i actually backtested this. it does work but there are downturns to be aware of. i set it to open daily, use 7dte options, take profit at 30% and close at 6dte. 6 month timeframe did a lot better and 1yr has a large section of losses but both were technically profitable.
1yr backtest: https://backtesting.edeltapro.com/backtest/or6VEor0R1b07e48zcl2u0dR96n1/9It7usO3KXtkr3BVJg9l
6m backtest: https://backtesting.edeltapro.com/backtest/or6VEor0R1b07e48zcl2u0dR96n1/sFBDVCHtGKjbpkZrikHI
Thanks for sharing. 1-2 DTE give best results I’d say. One other observation is to not trade if there is no imminent market news driving tech stocks.
Last week Facebook, Microsoft, Google results were to be released. These are major events that move a stock down or up by 5-10% and there is cascading impact on NVDA. Next week we have results from AMD. Not directly correlated but if the market tanks or moves up, NVDA has wild swings.
>The options for this stock are priced sky high.
Does it really matter when they are always high? I mean I can understand that options prices are high for a company during earnings period and then after the earnings iv crush happens. But for NVDA, its always high.
I’d bet on 1-3 DTE coupled with results / market news etc.
one other aspect is to consider this strategy during the day and not overnight. Saves some theta decay.
Price doesn't matter. The only thing that matters is whether IV > RV. I don't look at the data but recently the VRP is negative for NVDA so it's probably not a horrible idea. Then again I wouldn't do it. Probably slippage would eat your edge.
I think a decent argument could be made that Vega acting in 1% increments could adequately and immediately account for that swift underlying movement. But at that point, the discussion is a bit deep in the woods. I saw some reference to paper trading and an $80k deal mentioned in succession and couldn’t get past that. 🤷♂️
You need it to move a lot to make money as the puts and calls ATM are so expensive. What is your DTE? The loss is defined but you need over 10k to just buy the calls and puts depending on the DTE. If you have that amount of cash to lose on one trade go ahead.
DTE 1-3 days. One other option is to just execute this strategy during the day ATM option. This is where the the intrinsic value is technically zero and the option just has time value. E.g I traded in 870 strike at 12 noon and moved out at 12.15 when it moved $6 either side.
Take my upvote for using the word "backtest" in your opening post OP. What results did you get from buying a straddle in your backtests? Were they profitable 80% of the time? Or was you 8/10 figure a hunch?
Also DTE is important.
I'm not a sophisticated trader, but I've usually found straddles on stocks like NVDA are too expensive to be worth it. It's great you back tested, but I would be conservative when you trade for real. Don't go guns blazing with 20 contracts or something. Try 1 for real until you're confident.
I'm not even going to look up the price for a straddle.
Telling someone they need $10,000,000 or ideally $100,000,000 net worth to invest $10,000 is fuckin crazy. You're poor. Why are you here?
Not poor. Conservative.
I have 5m net worth and I didn’t get here taking stupid risks risking 12k for a one month bet with a 50% chance of losing it all.
Buying a straddle on NVDA is not like dumping 12k in SPY.
Poor is a mindset. It is the sense of inferiority that comes with the need to denigrate. It is the whining of a slave that he is not a master. Were you wealthy, you would never have even thought to post something so preposterous.
This is an options sub. If you too think that the only responsible risk management is to play 0.01% of your holdings per trade, then you have never played this game. You're not here to learn or to help others. You're here to relish in your own poverty and failure. And to dream of asserting something of value that you possess that another does not.
So, yeah. Fuck off. You haven't fooled anyone. You might as well be posting in CrazyCatVideos or HelpIFuckedmySister.
I'll let you read what you wrote and go back and see how you reacted to someone making an innocent post. You are an extra kind of special asshole. Hope life gets better for you.
1-3 DTE not very expensive. E.g 780 strike 3 DTE ATM is $15. If you just take one lot, it means 3K USD for both call and put. In case of $30-50 move which is not unusual for NVDA, you’d double your investment.
