Back at it – April

After what was a very rough period from Feb 2 to about last week, I am starting to recover and regain my ambition and motivation.

I had a rough go with IB margin rules during Volmageddon (Feb). They had implemented a 30x rule which basically summed up the total value of the options and if it exceeded 30x the value of your account, you had severe restrictions with adding new positions/contracts EVEN if they were risk reducing. During what was one of the biggest vol spikes and thee biggest change in volatility (VVIX) the option pricing sky rocketed across the board, and when summed up vastly exceeded 30x. It’s a ridiculous rule and it was an unknown rule. IF I had opposing positions where I sold a put at $5 and bought another put at 4.75 they would sum the position as 9.75 even though there was no substantial risk in that position. In the vol spike, options 10x or more so they’d be $50 and 97.50. This summation technique would put the account in violation of the rule. This gave me problems for when I had to roll or remove hedges. They also used some bizarre calculations that would restrict even further. This left me in a very precarious position where the complexity of removing hedges and positions was very difficult. I couldn’t get off my variety of hedges unless I literally liquidated the entire account which would have been impossible during those few days. I tried as best as I could to remove hedges and small parts of income positions but I just couldn’t get it done in time and the hedges collapsed in value and the STT remained compromised.

Anyways, I’ve been nursing these remaining positions since February and have recovered much of it but not all. I hope that maybe I can get to full recovery by May or June. That’s my year so far.

Suffice to say, I am working with new brokers and won’t be using IB for PM type trading (STTs, HS3s etc). I will also be moving my base trade towards HS3 type trades, STTs in higher vol down moves and John Locke style trades (M3, X4v17 and some BB) as a booster and to bring back some diversification in my trade plan. I still like ATM type trades. I remember when I had the Aug 24 crash with my MICs (this happened right when I was learning the Locke trades and was just initiating). Soon after I had recovered the entire loss from Aug within 4-5 months using M3s and BBs. Anyone that traded MICs, would know just how bad those did during Aug 24 2015. I liked trading those things (M3). I eventually switched to Rhinos and did modestly with them but I hate the upside exposure on runaway markets. Though, I mean, I did Rhinos during one of the biggest up moves in history in the RUT. No wonder I was frustrated with those.

Anyways, that’s my current situation and plan re trading.

I am in Canada now visiting the office and some family and friends. I will be back again for the Montreal Party Poker tournament and probably touring Europe again this summer. I’ll post more about those travels and the trading complications there-in.

STT initial draw downs

Thought I’d share some of the nuance of STT draw-downs during the past several days which I found interesting but expected after back-testing it to death. Always different live though isn’t it? In the last 18 months we haven’t really had large VIX spikes or bearish moves so it’s a nice refresher on how things actually work in real life re trading.

I had entered several June 29 STTs last week when VOL spiked quite high despite the move upward. VIX was telling us that demand for protection was increasing as the market moved up. Traders were protecting themselves. The STTs were a decent price given the pricing of OTM options so I used that to compliment the entries I had the weeks prior in the June 29 expiration. On Monday, the market fell and we had a spike to 15.3 VIX area. So we went from a 9 VIX environment a week prior to a 15 VIX environment. The move was relatively small in the SPX but the VIX move was quite large. That day, the market was hovering around SPY 281.5 with a touch of 281.22. About the same place it was the week before. However, the STTs I entered drew down about $550-$600 a unit which closed in on a 100k total draw down. Of course, these types of VOL based draw downs are temporary and they follow the VIX spikes you see in the charts. If you see a large spike, expect a temporary draw down, likewise, even if the market continues down, if the spike subsides, expect your STTs to regain in value. This type of thing is most pronounced with a move from a low vol environment to a higher vol environment and it will affect newer STTs more than developed STTs. Likewise, If we start entering STTs in this higher vol environment, they’ll be less prone to vol shifts. Anyways, it’s Thursday, and pre-market is down to about 280.6 area and my STTs are only drawn down about $250 a unit yet the market is lower than it was on Monday. Totally normal and give another 10 days, we’ll likely be green pending no disaster in the market. All the while, I’ll be entering more and more STT and setting the next several months up as a success. As time goes buy, the profit tent will build up and even with the market moving lower, the STTs will regain value and eventually, probably in the next 30 days, we’ll be reaching profit targets. If we have another shock event or a shock VIX spike, we’ll have draw down but it’ll likely be less than the initial one as time has gone buy and time builds resilience in the STT. Yesterday they were only down about 200 a unit. Totally normal following a large spike with brand new STTs. Again, time kinda cures all of this. Given another 10 days, it’ll be very hard for the STT to draw down this amount again unless we have an actual larger bear move that requires adjustments etc. The STT likes grind down markets and can handle a sudden move and it’ll often do really good if we can get a bit closer to that tent. Give it 30 days and we and very likely we’ll be green and in a sweet zone for further profit expansion.

