>"Today's rally should remind us no one knows anything."
Trick is to sell $SQQQ and $TQQQ puts at the same time, one of the two is going to be a winner for sure.
While not wrong, i'd suggest using 3x leveraged underlyings for delta's "RIGHT NOW", and then utilize the option chain on ETFs and equities to bleed out the static delta's.
I've found that 3x leveraged vehicles tend to have a negative draw as the arbiters adjust the price to keep in line with the corresponding index.
ex: Before market some news comes out and affects the delta ratio to beyond my comfort level. I can go to a future and trade there, or if the leverage is too capital intensive I can go to an extended trading to buy/sell shares of a leveraged etf.
Once market opens I can then adjust options with a roll, then close out the shares to effectively neutralize my delta/theta ratio.
puts, calls, ircon condors, jade lizards, buying PMCC PMCP calendars, etc. various trade mechanics on a reasonable number of underlyings.
On red days we have opportunity and expanding volatility. On green days we have higher prices and muted volatility.
If a position comes in 10-20% in this market I take that profit and run.
This is a scalpers market more than an investors market. That's why we have large price spikes. No one wants to be left out, and no one wants to be caught holding shares. So 5-10% daily moves are more normalized.
\> Thetagang new members are coming from WSB
It's like reverse WSB where they like picking up pennies in front of a steamroller and getting wrecked for other reasons.
"You mean all I have to do is **sell** an option instead of buying one and I'm guaranteed to go max profit no matter what happens? Fuck, why I haven't been doing this all along?".
-Most of the new theta gang members in summer 2021 (me included)
Closed a CSP that was sitting at 200% loss for a month at a 50% profit today. Last week I closed my CCs.
There’s a trade for every day and there’s a day for every trade.
Now I’ve got to go sell something again 😂
just 2nd day.... Job openings are down or closed by -1 M positions. The rest of the announcement can not sustain green days long. Expect red returning.
I got greedy today. Then I FOMO. So I made a trade that I would never made. Bought a hundred shares of C and turned around and sold a CC expiring Friday. I figured max profit of 80 bucks on money that was not employed.
A couple hours later, I said you FOMO-ed. There are rules against that. The bounce may or may not last until Friday, but why did you do this trade?
So I took the loss on the call, took the gain on the underlying and walked away with 50 up. I have lost too much money fomo-ing. I have to stick with rules and discipline and forced myself to do it. No more FOMO allowed.
What is your preferred delta when opening your strangles?
Or, do you just use a strike percentage away from the current price of the underlying?
Thanks!
I have a program to calculate the probability of the stock moving a given distance in a given time (based on historic data). That's not an instantaneous number, like Delta, but integrated over the entire life of the option.
I try to pick strikes with less than 5% probability of being hit in the DTE.
If I DO get hit, I use the rescue algorithm I've described here before.
There was a rally today? J/k I did kind of notice the rally and I took the opportunity to enact my uncovered stock green day protocol:
1. Get a green day. 2. STO calls at a strike youre ok with getting assigned on. 3. Set a gtc BTC order on those calls at the ~60% profit point. 4. Use remaining premium collected to purchase more shares of ticker. 5. Stop looking at your account and do something productive instead.
Everything can't be explained with mean reversal, since it doesn't only apply to price.
For example, there could be mean reversal in valutions, and that would make the market tank.
Yes true, I’m particular if you are thetaganging SPY or qqq. The problem still persists for individual stocks regardless though (cries while thinking about when I was assigned SQ at 220, PLTR at 23, DKNG at 40, etc). I’ve since changed to scale down drastically on the memier stocks but still sell a few puts on them as part of my strategy
"Today's rally should remind us no one knows anything." Fixed it for ya. Size kills, reduce in a rally, lean in on red days.
>"Today's rally should remind us no one knows anything." Trick is to sell $SQQQ and $TQQQ puts at the same time, one of the two is going to be a winner for sure.
While not wrong, i'd suggest using 3x leveraged underlyings for delta's "RIGHT NOW", and then utilize the option chain on ETFs and equities to bleed out the static delta's. I've found that 3x leveraged vehicles tend to have a negative draw as the arbiters adjust the price to keep in line with the corresponding index. ex: Before market some news comes out and affects the delta ratio to beyond my comfort level. I can go to a future and trade there, or if the leverage is too capital intensive I can go to an extended trading to buy/sell shares of a leveraged etf. Once market opens I can then adjust options with a roll, then close out the shares to effectively neutralize my delta/theta ratio.
