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RUT M3 Trade Journal – March Entry

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14 replies, 5 voices Last updated by Justin Ware 5 years, 5 months ago
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    • #2449

      Justin Ware
      Participant
      @wareinjust@hotmail.com
      Points: 1 014
      30 Day Affirmation ChallengeThe Trading Triangle Maui 2016APM2
      Rank: Sophomore

      I’m late on this update due to being out of town the past few days. Since I had little/no access for adjustments, I closed my position Tuesday morning for a loss of 6.8% of my planned capital. After examining my adjustments, my main takeaway is to improve my adjustments during an upward move. I plan on entering a new position tomorrow at 49 DTE and starting a new log. Thanks to everyone who’s provided feedback during this trade.

    • #2433

      Michael Durojaye
      Participant
      @mdurojaye@gmail.com
      Points: 598
      Rank: Freshman

      As I haven’t got ONE & your exact trade prices,its difficult to be exact with my thoughts, however, your adjustments appear to address the theta & vega issue (I’m presuming you rolled the 995 puts up to the 1005 puts) , modeling the position in OV whose greeks I know will differ from ONE, I have the protection down to the 970 & 960 area before you will need some adjustments again.
      Good luck with the trade, lets see what Monday brings.

    • #2430

      Michael Durojaye
      Participant
      @mdurojaye@gmail.com
      Points: 598
      Rank: Freshman

      My 2cents – you need to roll up more shorts, get some -ve vega, your +ve vega is going to make the trade sink further into the sea of death. As there are only 28 dte, the value of your longs will no longer hold up, they will decay very rapidly & your total shorts (theta) are not enough to counter the accelerating decay of your longs.
      In a nut shell, you need more theta & -ve vega. Restructuring the trade is your best option, unless the market has a big enough pull back.

      • #2431

        Justin Ware
        Participant
        @wareinjust@hotmail.com
        Points: 1 014
        30 Day Affirmation ChallengeThe Trading Triangle Maui 2016APM2
        Rank: Sophomore

        Michael – I played around with some adjustments and came up with the position below by rolling all of the long 995 puts, 4 of the long 910 puts, and some of the short 945 & 960 puts. This corrects my greeks and still gives me downside protection to the 940 area. Thoughts?

    • #2428

      Justin Ware
      Participant
      @wareinjust@hotmail.com
      Points: 1 014
      30 Day Affirmation ChallengeThe Trading Triangle Maui 2016APM2
      Rank: Sophomore

      Adjusted the trade today (yet again). Gamma is starting to creep it’s way in. We’re now 15 points over my long 995 put and technically should be rolling up the entire position. I analyzed this possibility and didn’t like the resulting graph. So if the market continues its move up Monday, I plan to close the entire position and enter a new position in April expiration.

      Current Position:
      +1 165 call
      +12 995 puts
      -12 960 puts
      -12 945 puts
      +12 910 puts

    • #2397

      Justin Ware
      Participant
      @wareinjust@hotmail.com
      Points: 1 014
      30 Day Affirmation ChallengeThe Trading Triangle Maui 2016APM2
      Rank: Sophomore

      With the move up today, I rolled some of my short puts. I’m currently long vega so I’ll look to roll some more short puts tomorrow to reduce it. I’m trying to hold off on rolling up the entire position because of the large swings in price that we’ve been experiencing in the market. Thankfully, I am relatively safe in either direction.

      My position is as follows:
      +1 165 call
      +12 995 puts
      -6 960 puts
      -6 950 puts
      -12 945 puts
      +6 910 puts
      +6 900 puts

    • #2286

      Justin Ware
      Participant
      @wareinjust@hotmail.com
      Points: 1 014
      30 Day Affirmation ChallengeThe Trading Triangle Maui 2016APM2
      Rank: Sophomore

      Rolled back again today and looked at the chart showing the dates of my trades. I have to say, despite my mad timing, my position doesn’t look too bad. I split my short strikes because the lowest put strike I needed doesn’t exist for March (895) and I wanted a little more downside protection than having all of my shorts at 950 would have provided. Hope everyone’s trades are doing well!

