed to target the 0.097 50k delta? Thanks.
  11. RapperT

    Welcome to Steady Futures

    Last ZN position expired
  12. Why was there a position opened on ZN but no position closed? Isn’t this strategy stop and reverse?
  13. May jobs report: The US unemployment rate unexpectedly FALLS to 13.3% (vs. expected rise to 20%). Wow.
  14. Last week
  15. Tamilselvan Seetharaman

    Using ORATS in Anchor Testing

    Very good article. Thanks! I had a question about backtesting of long Put roll -- is there any backtesting software that can do this well ? From the above article ORATS does not seem to do it, I am trying out CMLviz TradeMachine - which does not seem to do it. do you know of any backtesting software that can do this well ? If there is none, then how do you do it ? manually - by hand ? Thanks, Tamil
  16. Rado

    Why You Should Not Ignore Negative Gamma

    Working to come up to speed ... 1) Would you consider something like selling a vertical put spread gamma negative? Or is that then direction dependent, i.e. you're "happy" (friend) if the underlying goes up, and "sad" (enemy) if it goes down. So are you referring to when you don't want the underlying to change at all, or in this bull put spread case also? 2) Is an iron condor (initial setup) always vega negative -- because the strikes closer to the money, that one sells, grow faster with a volatility increase than the strikes that one buys (further from the money)?
  17. One of the things I like to check out occasionally is the top traders unplugged site/podcast. Both are great. The host is an employee of Dunn Capital (one of the oldest systematic trend shops) and they have great guests. One of the things they publish is a trend barometer. You can find it on the top traders unplugged website. To @RapperT 's point it was a really tough month for trend following. One thing that we are doing is adding more contracts over time which should help us weather these types of months better but when the market whipsaws back and forth like it did you're going to take losses. Over the long-term though it works out.
  18. RapperT

    Welcome to Steady Futures

    Howdy Folks: Obviously not a great month for the system. I wanted to post a few thoughts and I'm sure @Jjapp will chime in as well. We were getting whipsawed like crazy all month long. At one point i think the ES signal changed 4 weeks in a row. This is really unusual, especially for ES. There weren't really any strong trends for the month This is also evident in the trade volume for the month as we closed 28 trades. Avg for the month up until May was 20 trades In our experience, months like this will be pretty rare. We expect returns to be lumpy as we've said over and over, but we dont expect having snapbacks in basically every contract throughout the month to happen very frequently at all. That said, like we mentioned in the original post, it will eventually happen. We are still handily beating our benchmark, Socgen Trend Index which is up .79% YTD We understand we had some new members over the last month or two, this is just some unlucky timing for you. But this highlights the need to take every trade and stick with it. The typical return stream will be small losses or gains most months followed by the occasional out sized winning period. If you're not in every trade every month, your return stream will different (and worse over the long run). We are still open to having a conference call with members to discuss the system in more detail and take some questions. If there is enough interest we will set this up Happy Trading, here's to a better June!
  19. Guest

    The Gut Strangle Strategy

    Any thoughts on selling a DITM guts strangle and using the credit to buy an ATM straddle, thereby creating a iron butterfly for a credit and which is also long?
  20. Yes i will add that to the todo list.
  21. Hi @Djtux I am sure you are working on a lot more important stuff than this but any chance we could get T-15, T-10, T-5 put calendar median results added to the return scanner? I am finding it very helpful for the straddles. Thank you!
  22. A quick question for those who have non-USD base currency accounts, do you normally hedge your SO holdings? If so what methods are you using? I've been by account balance drop consistently despite a reasonable result from trades. Doing some digging I noticed that the AUD (my base currency) has appreciated ~5% over the past month/~11% since I started back with SO which -at ~2/3 committed capital- would account for the decline in value. Given that currencies are relatively stable over time -AUDUSD has just returned to pre crisis levels- do you all try to hedge the impact or just view it as an occasional source of excess return/loss?
  23. I am surprised the "relief rally" has lasted this long and taken the S&P 500 as high as it currently is. One would think it cannot sustain this for very much longer. Feels like a "house of cards" adding too many floors while the Covid-19 virus is chewing away at the foundation. Look out below.
  24. Bull3t007

    Can you double your account every six months?

    "But after 10 years as...." Like a F3 driver saying that driving F1 is easy because he had 10 years experience in F3 and he can control an F1 car 😛
  25. Jjapp

    KC (Coffee) Trade Discussions

    Sorry...looking at the equivalent trade today (0.975/0.95) the delta I have on the long is 0.484 and on the short is .408. This gives a net exposure of ~-0.08. Going out further on the short would give a too large delta so I defaulted to taking less risk rather than more.
  26. If IT'S NOT THAT HARD, why 90% of traders fail?
  27. Markuse

    KC (Coffee) Trade Discussions

    Any recommendations, John?
  28. Guest

    Can you double your account every six months?