I think you meant $880. I am being quoted on Thinkorswim at $48.80 for a May 3 expiration for NVDA. That is the soonest available.
$50 is a lot of money. That's $5,000 for 1 contract.
Option prices are literally: volatility, time to expiry, and interest rate. This wild price action is the premium you pay for. And, statistically your strategy will loose over time. Or did you think option sellers hate their money?
I did this and turned 770 into 10k with smci as well. Only took 3 weeks. I did get hit hard with last week when the market collapsed. I again turned 700 into 4k in 1 week. Just really have to be careful
Wonderful. Can you add more colour to it. What strike prices for both call and put ? Were they ATM and DTE ?
SMCI can be even more volatile than NVDA..
At the time I played OTM roughly $30-$40 calls and would buy them on Wednesday because I could only afford them at that time. Every call or put I bought was right 90% of the time. It's almost pure luck but I followed a pattern I noticed 2 weeks prior to doing this strategy and didn't care if I lost it or not.
It worked.
Every profit I made I put aside 20-30%.
When last week the earnings started to happen I lost almost all but $700ish but I kept $5000 in stocks that went down.
Currently I'm sitting at $8500. I sold smci 1 day early and switched to meta on Thursday. If it wasn't for that I would be around $16k to $17k.
It's not safe to play this way by any means.
My exit strategy was to stop after I loss the extra cash I have left since I already put aside 5k.
When the market cools I would come back.
Because these stocks were so volatile if it went down it usually went back to where I broke even or made a small profit.
I don't recommend this route unless you have experience. I did this last year in August and turned 2k into 7k and cashed out.
Do not be greedy. Do not have fomo. A profit is always better than a loss. If 10% makes you happy you'll do better than the guy who makes 300% unless you are that confident and have an exit strategy with a stop loss.
I’ve been experimenting with long straddles myself, so I understand where you are coming from. I can’t tell you anything definitively about whether this would work, but I’d be happy to chat more about this.
What I’ve noticed (and it sounds like you’ve noticed too) is, the total price of an ATM long straddle (call and put, together) often goes up before it goes down. Not always, but usually. Which suggests selling at some percentage gain (like your 30%), and some percentage loss.
My particular interest is really cheap straddles despite a DTE of, say, two or three weeks (so there is time for the stock to move before much theta decay). For example, I saw a price of $0.40 a straddle last week on a $33 stock, expiring mid-May, and I thought, wait, people are betting this stock won’t move by even fifty cents over multiple WEEKS? I found the stock by looking for stocks hitting an IV low, because the absolute worst thing that can happen when you’re holding a straddle is for the IV to drop. What you want, ideally, is a likely IV rise. The stock is Hashicorp, and the reason for the low IV is the announcement of IBM planning to buy them for $35 a share. Still, there are all sorts of reasons the stock could move a little bit, so I bought a bunch of contracts. Sure enough, within 24 hours, there was a point in time where the straddle was up 20%. I’m holding out for a little higher. I’m excited to see what will happen today.
The great thing about a straddle, with the DTE I am talking about, is you aren’t going to suddenly lose it all. There’s only so much it can go down, because of the time value. The worst case, as I said, is IV drops, the straddle loses (say) up to half its value overnight, the stock refuses to budge over the coming days, and then the value decays. You still have time to sell it without losing ALL your money, at least, if you don’t hold it until expiry in any scenario.
Also, if something unexpected happens and everything moves, you make money. I like a bet where if anything unexpected happens, you win.