      Current position:
      +1 165 call
      +12 995 puts
      -12 950 puts
      -12 945 puts
      +12 900 puts

    • #2246

      Justin Ware
      Participant
      @wareinjust@hotmail.com
      Points: 1 014
      30 Day Affirmation ChallengeThe Trading Triangle Maui 2016APM2
      Rank: Sophomore

      With the down move in RUT today, I rolled my position back. I must say, I have great timing to start my full sized M3 career!
      <br>
      New Position is:
      <br>
      915/965/1015 Put fly
      965 long call

    • #2211

      Gabor Maly
      Participant
      @malygabor@gmail.com
      Points: 525
      30 Day Affirmation ChallengeThe Trading Triangle Maui 2016
      Rank: Freshman

      Your postion looking strong and solid for today. (this latest pic on your trade is a better magnification, the one where you were showing a possible rolling in the longs seemed to be more at risk)

      This is one thing the OV users (like me) need to get used if we make a jump to ONE, we like to have the trade magnified 20x times to calm our minds and think we do not have risk in either direction 🙂

    • #2195

      Justin Ware
      Participant
      @wareinjust@hotmail.com
      Points: 1 014
      30 Day Affirmation ChallengeThe Trading Triangle Maui 2016APM2
      Rank: Sophomore

      Gabor – Thanks for your input! After considering your points and my goal of trading conservatively, I see that I should have rolled back my position yesterday to play it safe. With that being said, I didn’t read your post until after the market closed and I made my adjustment. If the market moves down tomorrow, I will look to roll back the entire position. My T+0 line is pretty flat, however I could be in some trouble with a large gap down opening and a spike in volatility.
      <br> <br>
      Current Position:
      +8 1060 puts
      +4 1050 puts
      -16 1010 puts
      -8 1000 puts
      +12 960 puts
      +1 975 call

      ToS position delta = 13.66, ONE position delta = 7.62

    • #2191

      Gabor Maly
      Participant
      @malygabor@gmail.com
      Points: 525
      30 Day Affirmation ChallengeThe Trading Triangle Maui 2016
      Rank: Freshman

      Justin, my two cents.

      One of the key success factors for surviving January was aggressive roll back. This is certainly something I have not done and have been trying to operate with smaller vertical corrections thinking the market will bounce back up and then when it did not I had to chase the market down. The adjustment you have done on Tuesday in this market environment is fine to stabilise the trade but then it needs to get fixed. A significant gap up this morning would have put you underwater with vol crush and a significant gap down (2-3% has been common in Jan) would have led you to intervene intraday which is never good. You do not have risk to the upside with an M3 with aggressive roll back the worst that can happen is that your profit for that month will be smaller, but if you play it “safe” on the downside you can get burned. This market is still very volatile, just look at the market action today, so keep your T+0 line as flat as possible and gamma low. Bottom line: I do not want the market to close at my short strike.

    • #2189

      Joe Anderson
      Participant
      @JoeScottAnderson@gmail.com
      Points: 28
      Rank: Newbie

      I have one suggestion, Justin, and that is that you remove the Max Profit and Max Loss lines from the chart before you post the image here. This makes it easier to see the T+0 line. Thank you for sharing this trade.

      Joe

    • #2176

      Justin Ware
      Participant
      @wareinjust@hotmail.com
      Points: 1 014
      30 Day Affirmation ChallengeThe Trading Triangle Maui 2016APM2
      Rank: Sophomore

      With the large move down today, I made an adjustment to give me some more downside protection. I rolled down some of my short puts to get me to slightly positive delta (at 3:30 pm EST, the time of adjustment). Interestingly, I’m currently showing roughly -14 delta in ToS, but ONE is showing -22 delta. I’ll have to take note of this discrepancy going forward as I do my adjustments using ToS deltas. If the market moves up tomorrow, I plan on rolling some of my long 1060 puts to 1050 with the goal of getting my T+0 line flat to the upside. If the market continues to pull back, I will likely roll back the entire setup.

    • #2150

      Sherri Locke
      Keymaster
      @KDAKSj4ux
      Going to The Trading Triangle LIVE 2016Ultimate Income Trader Workshop

      Looks great Justin! Thank you for your contribution!

    • #2148

      Justin Ware
      Participant
      @wareinjust@hotmail.com
      Points: 1 014
      30 Day Affirmation ChallengeThe Trading Triangle Maui 2016APM2
      Rank: Sophomore

      I entered into an M3 today when RUT was trading around 1035. I am looking to trade this conservatively with a profit target of 5% on planned capital. I’ve previously been trading a small version M3 (broken wing condor) so this is my first M3 using the actual initial setup as taught by John. I plan to update this thread as adjustments take place or weekly in the event of no adjustments. Additionally, I work full time so I will be adjusting using the greeks on mobile ToS and then analyzing after market close. Note: this is my first post with an image so hopefully everything looks alright!

      DTE: 45 Days
      Butterflies: 960/1010/1060
      Long Call: 975
      Planned Capital: $30,000
      Profit Target: 5%, $1,500

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