Tom and Tony . You need to have the research team take your 2023 trades (real data) and show what works and not. eg, What are winners, why, losers, why. Show us, practice what you preach. Like Tradevue or Tradezilla.
Thank you for this video! I've begun trading 0dte spx iron condors only very recently and any time I have tried to close out to protect against a loss, if I had just let the trade go to end of day I would have been positive. I know it's different than 45 day iron condors, but the point you make about already having bought the wings for protection really clicked with me.
If you look at your p/l chart (one that accounts for greeks), if the stock moves even a tiny bit with 40 dte you're at a loss. Kind of weird anyone would set a stop loss bc I'd be hit sooner and often.
A symmetrical IC is roughly delta neutral at the start, so I think the main reason is not letting mean reversion play out. e.g. a stock goes up 5% between 45dte and 21dte, you stop out, and then a correction happens after 21dte AND you lose out on a faster theta decay too, and these combined can mess up the stop loss strategy.
Maybe someone can help me out here: With a ( for example) 30 (delta) -10 ) how is that set up? Am I looking for a price at the .30 delta and taking it .10 delta's wide? $10 wide? little insight on this would be great.
Most likely stop losses are hurting because due to the slow overall theta decay in ICs, it means you will be at a loss between the breakeven points, and not far from the middle point for pretty long through 45 - 21 DTE cycle
They have shown (although in very limited capacity because it doesnt align with their values) that including both a stop-loss AND a profit-take was the best strategy, in some of the shorter trades (1DTE,0DTE)
Trade iron flys in 0DTE.. take profit at 25 percent of max profit. Buy the wings wherever the following days expected move. Been working great recently
@@Dadvestor I like 14 DTE short vertical spreads in SPX and RUT, using technical analysis to guide whether bearish or bullish. I only add the complementary spread for an IC to help mitigate losers. I have revised “ROC” to return on invested capital (ROIC). If PNL is analogous to “return” and BPR is analogous to “invested capital,” then I ask you to explain why PNL/BP is different from ROIC.
@@randyhibshman3682 thanks for sharing that, I do something similar. What is a ballpark ROIC for you? I don’t know exactly why but I don’t think 2% is really what you would expect and my results running their strategy is higher than 2%
Given that there are 12 monthly expirations, we're looking at 12x the shown 1.1-4.3% P&L/BPR, compounded. Say that averages 2%, then it's 1.02^12 = 26% annual ROIC.
@@TokisanGames I also looked at compounding. I think it is generous to say that a 45 DTE trade compounds 12 times per year. I think compounding 8 times per year (365 / 45) is a better estimate for achieving closer to the full 2% profit. Compounding 12 times per year would probably be taking 50% of max profit. At 2% return per trade cycle, compounded 8 times per year, 1.02^8 = 1.17, which is on par with the total return of just selling 30 delta covered calls in SPY, assuming 8-10% appreciation in the underlying. It’s good but not great.
Tom and Tony . You need to have the research team take your 2023 trades (real data) and show what works and not. eg, What are winners, why, losers, why. Show us, practice what you preach. Like Tradevue or Tradezilla.
it would be nice if you guys put in a visual of the iron condors and other trades more often please.
Thank you for this video! I've begun trading 0dte spx iron condors only very recently and any time I have tried to close out to protect against a loss, if I had just let the trade go to end of day I would have been positive. I know it's different than 45 day iron condors, but the point you make about already having bought the wings for protection really clicked with me.
Sorry novice here. Does no stop loss basically mean you should basically just do a strangle instead of an Iron Condor?
No a stop loss is very different from not having the corresponding options.
So is the no-stop loss using a 21 day close/roll?
correct
bruhat pen drive factory open maadi?
Thanks for this one, who would have any friends left after Mony Hall-ing them publicly?
If you look at your p/l chart (one that accounts for greeks), if the stock moves even a tiny bit with 40 dte you're at a loss. Kind of weird anyone would set a stop loss bc I'd be hit sooner and often.
A symmetrical IC is roughly delta neutral at the start, so I think the main reason is not letting mean reversion play out. e.g. a stock goes up 5% between 45dte and 21dte, you stop out, and then a correction happens after 21dte AND you lose out on a faster theta decay too, and these combined can mess up the stop loss strategy.
Maybe someone can help me out here: With a ( for example) 30 (delta) -10 ) how is that set up? Am I looking for a price at the .30 delta and taking it .10 delta's wide? $10 wide? little insight on this would be great.
Most likely stop losses are hurting because due to the slow overall theta decay in ICs, it means you will be at a loss between the breakeven points, and not far from the middle point for pretty long through 45 - 21 DTE cycle
They have shown (although in very limited capacity because it doesnt align with their values) that including both a stop-loss AND a profit-take was the best strategy, in some of the shorter trades (1DTE,0DTE)
Can you guys run the same research on ODTE iron condors and or credit spreads ? Great research.
Trade iron flys in 0DTE.. take profit at 25 percent of max profit. Buy the wings wherever the following days expected move. Been working great recently
@@chrisbasnettill have to give this a try
I have moved away from spreads trades, I had a 75 percent win rate and had a net loss.
same, one loser wipes out so many winners with these
Im out at 2x times the credit. Stop losses are tricky
I’m a true novice, but this basically comes down to trusting the statistical models that you bet with in the beginning.
Correct. If you enter the trade with even a slight advantage, over time you will win.
Stop losses are for losers lol. Buying protection 👌
On an Iron Condor on NQ, last november, i lost also my pants.
same
I guess it was too wide or size too big.
PUNTING on this strategy = Not 100% be the winner with 0% loss.
If you lost your pants then you had too big a size. You KNOW the max loss in a Iron Condor.
@@me4901 correct, i undervalued the upside potential, especially during the seasonality.😔
for even the best PNLs shown here (about 2% ROIC) it’s a wonder anyone wants to sell 45 DTE iron condors in the SP 500.
What do you recommend? Also I’m not sure but I don’t think average PL / BPR is ROC.
@@Dadvestor I like 14 DTE short vertical spreads in SPX and RUT, using technical analysis to guide whether bearish or bullish. I only add the complementary spread for an IC to help mitigate losers. I have revised “ROC” to return on invested capital (ROIC). If PNL is analogous to “return” and BPR is analogous to “invested capital,” then I ask you to explain why PNL/BP is different from ROIC.
@@randyhibshman3682 thanks for sharing that, I do something similar. What is a ballpark ROIC for you? I don’t know exactly why but I don’t think 2% is really what you would expect and my results running their strategy is higher than 2%
Given that there are 12 monthly expirations, we're looking at 12x the shown 1.1-4.3% P&L/BPR, compounded. Say that averages 2%, then it's 1.02^12 = 26% annual ROIC.
@@TokisanGames I also looked at compounding. I think it is generous to say that a 45 DTE trade compounds 12 times per year. I think compounding 8 times per year (365 / 45) is a better estimate for achieving closer to the full 2% profit. Compounding 12 times per year would probably be taking 50% of max profit. At 2% return per trade cycle, compounded 8 times per year, 1.02^8 = 1.17, which is on par with the total return of just selling 30 delta covered calls in SPY, assuming 8-10% appreciation in the underlying. It’s good but not great.