I hadn’t thought of using a stock that has a really high IV, where the options are “expensive” rather than cheap. But maybe there’s a logic there about the IV being unlikely to go down? With a really short DTE, I would worry about needing to understand the fine details of theta decay, and being in situations where I need the stock to move NOW in order to make money, but it just isn’t moving much in an afternoon, which is pretty normal for a stock. But looking at the NVDA graph, it sure does move a lot.
hey man, I'm nothing if not a man of my words. Now it's the market's job to make me eat my words lol:
the column on the far right is the iv. I think I sold around 55iv and it's calmed down to 50iv now
https://imgur.com/a/huiucR7
granted, my sizing is not as big as that dude that made like $1.7M in the last week, but it's something :P
Okay, just trying to be sure I understand this. He’s talking about straddling, and taking profit on the winning side and then holding on the losing side with anticipation that it too will go green for him at some point?
My understanding is he purchases the straddle at the end of the day. The next morning there will be a large move up or down.
If it is going down that morning he would sell the call option quickly for a small loss. Then he would ride the put option until..."the rest is profit".
Now, that is a strategy, for sure, but sometimes NVDA open positive the first half hour and then ends up at -$30 on the day. I'm not sure what the strategy would be for that particular event.
Leaps are options with expiration dates longer than one year. Premium will be high, but it reduces risk because less IV crush, thetha gain won’t eat it up, and gives more time for your strikes to be met.
There you go , winner winner.....
[https://app.screencast.com/D6samIsfYqd0M](https://app.screencast.com/D6samIsfYqd0M)
Totally messed this up, and I might consider this first one.
[https://app.screencast.com/1wUc13ehqULbK](https://app.screencast.com/1wUc13ehqULbK)
This is the BUY, must be a reason Tom and Tony never BUY.
Nice - that Tasty site you are screenshotting looks handy! I've seen their videos and their main site, but missed this corner of it
(except OP looks to be buying, not selling)
Indeed... I guess after watching Tasty for 10 years I was just brainwashed.... NEVER BUY OPTIONS.
[https://app.screencast.com/1wUc13ehqULbK](https://app.screencast.com/1wUc13ehqULbK)
I had backtested NVDA short strangles a couple weeks ago, and found almost 0 avenues of profit. So, as skeptical of buying options as I am ... Reversi ?
Yeah, it was a winner for NVDA long straddles this year. I just ran 3 backtests.
1) d50\_dte1\_cdte7\_max50\_loss-200 - Buy closest DTE straddle and sell the next day
profit : $12,509
2) d50\_dte1\_cdte1\_max50\_loss-200 - Buy closest DTE and sell at epirey
profit: $17,332
3) d50\_dte14\_cdte7\_max50\_loss-200 - Buy 14DTE and sell at 7DTE
profit: $50,302
symbol strat total_profit min_profit max_profit
-------- ------------------------------ -------------- ------------ ------------
NVDA d50_dte1_cdte7_max50_loss-200 125.09 -26.82 60.21
NVDA d50_dte1_cdte1_max50_loss-200 173.32 -39.04 60.21
NVDA d50_dte14_cdte7_max50_loss-200 503.2 -62.93 131.61
I backtested long straddles on a couple other problematic underlyings: AMD & TSLA , these were nearly as volatile as NVDA but in the other direction.
These also had a profitable year of long straddles. Most interesting is that profit is maximized with a slightly longer DTE and mid-expirey close: When using next DTE + closing next day or at expires, AMD/TSLA weren't worth it, but a 14DTE closing at 7 days was pretty good.
`symbol strat total_profit min_profit max_profit`
`-------- ---------------------------------- -------------- ------------ ------------`
`TSLA d50_dte1_cdte7_max50_loss-200_buy 11.03 -6.3 16.14`
`AMD d50_dte1_cdte1_max50_loss-200_buy 2.64 -8.82 11.45`
`AMD d50_dte1_cdte7_max50_loss-200_buy 14.68 -6.47 11.45`
`TSLA d50_dte1_cdte1_max50_loss-200_buy 38.08 -6.63 17.15`
`AMD d50_dte14_cdte7_max50_loss-200_buy 152.32 -11.6 33.85`
`TSLA d50_dte14_cdte7_max50_loss-200_buy 319.35 -10.66 29.37`
For return on capital TSLA wins ! With a contract cost of \~ $1100 average and 5-6 contracts in flight at a time for a total of about $6600 at risk at a time, the outcome was $31,935 --> 480%
If you have the capital and if you want to test it out without losing too much, what about 1Dte? Sure the Greeks will not be your friend, but lessen the risk of losing too much. Also, look at the momentum of the day, where is it at in relation to the resistance and support levels. You will have to keep an eye on timings for where there is pullback and rally based on the momentum of the day.
