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2021.10.25 – SESSION 851 – OPTIONS TRADING FOR INCOME

3 replies, 2 voices Last updated by Sherri Locke 1 month, 1 week ago
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    • #18105

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

      The recording of the live Options Trading for Income by the Guidelines session from earlier today is ready to view. Enjoy!

    • #18100

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

      The trade logs and the trading results spreadsheet for October expiration are read to view. Enjoy!

    • #18078

      Dave Nadeau
      Participant
      @dave.nadeau@live.com
      Points: 269
      Rank: Freshman

      Thanks for your explanation last week about considerations for choosing which leg to adjust on a BFly, John!  That was very helpful.

      As a follow up question, I’m wondering about another type of adjustment that I sometimes make.  I’d love to hear your thoughts, and possibly cautions on this.

      As an M3 gets further into the trade, say down to DTE 10 or so, the T+0 line does start to bend more each day.  In an upmove, in order to adjust some of the negative Delta, I’ve sold off a few of the BFly’s instead of moving anything.  Typically, I’ve done this when price is around or just below the upper long strike (still in the tent), but Delta is getting too high.  My thinking is that I will most likely be rolling the trade upwards, and I’ll be selling those anyway.  It has the added benefit of reducing my overall capital if I am getting close to PC for the trade.

      The downside is that I have less “skin” in the trade, so my Theta and other Greeks are less powerful  (said another way, I’m giving up some of my premium capture opportunity).  But I’ve also noticed that other adjustments (e.g. rolling down 1/2 of my upper long strike) reduces my Greeks as well.

      Normally, I will size back to up standard position (10 lot or 20 lot) when I roll up or adjust down in the trade.

      I’d love to hear your thoughts on this type of an adjustment used later in a trade.

       

    • #18069

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

      Please post your questions or trade review requests for this session at least 48 hours prior to the live session so we can prepare the most complete and detailed answers for you! Thank you!

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