This is a great environment to get into STTs and if we can keep this going, we’ll be laughing.

Those vix spikes are great times to enter more. I did. Now we let this move play out and adjust as we need (I usually add condors weight to the direction I need to hedge). I will at times add debit spreads as well.

I’ve converted old STTs (March) to hedge structures by selling some of the longs of the PDS and buying back twice as many of the shorts of the PCS as well I’ll buy back the PCS at cheap prices and sometimes sell a bit more of the front long to compensate etc etc. Credit to Rui @ the PMTT Group for the idea.

2018 Plan

Wow. What a run in the markets. Historic on all levels. We’ve now gone the longest time without a 5% pull back. The RSI is at historic levels. The thing just won’t die. I am just glad I never got caught in the run with a neutral or negative UEL (upper expiration line) this time around. A lesson learned from the last 18 months.

I think the biggest mistakes I’ve made as a trader in the last 24 months have been approaching or erring my adjustment and entry decision making based on a positive EV (expected value) basis. I used to be a professional gambler (finding exploits in casino games both online and to a lesser degree off) and was v. successful at it (go figure, you actually can do something like that for a living). My mindset in exploiting edges carried over to the markets and it never paid off. Probably more of a function of timing and extremes in market conditions than it was on poor analysis. For the last 18 months, records and extremes have been a normality. Using previous market mechanics to game that system would be impossible. I’d use lots of technicals and market bias where the EV seemed well positive to shape my trades to err one way or the other or to time adjustments. I don’t think I was ever right. Now don’t get me wrong, only a few times did it really hurt but the other times just affected my planned bias just a bit. Nothing major. It was just an “err” to slightly positive or slightly negative deltas. A bias.

For example, we’d reach a yearly pivot point and major resistance w/ VIX at lowest in history, I’d remove the credit spread and wait for a small pull back or a cessation in the up move to take off the debit spread. That happened in October and did affect my December trade, the market screamed through and went up enormous amounts. I managed to get my PDS off but at a pretty shitty price. That was the big one. My big mistake of the year. Cost some of the profits. What are the others? Well after a big run, I’d setup the STT in a more standard format where I’d have a neutral UEL or slightly negative with some negative deltas. The market kept going up and the STT would struggle to reach target. What else? I’d try to wait for a red day to get on a PCS for upside adjustments. They mostly never came. Obviously the market is in extremes and all of these are reasonable bias and they’re only erring bias but it never worked out.

I learned from that, and now follow a no-bias approach. I set my UEL positive and I adjust based on price action and risk profile. Now I have no stress or worry about a never ending bull market. I’ll reach targets on the trades and I won’t have much to do. Like now.

I’ve gone back to basics as my mastermind group starts to go further down the rabbit hole re skew calculations (horizontal and vertical) and trying to find edges there-in. The last month or so they’ve gone so far in that they’ve lost me even πŸ™‚ I think they’re exploring areas that are relatively untouched and I have no doubt that it will result in some quantifiable and actionable edges but a lot of it seems to be an exercise in complex analysis. But they will need to really simplify what they’re doing and it’d be for entries and adjustments. I am letting them run with this while I go back to the basics. My account size just can’t be put to use in anything but the simplest most predictable trades. The group is so invaluable and its the main reason I’ve been able to find myself in trading.

Right now, I’ve been setting up STTs much further out, a bit wider where I’d shrink the width as it ages and with the final intent to eventually convert all the STTs to a hedge structure as they approach the final 3 months. I’ve got my BSH factory running and I have other types of hedges. I’ve managed to get them to cost NIL while utilizing the STTs as a profit structure. Simple and easy. I haven’t messed about with exotic structures but eventually will on a very small non-concentrated amount.

I finally have moved into my new house and have an awesome office to work out of. It’s all coming together re trading.

2017 – The year of experimentation

This year has been a long year of experimenting and pushing the boundaries of complex option trading. I have come to realize that a good strategy has a triangle of requirements that need to be fulfilled to be a valid scalable trade. Namely, it has to satisfy 1) margin and margin expansion requirements 2) Slippage, fills and real life initiations of the trade 3)Good backtest results.

Pre 2017, backtests were generally good enough because everything was standard and because of this, generally, if it backtested well it would do well enough live. We used standard width PCS and PDS and combos therein, and generally putting those on were quite easy and can be done without much directional risks. IE putting on PCS then instantly putting on the PDS or even filling them as a condor or butterfly. Not a big deal.