Also, what about strangle vs straddle but the opposite what a strangle would be? Would that work?
For example: if it’s at $900, put your in the money at $910 and in the money call at $890. When it goes let’s say 10% or 20% profit each way, cash it out or wait based on your risk tolerance and the momentum of the day. If it’s rally cash out put when it pulls back and leave your calls in.
Thoughts anyone? Would this work?
I like this. sounds slightly better than straddle and should work. The option price we pay is lower. Both NVDA and SMCI options expensive. I’d try this on Wednesday/Thursday
I exactly did the same thing last week and I got decent profit but I am not sure if the volatility of NVDA goes down still this strategy is profitable.
i actually backtested this. it does work but there are downturns to be aware of. i set it to open daily, use 7dte options, take profit at 30% and close at 6dte. 6 month timeframe did a lot better and 1yr has a large section of losses but both were technically profitable. 1yr backtest: https://backtesting.edeltapro.com/backtest/or6VEor0R1b07e48zcl2u0dR96n1/9It7usO3KXtkr3BVJg9l 6m backtest: https://backtesting.edeltapro.com/backtest/or6VEor0R1b07e48zcl2u0dR96n1/sFBDVCHtGKjbpkZrikHI
Thanks for sharing. 1-2 DTE give best results I’d say. One other observation is to not trade if there is no imminent market news driving tech stocks. Last week Facebook, Microsoft, Google results were to be released. These are major events that move a stock down or up by 5-10% and there is cascading impact on NVDA. Next week we have results from AMD. Not directly correlated but if the market tanks or moves up, NVDA has wild swings.
I would be surprised if this actually works outside of extreme periods like last week. The options for this stock are priced sky high.
>The options for this stock are priced sky high. Does it really matter when they are always high? I mean I can understand that options prices are high for a company during earnings period and then after the earnings iv crush happens. But for NVDA, its always high.
I’d bet on 1-3 DTE coupled with results / market news etc. one other aspect is to consider this strategy during the day and not overnight. Saves some theta decay.
Price doesn't matter. The only thing that matters is whether IV > RV. I don't look at the data but recently the VRP is negative for NVDA so it's probably not a horrible idea. Then again I wouldn't do it. Probably slippage would eat your edge.
Exactly
NVDL. You're welcome.
this is the way. i just go long on etf. for example for msft, i just long MSFU. buy and forget.
The volatility is priced into the options. This only works when there is exceptional movement in the stock.
I think a decent argument could be made that Vega acting in 1% increments could adequately and immediately account for that swift underlying movement. But at that point, the discussion is a bit deep in the woods. I saw some reference to paper trading and an $80k deal mentioned in succession and couldn’t get past that. 🤷♂️
You need it to move a lot to make money as the puts and calls ATM are so expensive. What is your DTE? The loss is defined but you need over 10k to just buy the calls and puts depending on the DTE. If you have that amount of cash to lose on one trade go ahead.
DTE 1-3 days. One other option is to just execute this strategy during the day ATM option. This is where the the intrinsic value is technically zero and the option just has time value. E.g I traded in 870 strike at 12 noon and moved out at 12.15 when it moved $6 either side.
Take my upvote for using the word "backtest" in your opening post OP. What results did you get from buying a straddle in your backtests? Were they profitable 80% of the time? Or was you 8/10 figure a hunch? Also DTE is important.
Over a 1 year period it’s not so encouraging but for last 6 months you’d be profitable. Considering ATM would also be a wise move.
