Options Trading Signals
Mastering Range-Bound Trades:
Consistent Income with Options Trading
Our focus in our options trading is to maintain a consistent income stream, concentrating only on a few markets such as the SPX. We prefer a non-directional trading approach, primarily placing what are known as range-bound trades. Markets spend a significant portion of time in a sideways phase, which we capitalize on. Even when faced with unexpected movements, we can usually make adjustments to correct our positions, thus ensuring a high winning probability.
Our Results Explained:
Mastering Range-Bound Trades
At Traders Notebook, we believe in the power of consistency and adaptability. Our options trading strategy, focusing on range-bound trades, has yielded excellent results from January 2021 to December 2023. Here's how we achieved this success:
1. Non-Directional Trading Approach
We embrace a non-directional trading approach, placing what are known as range-bound trades. This strategy capitalizes on the fact that markets often move sideways for extended periods.
2. Adaptability and Flexibility
Unexpected market movements are inevitable, but our ability to make timely adjustments to correct our positions ensures a high winning probability. Our focus on a few key markets, such as the SPX, allows us to maintain a consistent income stream.
3. Capitalizing on Market Behavior
By understanding and leveraging the markets' tendency to spend significant time in a sideways phase, we've created a system that thrives in various market conditions.
Conclusion
Our results from January 2021 to August 2023 reflect our commitment to a trading strategy that is both robust and adaptable. By focusing on range-bound trades and providing comprehensive training and support, we've created a path to consistent income with SPX options trading. Join us on this journey and discover how our approach can work for you.
All results are hypothetical and are intended for illustrative purposes only. Past performance is not indicative of future results. Investing involves risks, including the potential loss of principal.
Questions and Answers
What markets do you trade?
We primarily trade the SPX, but occasionally we also include other liquid markets like CL (Crude Oil) to distribute the risk.
What size of trading account do you recommend?
We usually recommend a trading account of at least $25,000 due to FINRA regulations regarding the so-called 'pattern day trader'. It's important to understand that we are not day traders, and we typically hold positions for a few days. Therefore, you will be able to follow the trades even with smaller accounts. Most of our trades can even be executed using the SPY, which is only 1/10 of the SPX.
What platform do you use for teaching?
We can use Skype or Zoom, whichever platform you prefer.
Can you tell me more about the strategies you are using?
The strategies we use encompass a variety of well-known trading techniques, each tailored to different market conditions and investment goals. Here's an overview:
For Vega Long Trades:
- Calendars: Utilizing options with different expiration dates to capitalize on changes in volatility.
- Diagonals: Combining options with different strike prices and expiration dates.
- Double Calendars: A more complex version of the Calendar strategy.
- Double Diagonals or Double Long Diagonals: These strategies involve multiple options and are used to profit from volatility.
For Vega Short Trades:
- Butterflies: A neutral strategy that benefits from low volatility.
- Iron Butterflies: A variation of the Butterfly strategy using both calls and puts.
- Iron Condors: A strategy that involves four different options to create a balance between risk and reward.
Timeframes:
- Short-Term Strategies: We trade strategies with Days to Expiration (DTE) of only a few days, suitable for more active trading.
- Longer-Term Strategies: We also employ strategies with DTEs up to a month or even more, providing options for those looking for longer investment horizons.
Our approach is to carefully select the strategy that best aligns with the current market conditions. By leveraging these diverse strategies, we aim to provide flexible and robust trading solutions for various market scenarios.
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