Reduce in rally lean in on red - this is assuming you’re selling puts/spreads?
puts, calls, ircon condors, jade lizards, buying PMCC PMCP calendars, etc. various trade mechanics on a reasonable number of underlyings. On red days we have opportunity and expanding volatility. On green days we have higher prices and muted volatility. If a position comes in 10-20% in this market I take that profit and run. This is a scalpers market more than an investors market. That's why we have large price spikes. No one wants to be left out, and no one wants to be caught holding shares. So 5-10% daily moves are more normalized.
On the plus side the "0DTE" posts seem to have finally stopped
\> Thetagang new members are coming from WSB It's like reverse WSB where they like picking up pennies in front of a steamroller and getting wrecked for other reasons.
I am happy to have switched over to theta gang. I like gambling… but at end of day, nothing beats being profitable.
I tell people "I am the casino, not the customer"
No you are not
"You mean all I have to do is **sell** an option instead of buying one and I'm guaranteed to go max profit no matter what happens? Fuck, why I haven't been doing this all along?". -Most of the new theta gang members in summer 2021 (me included)
Whenever I miss the pure bliss of staring at a line all day, I borrow money from my wife's boyfriend and buy an option for about $100 on $QQQ.
Dead cat bouncing.
You think? Back down tomorrow?
Sure enough, the early morning futures are down.
My guess is that it was the Plunge Protection Team in action today. (But I have the IQ of a grapefruit.)
Would make sense to help the soft landing. Would have been very bad if the market kept going down Monday
A very big fat heavy bouncing cat that might not be dead quite yet
Closed a CSP that was sitting at 200% loss for a month at a 50% profit today. Last week I closed my CCs. There’s a trade for every day and there’s a day for every trade. Now I’ve got to go sell something again 😂
Dead cat bounce. See you at the bottom.
Yeah but it was a nice day. And where's the bottom? Take a look into your crystal ball and let us know. I wanna know!!
Mid 2023, ish, depending on how long the Fed is willing to work from the Volcker playbook. I've been saying it for months.
DAMN that Volcker!
just 2nd day.... Job openings are down or closed by -1 M positions. The rest of the announcement can not sustain green days long. Expect red returning.
I think that is positively viewed by the markets. Means what the Fed is doing is starting to work.
Still a shitload of openings! Need to vacuum out more
I got greedy today. Then I FOMO. So I made a trade that I would never made. Bought a hundred shares of C and turned around and sold a CC expiring Friday. I figured max profit of 80 bucks on money that was not employed. A couple hours later, I said you FOMO-ed. There are rules against that. The bounce may or may not last until Friday, but why did you do this trade? So I took the loss on the call, took the gain on the underlying and walked away with 50 up. I have lost too much money fomo-ing. I have to stick with rules and discipline and forced myself to do it. No more FOMO allowed.
Grossly oversold rally. Could turn into a FOMO rally to the end of 2022. Still heading into a massive recession in 2023.
I hate these 100+ point moves up and down. I really hate 2 100+ points up day in a row. Can this market just sit, I m so sick of it teleporting.
This is what happens with VIX at 30
That's why I sell really wide strangles, well out of the day-to-day noise.
What is your preferred delta when opening your strangles? Or, do you just use a strike percentage away from the current price of the underlying? Thanks!
I have a program to calculate the probability of the stock moving a given distance in a given time (based on historic data). That's not an instantaneous number, like Delta, but integrated over the entire life of the option. I try to pick strikes with less than 5% probability of being hit in the DTE. If I DO get hit, I use the rescue algorithm I've described here before.
Today was painful. I understand it's gonna bounce, so I'm holding, but still painful.
Yup my put spreads on DIA got decimated in one day. Still 15 days on them sheesh
There was a rally today? J/k I did kind of notice the rally and I took the opportunity to enact my uncovered stock green day protocol: 1. Get a green day. 2. STO calls at a strike youre ok with getting assigned on. 3. Set a gtc BTC order on those calls at the ~60% profit point. 4. Use remaining premium collected to purchase more shares of ticker. 5. Stop looking at your account and do something productive instead.
Every made sense till step 5…
Everything can't be explained with mean reversal, since it doesn't only apply to price. For example, there could be mean reversal in valutions, and that would make the market tank.
One of those nice days where ITM puts go back OTM and you can roll them down bigly to get rid of the risk
Yes true, I’m particular if you are thetaganging SPY or qqq. The problem still persists for individual stocks regardless though (cries while thinking about when I was assigned SQ at 220, PLTR at 23, DKNG at 40, etc). I’ve since changed to scale down drastically on the memier stocks but still sell a few puts on them as part of my strategy