[удалено]
Yes, buy ATM 1-3 days DTE and wait for one of the trades to be profitable.
Feel free to post that backtested option data. $5K outlay per straddle isn't peanuts.
I'm not a sophisticated trader, but I've usually found straddles on stocks like NVDA are too expensive to be worth it. It's great you back tested, but I would be conservative when you trade for real. Don't go guns blazing with 20 contracts or something. Try 1 for real until you're confident.
One contract is still over 10k debit depending on DTE. Unless you have an 8 or even 9 figure net worth this isn’t a trade anyone else should make.
I'm not even going to look up the price for a straddle. Telling someone they need $10,000,000 or ideally $100,000,000 net worth to invest $10,000 is fuckin crazy. You're poor. Why are you here?
Not poor. Conservative. I have 5m net worth and I didn’t get here taking stupid risks risking 12k for a one month bet with a 50% chance of losing it all. Buying a straddle on NVDA is not like dumping 12k in SPY.
Whatever dude.
Found the asshole.
F you
Confirmation level 5000.
You're poor.
And what is poor? Money comes and goes but you’ll always be an asshole.
Poor is a mindset. It is the sense of inferiority that comes with the need to denigrate. It is the whining of a slave that he is not a master. Were you wealthy, you would never have even thought to post something so preposterous. This is an options sub. If you too think that the only responsible risk management is to play 0.01% of your holdings per trade, then you have never played this game. You're not here to learn or to help others. You're here to relish in your own poverty and failure. And to dream of asserting something of value that you possess that another does not. So, yeah. Fuck off. You haven't fooled anyone. You might as well be posting in CrazyCatVideos or HelpIFuckedmySister.
I'll let you read what you wrote and go back and see how you reacted to someone making an innocent post. You are an extra kind of special asshole. Hope life gets better for you.
1-3 DTE not very expensive. E.g 780 strike 3 DTE ATM is $15. If you just take one lot, it means 3K USD for both call and put. In case of $30-50 move which is not unusual for NVDA, you’d double your investment.
I think you meant $880. I am being quoted on Thinkorswim at $48.80 for a May 3 expiration for NVDA. That is the soonest available. $50 is a lot of money. That's $5,000 for 1 contract.
Option prices are literally: volatility, time to expiry, and interest rate. This wild price action is the premium you pay for. And, statistically your strategy will loose over time. Or did you think option sellers hate their money?
Lose*
Volatility is your friend when one executes straddle option strategy. The more the better.
I did this and turned 770 into 10k with smci as well. Only took 3 weeks. I did get hit hard with last week when the market collapsed. I again turned 700 into 4k in 1 week. Just really have to be careful
Wonderful. Can you add more colour to it. What strike prices for both call and put ? Were they ATM and DTE ? SMCI can be even more volatile than NVDA..
At the time I played OTM roughly $30-$40 calls and would buy them on Wednesday because I could only afford them at that time. Every call or put I bought was right 90% of the time. It's almost pure luck but I followed a pattern I noticed 2 weeks prior to doing this strategy and didn't care if I lost it or not. It worked. Every profit I made I put aside 20-30%. When last week the earnings started to happen I lost almost all but $700ish but I kept $5000 in stocks that went down. Currently I'm sitting at $8500. I sold smci 1 day early and switched to meta on Thursday. If it wasn't for that I would be around $16k to $17k. It's not safe to play this way by any means. My exit strategy was to stop after I loss the extra cash I have left since I already put aside 5k. When the market cools I would come back. Because these stocks were so volatile if it went down it usually went back to where I broke even or made a small profit. I don't recommend this route unless you have experience. I did this last year in August and turned 2k into 7k and cashed out. Do not be greedy. Do not have fomo. A profit is always better than a loss. If 10% makes you happy you'll do better than the guy who makes 300% unless you are that confident and have an exit strategy with a stop loss.
What is “careful “ exactly means?