This year, I got excited about a few strategies based solely on backtests,–> really good backtests. Almost ‘end game’ nothing else needed type of results. This specific trade required a high vol entry and I patiently waited for this entry in what ended up being the lowest volatility period on record, it didn’t come. Time was wasted from Sept-Nov. Then we had some red days and I licked my chops ready to get trades on, unfortunately, it was met with disappointment. Now, I did put on a few sample tests before but it was in relative low vol and the trade was OK to initiate in low vol as the market didn’t move much and I’ll get into why that ends up being important. Something I didn’t realize. The non-standard widths in the credit spreads were very very difficult to fill. It wasn’t low hanging fruit the market makers could understand and hedge. It was too exotic. Coupled with the PCS you had to initiate long puts that had some combos @ ATM and some OTM (the hedge portion). However, in a fast moving market these things move quickly. So there in lied the rub. IF you got filled on the long puts, there was no guarantee you could get filled on the PCS. Leaving you incredibly exposed. If you got filled on the PCS, it meant that the market was moving against your longs (the makers apparently called them STUPIDS) and you will pay a really bad price for the longs as they become high in demand. Filling this trade in size was a nightmare.

So some people had ideas about using ratios. I gave it a shot the next red day. Again, I had mega issues getting fills on this. It just was untenable. But I did manage to get on about 150 units of this trade through a lot of pain.

The backtests were great, it was the trade of all trades..but filling this live was a different story. It’s all easy when you just enter the trade and press commit in a backtest, not so easy in real life.

The next issue was margin, at first I didn’t have much margin issue at IB but as time went on, all of these seem to margin expand to abut 13-14k a unit! This made the trade almost untenable from a margin perspective. Gross use of capital. So not only did I have a nightmare fill situation but I had a nightmare margin situation. IB doesn’t take into account the full benefits of the longs below a certain delta (in this case our spread was so large that the margin hit from the short was not getting covered at all by the longs). This isn’t such an issue at Think or Swim but at IB it is.

So a dream trade from backtests became somewhat a nightmare trade from a margin and live slippage/initiation perspective. Lessons learned and 3 months of opportunity potentially wasted.

These things you just can’t know. And again, this year was a year of exploring every nuance of complex option trading and it ended my year at best break-even. But the year was the most successful year in growth as a trader and I feel there is not that many more stones to turn. We’re (my PMTT group) are approaching the apex of what’s possible with respect to the triangle of requirements in complex trades. Guess what? It’s gone pretty much full circle for me. I am actively trading STTs and variants of BSh factories and the last 1 month of doing this has produced great result. Now on to formalizing this as a base trade and putting capital to work with what is proven to work and not into nuanced complexities.

Here is the summary of how my year from memory:

1. Jan/Feb I still had on legacy Rhino structures that got smooshed from the incredible trump bull run. Remember these? They hate 4%+ up moves in a cycle. Love everything else. During this time I started testing the new STT/BSH stuff. I started off with BSH and waited as per the rules to finance with PCS on a down day. I think we had a 14 day bull run there with no opportunity to finance, this is extremely abnormal. Bad timing. So the BSHs put on lost money because they couldn’t be financed. Not a great start. The STTs obviously as they always do, did great.

2. March/April I start testing a combo trade I came up with called the PC2 and PC3. The PMTT group seems to like it as well. The tests were insane. Really good. But I miscalculated margin requirements and put the trade on the shelf. I documented this in the blog here even. Exciting stuff. Shelved due to miscalculating margin requirements (I entered each segment into IB and added the margin up). During this time, we used a method that tested very well but failed to deliver during this specific period as a way to finance the BSH. The BSH/STT combo broke even. During this time there was a cross expiration skew issue that kept the financing method from paying off the BSH costs. These are all legacy methods of financing that aren’t really used. Learning process. Backtests of the RC financing method did great. Just we had a bad period here…timing was poor.

3. May/June/July Extremely low volatility, RCs still not working, unable to really have opportunity to put on some good STT trades due to low vol. Start looking at PC2 again and do extreme testing and was aiming to present in September at the PMTT group. Basically broke even through this period. Poor pay off of the BSH. The PC2 had we started in April would have been hitting profit target every single month this year! The financing method is built into the PC2. Unfortunately, I calculated margin wrong and didn’t initiate, instead I used RCs which just did not pay off the cost of the BSH and we were slightly profitable but more or less break even during this period. Maybe up 7%?

