Hi Levi, Thanks for the excellent videos. I had a question about your patron I was considering. At the Option Traders Club level I understand we get notified of your option trades. Are those notifications at the end of the day or right after the trade executes? Thank you
Hi Michael, thanks for reaching out. When I make a trade, the trades notifications are posted to the discord chat room within a few minutes of a filled trade. Also there is a real-time spreadsheet sheet available to options tier members that shows all open option positions. Open trades that generate weekly cash flow or need adjustments often have the potential new positions entered into the sheet before the trade is executed.
Not totally clear from the video why the dynamic hedged position is superior to a naked straddle - is the rationale that it's a shorter distance for the stock to move to reach profitability, or that you get to stay in the position for an extended period while you wait for the stock to make a big move without much/any theta decay (relative to ths straddle)? Also, can you do a video where you walk through the paired condors? (are you using shorter durations for the counter-trade for example)
Trade makes money while moving back and forth rather than requiring a large move at all. Half the theta decay of a straddle. Yes shorter duration iron condors.
How do you get a CREDIT in this strategy ? You buy 3 x Call for a Debit and for selling Shares you don´t get an initial Credit . This Strategy is a DEBIT Strategy at the beginning.
If I buy a call I have a debit to pay and if you go short in a physical stock at the same time you stay at zero plus commission, ist not possible to get a credit , from what the credit is coming in your trade? You can trade this also in Option Net explorer or any other tool, you never will get a credit . I don’t understand it what IB is showing there.
I started it because I had so many requests to see my exact trades and I thought it was reasonable to request that I get paid for my time to post trades and discuss the process. It has evolved from there to be more than a full time job to run the chat room. I help a considerable amount of people and a private group allows for me to focus on those individuals who are serious about learning and increasing their knowledge within a moderated community. I’ve run completely free groups before and they get out of hand quickly. Also the income generated from my patrons allows me a bit of freedom to spend money to continue to improve services. As you probably know, video creation is a time consuming endeavour and I would love to eventually have some help so that I can improve my content.
I don’t have a video on that sheet but it’s very straightforward. Each row enters a new trade individually. Can be a stock purchase, dividend, or option. The entry and exit is recorded on each row. There is an annual summary sheet which shows the account growth weekly with a chart.
Levi - Thanks for the great video on dynamic delta hedging. I purchased your spreadsheet and reconfigured it for excel. I use Marketxls to input live option data. It seems to me that you can also construct a similar hedge with a long put and a long stock position. This would allow use of this strategy in an IRA. I’m having a bit of trouble wrapping my head around the P/L from doing this. I know you have the gains/losses computed in the spreadsheet, but a lot of trades don’t seem a generate a great amount of P/L. Is this to be expected? Tx - Mark
Hey Mark, Sorry about my tardy reply. This shows in an usual place here on TH-cam that I don't often check. Dynamic Hedges usually carry a cost and don't make money by themselves. I typically pair them with a short put, or a setup similar to an Iron Condor that makes money if the stock doesn't move. The dynamic hedges by themselves make most of the income to the downside and don't generate all that much on up moves. Hope that helps! Enjoy the rest of your weekend.
great explaination, could you help to clarify below 2 questions? 1. why dont you buy put + short stock? it donst require the interest fee for inital build up 2. how to choose the underlying stock with high volitality?
What if the short stock starts falling in price and you buy but it still keeps falling (how will anyone time the bottom), won't you keep losing money on your long call?
I am considering writing a put and going short the stock on the strike price. I believe the only way to lose in this scenario is if the price continues to fluctuate in and out of the strike price. Please let me know if you have any thoughts on this matter. Thank you!
The strategy alone it is not profitable most of the time if you use just one stock. This technique is used by large investors or market makers to reduce the risk in multiple basket of asset. At this point it is better to use a Straddle strategy to avoid high commission costs.
you cant make money when the stock moves either side. because you neutralize delta already (its out of straddles profit logic) bcs when the stock moves either way you would have neutral delta. so you cant profit from the move of stock price. but its true you profit from selling high buying low. but can it cover the theta cost ? very limited profit seems on this strategy. it looks like selling straddle in mirror. it seems you have an idea thet if can volatility beats the time decay or time beats the volatility.
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How do you deal with news if you are into a hedge? Cause if there is an high impact news there will be a slippage on your entry..
The best video on dynamic hedging
At 2:51, how do you get the "CHNG %" shown on your watch list?
Good video, well informed 📌
Hi Levi,
Thanks for the excellent videos. I had a question about your patron I was considering. At the Option Traders Club level I understand we get notified of your option trades. Are those notifications at the end of the day or right after the trade executes? Thank you
Hi Michael, thanks for reaching out. When I make a trade, the trades notifications are posted to the discord chat room within a few minutes of a filled trade. Also there is a real-time spreadsheet sheet available to options tier members that shows all open option positions. Open trades that generate weekly cash flow or need adjustments often have the potential new positions entered into the sheet before the trade is executed.
Very good video. Clear and precise explanations. A question...Could the Excel table be used futures options ? Thank you
Yes, absolutely.
What is the software you use to edit your videos? Great job by the way !
I use Final Cut Pro X.