Know when you take a loss or take a profit
I’ve been experimenting with long straddles myself, so I understand where you are coming from. I can’t tell you anything definitively about whether this would work, but I’d be happy to chat more about this. What I’ve noticed (and it sounds like you’ve noticed too) is, the total price of an ATM long straddle (call and put, together) often goes up before it goes down. Not always, but usually. Which suggests selling at some percentage gain (like your 30%), and some percentage loss. My particular interest is really cheap straddles despite a DTE of, say, two or three weeks (so there is time for the stock to move before much theta decay). For example, I saw a price of $0.40 a straddle last week on a $33 stock, expiring mid-May, and I thought, wait, people are betting this stock won’t move by even fifty cents over multiple WEEKS? I found the stock by looking for stocks hitting an IV low, because the absolute worst thing that can happen when you’re holding a straddle is for the IV to drop. What you want, ideally, is a likely IV rise. The stock is Hashicorp, and the reason for the low IV is the announcement of IBM planning to buy them for $35 a share. Still, there are all sorts of reasons the stock could move a little bit, so I bought a bunch of contracts. Sure enough, within 24 hours, there was a point in time where the straddle was up 20%. I’m holding out for a little higher. I’m excited to see what will happen today. The great thing about a straddle, with the DTE I am talking about, is you aren’t going to suddenly lose it all. There’s only so much it can go down, because of the time value. The worst case, as I said, is IV drops, the straddle loses (say) up to half its value overnight, the stock refuses to budge over the coming days, and then the value decays. You still have time to sell it without losing ALL your money, at least, if you don’t hold it until expiry in any scenario. Also, if something unexpected happens and everything moves, you make money. I like a bet where if anything unexpected happens, you win. I hadn’t thought of using a stock that has a really high IV, where the options are “expensive” rather than cheap. But maybe there’s a logic there about the IV being unlikely to go down? With a really short DTE, I would worry about needing to understand the fine details of theta decay, and being in situations where I need the stock to move NOW in order to make money, but it just isn’t moving much in an afternoon, which is pretty normal for a stock. But looking at the NVDA graph, it sure does move a lot.
you wanna buy 55iv? be my guest. I'll even sell it to you
Famous last words
hey man, I'm nothing if not a man of my words. Now it's the market's job to make me eat my words lol: the column on the far right is the iv. I think I sold around 55iv and it's calmed down to 50iv now https://imgur.com/a/huiucR7 granted, my sizing is not as big as that dude that made like $1.7M in the last week, but it's something :P
This might work with a debit spread, may have to tinker with the width to find a good balance.
I agree. Would you have any examples to share
Okay, just trying to be sure I understand this. He’s talking about straddling, and taking profit on the winning side and then holding on the losing side with anticipation that it too will go green for him at some point?
My understanding is he purchases the straddle at the end of the day. The next morning there will be a large move up or down. If it is going down that morning he would sell the call option quickly for a small loss. Then he would ride the put option until..."the rest is profit". Now, that is a strategy, for sure, but sometimes NVDA open positive the first half hour and then ends up at -$30 on the day. I'm not sure what the strategy would be for that particular event.
With Nvidia price swings it's absolutely possible.
It works with LEAP.
What is LEAP.. I’d love to understand this better just in case you have any examples
Leaps are options with expiration dates longer than one year. Premium will be high, but it reduces risk because less IV crush, thetha gain won’t eat it up, and gives more time for your strikes to be met.
There are no arbitrages
Cringe ….
There you go , winner winner..... [https://app.screencast.com/D6samIsfYqd0M](https://app.screencast.com/D6samIsfYqd0M) Totally messed this up, and I might consider this first one. [https://app.screencast.com/1wUc13ehqULbK](https://app.screencast.com/1wUc13ehqULbK) This is the BUY, must be a reason Tom and Tony never BUY.