4. Aug I entered some T5 (just about 40k worth). Along with most of the group. This was a juicer trade, a trade meant to pick up our returns. It is the most POSEV trade but its got variance. Variance I can accept though. We entered and experienced one of the worst skew issues you could imagine due to the NK missile issues. Vol sky rocketed in January options but not so much in earlier expirations. This caused massive draw down. Most of which was eventually recovered through October. But this was the highlight of August. Also during this time, I realized error of margin re PC2 and started heavy heavy testing and was ready to deploy a mastermind session in September.

5. Sep The HS3 and Fulcrum ideas come out. They tested so well. Dream like almost. Read the beginning of my blog post for more info. It needed high vol entries. Vol was extremely low and historical. We wait patiently for opportunities.

6. Oct Market runs up, I took off some Dec PCS in what was record low vol, with intent to get off PDS next day or so on any slow down. Again, the market gapped up like 1-2% and I destroyed my Dec STT profitability and actually went negative.

7. Nov I decide to enter moderate size of Rhinos thinking we’re apex’ing and unlikely to experience sustained and large up moves. That was wrong, Rhinos were exited at fairly big loss.

8. Dec I finally put live all the good core trades, they do great and recover a lot of the losses from before. STT, PC2 and BSH factory is producing great returns. Onward into 2018 this will be the core.

The interesting thing about all this is that the complexity of all these strategies is solely based on how to hedge them from risk. it’s not about seeking out max EV or anything like that. I say max EV because seeking out max hedge is equivalent to maximizing profit at least from a risk perspective. Max EV trades are trades that have the highest expectancy and this can be without regard to variance. The highest EV trade I know of is called the T5 which is taught in the PMTT Mastermind group.

Anyway. That’s a sum of the year. You can see it was a lot of experimenting and backtesting and trial. In the summer, I was backtesting an average of 4 hrs a day on 20 or so new variants of strategies. Though I may still be backtesting going forward, the core bulk of cash will be put to work in combos of STT and self financed BSh. The STT always produces, it did though 2017, it was the BSH not getting financed that caused the meh results. THat’s solved. Excited to see how this thing does through the year.

More to come.

2017 Results Table

Below is a snippet of the 2017 results with time slices to see relative draw downs across all three trades.

The RED defines when we’d have exited for the trade but sometimes I tracked what if we hadn’t. I don’t even see a drawdown for the HS1 in 2017 (short of the -209 on the Jan 19th trade).

I will be testing the HS1 in random entries as well to see how the DIT changes and how bad draw-downs can get.

New Trade Results

I’ve been backtesting 3 variants side by side from 2014-2017 w/ entry during a SPX down day of at least 0.5% and a corresponding VIX spike. The High vol entry makes the management of the trade much easier, the more the spike and down, the easier it is to manage. I’ve been testing the HS1, HS2 and the new fulcrum trade . I am not done yet but it’s close. I will be presenting at a mastermind next week and will be talking about the trades and its results.

So far I’ve not had a loser for the HS1 variant which I manage in a specific way. The drawdown has been less than 400 a unit as well. Very very good. The average days in trade is about 48 so far and the return is about 12.5%. The more higher VOL entries will sometimes get to profit in 8-14 DIT especially in more bearish conditions. Beautiful trade.

Here’s what it looks like at initiation:

Despite what it looks like to the left, in a black swan event, it will pick up and handle it just fine if not at a profit.

Here’s a few of the trade initiated around Aug 24 crash date:

Aug 20, 2015 ENTRY

Aug 21

Aug 24 Crash day


Despite the left side, it does pick up and reach profit target on the 21st AND almost double the profit target on the 24th.

The market moved from 2035 to 1890 and it did just fine.

The same goes for the Jan 2016 slow bear move down. It just crushes.

Yep, it’s a game changer. Horny Communist!?

Spent most of the day backtesting and working with the group on slight tweaks to the new trade as well I looked at parameters for adjusting, profit taking, margin expansion and so on. (Some tweaks are basically using different synthetics to better the greeks and so on IE you can short the market directly or you can create the same thing with a short call and long put at the money. But you then have some benefits re VEGA (vol) if the market falls re the long put) So you play with that stuff to get a better reacting trade while keeping the profiles relatively the same..long story short—>Buh-Bye STT and BSH. This thing is it. I’m saying hi to an old friend named optimism. I was down in trading mood this week and It think it showed. I guess at the same time, I mean, I didn’t have my combos on yet (PC2) and I was still struggling with the financing and so on which there was a light at the end of the tunnel. I just wasn’t feeling it. Now I am.

