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A little while back when I mentioned my trading stats on these CML-based trades, there were several put credit spreads included. Some of the early trades I made were as much as $4 risk for $1 potential gain, but most were closer to $1-$2 risk for each $1 of potential gain. Even the better risk/reward setups didn't seem to do well in real trading. The way I have them compiled, I just don't have time to dig deeper than the summary that my spreadsheet is automatically showing me already. But in case it is of interest: I've traded 14 CML-based post-earnings put credit spreads with 8 winners and 6 losers (backtested results were 10 winners/2 losers or better on all trades), an average loss of 4.8% and avg holding period of 21 days. On the other hand, I've traded 21 pre-earnings calls with 14 winners and 7 losers, an average gain of 9.6% and avg holding period of 5 days. I've also had really poor results with post-earnings Iron Condors (4 / -30.3% / 23) and really good results with both pre- and post-earnings straddles (11 / +18.3% / 12). I'm somewhat inclined at this point to avoid the put credit spreads, but I'm sticking with them at least until the end of the year to get a better idea.

Yes they are higher than the "official" prices but, I very often do not take those prices seriously. Just as often as not, They will give a price like ."90, .95,..but don't chase it over $1.00". Then, the second you put it on your screen, all you see is $1.15/ $1.40. Then, the next day, it is $1.20 or $1.25 on the bid, with a few actual trades at $1.35. This is such a common scenario. So, you will never buy these spreads anywhere near the official. I just use it as a guide, and then observe market behavior for this particular trade. Everytime I buy these at $1.15 or $1.20, for example, I am usually able to sell a few, within a day or 2, for like $1.35 and, at the end of the trade, with 1-2 days before earnings, I typically get out, along with most people here, for as high as $1.75 I wouldn't put too much attention on the official price in many of these trades, because, not only is there no chance to ever buy near that price anymore but, even buying .20 cents higher, will still provide excellent profits. When this trade came out, the market was instantly bid around .15-.20 cents higher, than the official alert stated only a few minutes ago. And I tried to get in as close to what the current bid was, and whenever I was able to, the trades always led to profits. This one was instantly .15 -.20 cents above the official price,and it never went back down below the "real" prices. Yes, it is another issue completely, if you get into a $155 strike and over the next week, the stock drops,(or rises) way outside of the "expected " move. Even in those cases, the spreads very often hold up well, even beyond a large move away from the original price. I'm not saying that this is the ONLY way "official" trades should be dealt with. There are many times when after an initial surge, it actually does pull back in the next few days. But, you just have to get used to doing them many times, and eventually,you will get better at knowing which way to deal with these.

Some options that appear, at first glance,to be very illiquid (crazy bid/ask), upon further examination, and testing, on your own, with 1 lot orders, end up being very easy markets to consistently get good fills in. Then there are others, that appear to be illiquid,and really are. Don't alway's immediately assume that something is illiquid because, at first glance, you are seeing crazy wide bid/asks. There are so many pre earnings calandars, that we have done here, for example, where the spread was like $1.10/$2.30, and then you bid $1.15 and are instantly filled. You have to do further examination, with 1 lot orders to see which are the good ones. A good starting point, obviously, would be if the underlying is very liquid.

@NikTamAll these trades are selling 30 delta puts and buying 10 delta puts, and they have great win-loss percentages over the last few years. But..... they are all quite bad from a risk/reward perspective with many of the trade iterations showing losses of 6x the credit received on a big gap downward. So, if you were to have one big loss due to a big market drop it would take many winning trades to make up for one losing trade. Selling low delta credit spreads does look enticing because of the high win-loss percentage, but you just have to experience on big loser on a big gap downward to realize that these great win-loss percentages don't matter so much when you have a huge loss and it will take many winning trade to make up for that one loss. I experienced this first hand many years ago when I first started trading options, and I learned the risk vs reward lesson the hard way. IMO, when selling credit spreads, better to do so with a better risk/reward setup even if it means having more losses. Remember the SO RIC earnings trades of last year with a risk/reward setup similar, but not quite a bad as these? There were more winning trades than losing trades, but one or two big losers dwarfed all the smaller% winning trades and made the sum of these trades a big loser.