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Hi, Ron. After studying and putting into practice the strategy selling -2, +3 put futures options, I wanted to ask you a question. As you know, the federal reserve has raised interest rates and expects to raise them 2 more times this year and 3 times more in 2019. Therefore, the S&P500 will foreseeably have a downward trend in coming years. This is not good news for the strategy, since it behaves better in bull markets. I intuit, and correct me if I'm wrong, that the closing of the positions will lengthen more time, and therefore also lower profitability (ROI). How could we modify the system so as not to lose profitability ?. Selling calls ?, Selling calls and puts at the same time? Any consideration?
Thanks for your invaluable help
Nobody knows what the market will be doing one hour, day, month, year from now with any certainty.
Raising interest rates does not mean S&P 500 will decrease. Fed rate increased from 2004 to 2007. S&P 500 went up during that time.
Selling ES calls is extremely low ROI and not worth it in my opinion.
The strategy I am using will work except during extreme drops like Fall 2008. Yes it will have lower ROI during some periods. But you need to just take what the market gives you. Trading this strategy is not for people that want excitement of making many trades. It's boring. It takes patience.
The Puts I SOLD on Jan 22. -2,+3(115 DTE) are down drastically this past 24 hours. I started with 10XIM. My question for Ron or any on else is would you consider openning a second trade for the same expiration date which will obviously lower the overall margin. overlapping trades.
So On Jan 22 i put on EWK3K8 P(-2)2230 and EWK3K8 P(+3)1940 x10 IM. Currently the MM is about3xIM. Since Futures are down I may be able to get a better ROI if I open ESM8 p(-1,+2) Delta 5 and 1.5 respectively. My first trade has 57 days to expiration and should start decaying faster. BY entering the June contract I am obviously reducing the total margin buffer on my account. My question is do you always close one before opening the next trade?
Thanks
I'm trying to use the spreadsheet to test a few things and am having problems with the month for futures and for options. I enter the start date as 01/02/2018 and hit "track select" for the following
Futures Month: ESM8
Options Month: EWJ8
This results in a big fat empty line. However when I do
Futures Month: ESH8
Options Month: ESH8
or
Futures Month: ESM8
Options Month: ESM8
it works. Just the number of days to expiration aren't where I need them to be. Any help would be most appreciated.
Not sure what happened but that same directory won't open again for the same reasons.... Can you ping them again or share the contact information so I can give them a call. I got January but only half of Feb. When I realized the FTP didn't finish the download I went back only to find the directory inaccessible again.
