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The month isn't over so I don't want to jinx myself, but as it stands right now, I have gotten a little better each month for the past 7 months. Potentially three straight months of profitability if everything stays upright for the next ten days.
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Do you select your strikes based on specific parameters of the greeks, OI, volume, price?
First and foremost is the spread. If the spread isn't tight, there is a high likelihood of slippage and of me getting stopped out before the underlying breaks resistance/support so I always want a tight spread, no more than 1-3 cents apart most times. Next most important thing is the delta. I want a delta of .85 or greater unless the PPS is very big. That wayI can set my stops just like I would for the stock itself without worrying about theta or the other greeks
In a less liquid underlying do you opt for outright purchases or still verticals? (considering the 'double' bid-ask spread of the option you need to buy and close)
I use verticals for +$100 PPS stocks like AMZN/AAPL. For the most part nowadays, I steer clear of less-liquid options. I generally use (diagonal) verticals when I expect the market to move sideways for a while before it moves higher/lower. Now would be a good time for example, as I would expect the SPY to retest $174 and then consolidate or fail on a quick breakout
How often do you trade the outright calls or puts vs verticals. (the verticals can cap alpha and/or do not capture full value due to timing?)
Like I mentioned before, I use verticals when I expect sideways action. Also another reason is if the IV is very high but I don't want to pass up on a chart. I would buy some ATM options and then sell some DOTM options for profit since the IV is so high.
Anyways, today is sucky so far. Stopped out of all of my positions except STP. Down like $800 or so intraday. No new positions on the chopping block right now, might throw a spread on tomorrow or after the weekend.
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