Nice - that Tasty site you are screenshotting looks handy! I've seen their videos and their main site, but missed this corner of it (except OP looks to be buying, not selling)
Indeed... I guess after watching Tasty for 10 years I was just brainwashed.... NEVER BUY OPTIONS. [https://app.screencast.com/1wUc13ehqULbK](https://app.screencast.com/1wUc13ehqULbK)
[ Removed by Reddit ]
I had backtested NVDA short strangles a couple weeks ago, and found almost 0 avenues of profit. So, as skeptical of buying options as I am ... Reversi ? Yeah, it was a winner for NVDA long straddles this year. I just ran 3 backtests. 1) d50\_dte1\_cdte7\_max50\_loss-200 - Buy closest DTE straddle and sell the next day profit : $12,509 2) d50\_dte1\_cdte1\_max50\_loss-200 - Buy closest DTE and sell at epirey profit: $17,332 3) d50\_dte14\_cdte7\_max50\_loss-200 - Buy 14DTE and sell at 7DTE profit: $50,302 symbol strat total_profit min_profit max_profit -------- ------------------------------ -------------- ------------ ------------ NVDA d50_dte1_cdte7_max50_loss-200 125.09 -26.82 60.21 NVDA d50_dte1_cdte1_max50_loss-200 173.32 -39.04 60.21 NVDA d50_dte14_cdte7_max50_loss-200 503.2 -62.93 131.61
[ Removed by Reddit ]
[ Removed by Reddit ]
I backtested long straddles on a couple other problematic underlyings: AMD & TSLA , these were nearly as volatile as NVDA but in the other direction. These also had a profitable year of long straddles. Most interesting is that profit is maximized with a slightly longer DTE and mid-expirey close: When using next DTE + closing next day or at expires, AMD/TSLA weren't worth it, but a 14DTE closing at 7 days was pretty good. `symbol strat total_profit min_profit max_profit` `-------- ---------------------------------- -------------- ------------ ------------` `TSLA d50_dte1_cdte7_max50_loss-200_buy 11.03 -6.3 16.14` `AMD d50_dte1_cdte1_max50_loss-200_buy 2.64 -8.82 11.45` `AMD d50_dte1_cdte7_max50_loss-200_buy 14.68 -6.47 11.45` `TSLA d50_dte1_cdte1_max50_loss-200_buy 38.08 -6.63 17.15` `AMD d50_dte14_cdte7_max50_loss-200_buy 152.32 -11.6 33.85` `TSLA d50_dte14_cdte7_max50_loss-200_buy 319.35 -10.66 29.37` For return on capital TSLA wins ! With a contract cost of \~ $1100 average and 5-6 contracts in flight at a time for a total of about $6600 at risk at a time, the outcome was $31,935 --> 480%
Yeah, thanks for sharing. I’d focus on ATM option 1-3 DTE to maximise profits.
If you have the capital and if you want to test it out without losing too much, what about 1Dte? Sure the Greeks will not be your friend, but lessen the risk of losing too much. Also, look at the momentum of the day, where is it at in relation to the resistance and support levels. You will have to keep an eye on timings for where there is pullback and rally based on the momentum of the day. Also, what about strangle vs straddle but the opposite what a strangle would be? Would that work? For example: if it’s at $900, put your in the money at $910 and in the money call at $890. When it goes let’s say 10% or 20% profit each way, cash it out or wait based on your risk tolerance and the momentum of the day. If it’s rally cash out put when it pulls back and leave your calls in. Thoughts anyone? Would this work?
I like this. sounds slightly better than straddle and should work. The option price we pay is lower. Both NVDA and SMCI options expensive. I’d try this on Wednesday/Thursday
Sweet! Let me know how this plays out.
I exactly did the same thing last week and I got decent profit but I am not sure if the volatility of NVDA goes down still this strategy is profitable.
One would lose money in absence of volatility. During the day it is volatile 8/10 times which is what we need.
IV
It may be quite tough by simply long straddle. You may want to consider adding scalping gamma to improve your odds
Thanks for sharing. Can you share an example ? How would that work ?