Hi, thank You for this great video. Did You do it with Camtasia ? - or wich Software did You use - Greetings from Switzerland
Very interesting, can you provide a video with an example of a profitable trade using this strategy? Appreciated :)
Not totally clear from the video why the dynamic hedged position is superior to a naked straddle - is the rationale that it's a shorter distance for the stock to move to reach profitability, or that you get to stay in the position for an extended period while you wait for the stock to make a big move without much/any theta decay (relative to ths straddle)? Also, can you do a video where you walk through the paired condors? (are you using shorter durations for the counter-trade for example)
Trade makes money while moving back and forth rather than requiring a large move at all. Half the theta decay of a straddle. Yes shorter duration iron condors.
How do you get a CREDIT in this strategy ? You buy 3 x Call for a Debit and for selling Shares you don´t get an initial Credit . This Strategy is a DEBIT Strategy at the beginning.
I show the exact figures at 15:30 in the video. The net CREDIT to open the position is about $2800.
If I buy a call I have a debit to pay and if you go short in a physical stock at the same time you stay at zero plus commission, ist not possible to get a credit , from what the credit is coming in your trade? You can trade this also in Option Net explorer or any other tool, you never will get a credit . I don’t understand it what IB is showing there.
Maybe your broker doesn’t give you the credit? I know Webull does
Brilliant !
MY PROBLEM IN OPTION TRADE IS IT NEED HIGH INTIAL PREMIUM FOR A POSITION..
Or learn to play strategies that don’t require high premium to make money. Diagonals.
Why would one need a patreon if you're a trading guru?
I started it because I had so many requests to see my exact trades and I thought it was reasonable to request that I get paid for my time to post trades and discuss the process. It has evolved from there to be more than a full time job to run the chat room. I help a considerable amount of people and a private group allows for me to focus on those individuals who are serious about learning and increasing their knowledge within a moderated community. I’ve run completely free groups before and they get out of hand quickly. Also the income generated from my patrons allows me a bit of freedom to spend money to continue to improve services. As you probably know, video creation is a time consuming endeavour and I would love to eventually have some help so that I can improve my content.
Can I use the sheets for trades where I buy stocks + long put?
Not this sheet. Check out my y “options journal” as it is great for tracking that type of trade.
@@DrawbridgeFinance Do you please have a video where there was a tutorial on how to work with the "option journal"? I can't find any. Thank you
I don’t have a video on that sheet but it’s very straightforward. Each row enters a new trade individually. Can be a stock purchase, dividend, or option. The entry and exit is recorded on each row. There is an annual summary sheet which shows the account growth weekly with a chart.
Levi - Thanks for the great video on dynamic delta hedging. I purchased your spreadsheet and reconfigured it for excel. I use Marketxls to input live option data. It seems to me that you can also construct a similar hedge with a long put and a long stock position. This would allow use of this strategy in an IRA. I’m having a bit of trouble wrapping my head around the P/L from doing this. I know you have the gains/losses computed in the spreadsheet, but a lot of trades don’t seem a generate a great amount of P/L. Is this to be expected? Tx - Mark
Hey Mark, Sorry about my tardy reply. This shows in an usual place here on TH-cam that I don't often check. Dynamic Hedges usually carry a cost and don't make money by themselves. I typically pair them with a short put, or a setup similar to an Iron Condor that makes money if the stock doesn't move. The dynamic hedges by themselves make most of the income to the downside and don't generate all that much on up moves. Hope that helps! Enjoy the rest of your weekend.
great explaination, could you help to clarify below 2 questions?
1. why dont you buy put + short stock? it donst require the interest fee for inital build up
2. how to choose the underlying stock with high volitality?
Buying puts and shorting stock are both bearish trades. I typically want to be neutral.
You can look at IV rank. This lets us know if the underlying is in a high range of its typical volatility.
Do you still employ this strategy currently with your other strategies?
Yes but only on a few stocks.
What if the short stock starts falling in price and you buy but it still keeps falling (how will anyone time the bottom), won't you keep losing money on your long call?
Your short will appreciate more than your long call depreciates so you can exit the enter trade in profit
I am considering writing a put and going short the stock on the strike price. I believe the only way to lose in this scenario is if the price continues to fluctuate in and out of the strike price. Please let me know if you have any thoughts on this matter. Thank you!
If the stock rockets to the upside, you'll be in trouble. You're talking about the inverse of a Covered Call, which effectively is a Covered Put.
selling ATM straddles is wild
The strategy alone it is not profitable most of the time if you use just one stock. This technique is used by large investors or market makers to reduce the risk in multiple basket of asset. At this point it is better to use a Straddle strategy to avoid high commission costs.
Long straddle? The vix is very low so that makes tons of sense.
@@DrawbridgeFinancestraddle has to be pre-filtered with a trend indicator like ADX or the ImpliedVolatility itself
you cant make money when the stock moves either side. because you neutralize delta already (its out of straddles profit logic) bcs when the stock moves either way you would have neutral delta. so you cant profit from the move of stock price. but its true you profit from selling high buying low. but can it cover the theta cost ? very limited profit seems on this strategy. it looks like selling straddle in mirror. it seems you have an idea thet if can volatility beats the time decay or time beats the volatility.
ATI is $56 in 2025 !
Nice
It seems their is no profit to this strategy.
First