Round Table - Boxcar Trade Update and How to Defend Against a Large Move to the Downside

[status1]

In the video presentation there was an update on the spreadsheet where the average Theta per day was added
This doesn't seem right to me or at least the label is misleading

It shows the remaining credit divided by the number of days left
Not sure how this correlates to Theta

Also this is a variable number and not an average so you can't assume that you will have this much p/l per day every day

Maybe it should be called P/L per day or something similar and not tied to Theta if it's not part of the calculation

 

[tom]

I could rename it. It is not an options Greek calculation but a rough guide of how much premium decay the put credit spread has per day on average. Maybe call it put spread average daily decay?

 

[status1]

Maybe call it put spread average daily decay?

That sounds a lot better but also it has to be known that this is not a constant value and it will change with the amount of profit or loss
That value is only good at that moment in time

 

[tom]

That sounds a lot better but also it has to be known that this is not a constant value and it will change with the amount of profit or loss
That value is only good at that moment in time

Yes. It does change as the price of the credit spread changes.