    Hi! Thanks for the interesting educational stuff you throw at us and there's a lot of truth in the latin saying "per aspera ad astera" or "the path to success is hard" or "thete's no free lunch out there" ... BUT after 10 years as a value-oriented stock picker who's just picked up options trading a few months ago I must say IT'S NOT THAT HARD you just need "a good sets of rules you trade by and stick with it" and "limit your trade size/risk" ... and guys, don't forget: IT'S WALL STREET NOT LAS VEGAS
  29. What I began to realize over the years was that the risk I was taking with iron condors was excessive, so the thought of selling a “naked” strangle was unimaginable. This risk was due to ridiculously large position size, or leverage, and over time I began to understand this reality better. An iron condor is simply a short strangle with long options that are further out of the money than the short options. Some traders refer to the long options as “wings”. Because an iron condor creates a maximum potential loss equivalent to the width of the spread, traders make the mistake of often trading their account up to or near the maximum number of contracts that would wipe out most of their account if that max loss occurred, which during periods of low market volatility may be as minor as a 10-15% drop in the market.The average intra-year drawdown for the S&P 500 has been about 14% since 1980, so this is something that occurs almost every year. This is of course why you hear so many stories of retail traders and credit spread/iron condor newsletters blowing up. As is almost always the case, the risk isn’t really the strategy…but instead the position size of the strategy! There’s no strategy so good that enough leverage can’t make it a blow up waiting to happen. Due to the nature of out of the money option selling, the negatively skewed return stream can take a while to materialize when there are long periods of relatively calm market conditions. Today, I think of a strangle as a cash secured put along with an out of the money short call. Thinking about the trade this way transforms a short strangle from seemingly risky into a rather conservative trade, due to the position sizing rule. For example, with SPX currently trading at about $3,000, a strangle would be sized at about 1 contract per $300,000. Compare this to selling 10-point wide put and call credit spreads to create an iron condor, and many newsletters might suggest that you sell something like 275 contracts per $300,000 of capital! Think about that for a moment…technically the iron condor has “defined risk” of $275,000 (ignoring the credit received), while the strangle has “undefined” risk because the short call is naked and prices can theoretically rise forever. Yet the risk is immensely different for the two trades due to the number of contracts involved. The strangle has a positive expected return and will very likely survive and succeed over the long-term due to the well documented Volatility Risk Premium (VRP), while the iron condor will cause an eventual blowup. When someone says they prefer iron condors over strangles because the risk is “defined” with an iron condor, they probably haven’t spent a lot of time thinking about position sizing. This should be the biggest lesson from this article…risk is defined by your position size to a much greater degree than it is by the strategy. Yet it’s a topic that is not well understood or appreciated by most traders. I think about an iron condor similar to how I’d think about owning 100 shares of a stock and then buying a protective put. A strangle is like owning just those 100 shares, while an iron condor is like owning those 100 shares along with an out of the money protective put. That put will reduce your downside during extreme selloffs that are greater than the market already baked into prices, but at a substantial cost over the long run (again, due to the VRP). To illustrate this, I backtested SPY strangles and iron condors using the ORATS wheel. Selling 30 delta strangles on SPY since 2007 has produced an average annual return of 5.34% (volatility of 8.36%, Sharpe Ratio 0.64), while a 30 delta iron condor with wings set at 20 delta returned only 0.15% (volatility of 3.08%, Sharpe Ratio of 0.05). I ran the test a few times just to make sure I was getting consistent results. The additional transaction costs and performance drag of the long options is so significant that almost the entire return generated from the short options disappears. Conclusion On your journey as an options trader you’ll hear a lot of conventional wisdom repeated over and over that simply isn’t true or provides incomplete information. One of those myths is how selling strangles is risky and instead a trader should sell an iron condor. This statement tells us nothing about position sizing. If you read this article and are still resisting the information I’m sharing, ask yourself this question: Is the reason you still want to use an iron condor over a strangle due to how you might look at the expected return of the strangle as I’ve laid it out and feel a little underwhelmed? Perhaps this article is also what you need to hear instead of what you want to hear, because I know I was in that camp at one time. You might consider that the 5% return of the SPY strangle since 2007 is similar to the long-term global equity risk premium, which serves as the benchmark for virtually everything since so few investments have been proven to be able to reliably exceed it over the long term.Until someone shows you an independently audited decade plus long track record of a fund or newsletter selling iron condors with the “X% per month” average returns that are often fantasized about and marketed to new traders, use the position sizing algorithm presented in this article instead as your baseline. Think in terms of notional risk instead of margin requirements, and you’ll substantially reduce the risk of an unrecoverable negative surprise on your trading journey. Jesse Blom is a licensed investment advisor and Vice President of Lorintine Capital, LP. He provides investment advice to clients all over the United States and around the world. Jesse has been in financial services since 2008 and is a CERTIFIED FINANCIAL PLANNER™ professional. Working with a CFP® professional represents the highest standard of financial planning advice. Jesse has a Bachelor of Science in Finance from Oral Roberts University. Jesse manages the Steady Momentum service, and regularly incorporates options into client portfolios. Related articles Selling Naked Strangles: The Math Selling Short Strangles And Straddles - Does It Work? Selling Options Premium: Myths Vs. Reality Karen The Supertrader: Myth Or Reality? Karen Supertrader: Too Good To Be True? How Victor Niederhoffer Blew Up - Twice The Spectacular Fall Of LJM Preservation And Growth James Cordier: Another Options Selling Firm Goes Bust Trading An Iron Condor: The Basics The Hidden Dangers Of Iron Condors
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