So you combine the best of both worlds - directional OTM tent w/ +theta booster once inside tentI do the first part not so much the second part unless there is a directional edge because risking 1 to make 9 has a much lower probability unless you know the direction
With the iron condor you will make money anywhere inside the tent
If you are outside the tent you will not make money unless the underlying goes into the tent but the tent has to be in the direction of where the market will be when it expires which is much harder to predict under normal market conditions
Anyone do these, selling condors or one sided verticals risking 9 to make 1 or the inverse - with directionality edge risking 1 to make 9 sometimes while benefitting from probability of touch to make 2-5x frequently? Sound off!
I think a better way would be to put in a stop/limit order but I am not sure if it can be done on a spreadAm I suppose to use a Stop order at 1.50 and have it buy back with a market order (that seems dangerous because of slippage/spread)
I have been doing the 0 DTE on SPX for the past couple of months. They have worked great with the flat market, only had a couple of losses. I put them on as early in the day as possible once the market stabilizes. I use the price of the SPX to set my stop orders, but they need to be adjusted while the trade is active as the premium dissolves. I tend to watch the trades closely while they are on and adjust accordingly. It's been a very profitable trade for me so far. Here's a webinar that explains it fairly well:
Just curious on how you did the backtestingI backtested it from start of this year through first week of May
You have to try to determine which way the market want's to go early in the morning You want to place the put spread at the beginning of the day preferably after a gap down and maybe not even place a call since it has a tendency to fill the morning gap so if you place the call at the same time and the market recovers the call side is going to take some heat The opposite should be done if it starts out with a gap up
So I am not sure how subjective can the backtester be or how it can be customized to only place a trade in only certain circumstances for the best outcome Otherwise if the backtester is just used to place a trade blindly regardless of the circumstances than I imagine the outcome will not be as good
Just a thought