Like I said in the previous posts and above which might not have been obvious, the bulk of my current trading portfolio was still in individual BSHs, STTs and financing there in, NOT combos. A true struggle it was for me. I had not gone live with combos yet (not with any large amount). Had I, it would be just fine (not close to as good as the new stuff, but good). So I’m still old school and am suffering with poor profits from being unable to finance the BSHs in this environment. My reverse calendar financing DID not do well, my NPs were barely existent in some of my BSH financing and my STTs are suffering from bizarre option skews (OTM puts holding value). This whole thing was kinda a mess and resulted from a lot of things not going my way. Still, I am profitable, I just sucked.

So right now, I mostly kept backtesting the new parameters (when do we take profit, what if we move an option here or there and so on and playing with all sorts of dates to see how to setup the profit taking in the trades and to get a feel for draw-downs and so-on. I couldn’t keep up with the developments in the group and in the trade itself re parameters. So I probably backtested this thing in various small forms across every date possible πŸ™‚ It’s using very familiar parts that I’ve traded a millions times before, so it’s not as if its going to do something unexpected but still diligence is required. I think we’ve nailed it now.

I’ll have a solid basket of 5-6 trades all working together and I am going to go live this upcoming few weeks. I’ll be going from the cumbersome financing BSHs, STT mess skipping over the combos and into the efficient versions of said combos that have accomplish the same things with elegance and ease w/ better profiles and greeks. The key thing is these things will be a blessing to manage. Looking forward!

The title had Horny Communist in it. That might be the name of the trade variant as a member noted that the Leftie tent was so big, he kept thinking of lefties/commies and we added a small tiny horn at the front (stolen from the Rhino trade) hence the name Horny Communist :). I kinda like it. This trade mixes ATM style properties but with built in black swan protection.

Sep 13 Update

Not a whole lot going on,

On the super low vol pump up during the last 13 days, I did enter a bunch of BSHs and set and enter much of the Jan STT at a higher UEL on the one down day we had. So the higher UEL is helping financing some of the BShs but not completely and I wait for ANY return of vol to get them paid off. When will this period end? This is the last time I work BSHs like this. I will enter a BSH factory and do opportunistic STTs, Sails and T5s. I just suck at financing these things.

My year is pretty crappy, I’m positive but it must be around 10% or so max thus far. I guess I can’t complain but I feel like I am just waiting for some sort of vol to happen so I can get out of my Dec STTs and start entering all the new setups I have (which all require some volatility to enter). The whole year went to shit re returns from the original Rhinos I had on in Jan-Mar and my poor payoff of BSH financing (RC’s didn’t work well enough and my over-patience for high vol entries of NPs didn’t go as planned). All of the poor performance is to do with my poor financing and using archaic strategies that we no longer use (it was all we had at the time). I attribute this year as a final year to my on-going learning and setup of the dream trading portfolio πŸ™‚ If I can’t break 50% next year, I will question everything. I know that sounds crazy.

I did put on a small Rhino the other day but the up move has it in negative currently. I am still trying to get out of my T5 which I am seeing some value come back in.

As I mentioned, I am convinced that a BSH factory is a great core trade and pairing it with some opportunistic STTs, some Sail trades (High Vol entries and trend following entries with bias) will be the move going forward. I’ve been backtesting it like mad and I am getting crazy returns on any date I enter for the BSH factory, within 6 months or so. It’s a great income trade, but I can only use a fraction of the account on it re initial risks at the beginning. We have exposure for like 10-20 days. I will likely try to tool old structures I have on to compensate this risk so I can put on more and more.

I am back in Cayman now, boredom is starting to set in more regularly but I am getting a lot more work done πŸ™‚

Aug 3 – Trade update and plan for the year

I’ve just arrived to Arona, the final leg of the trip with my family. The last 2 road trips, we use this as a rest and catch-up stop (so I’ll be backtesting and working like mad). There’s not much else to do but that πŸ™‚

I’ve had a very slow summer re P/L as the market has been the lowest vol possible and I am a net seller of premium and premium hasn’t been cheaper πŸ™‚ I’ve been sidelined a lot waiting for high vol entries for the STT and it’s never come. The trades on entry do prefer a higher vol (STT) and while the BSHs love a low vol entry, I’ve been using RCs to pay for them but it’s not keeping up on the pay-off. I try to have a positive UEL on the STT at initiation to compensate but I haven’t put on enough STTs! So I have too many BSHs to STTs right now as I am sure most of us do. You put these things on in low vol and get them paid for so that when you get your higher vol entry for an STT, you’re nice and hedged. I wait for two days of vol or down days to get into additional PCS to help pay for them OR I set the STT at higher UEL (basically same thing as adding PCS right) but we just haven’t had that. It’s incredible really. Frustrating market. So in essence, the market has been pretty much the worst for the trades…at least the worst ‘now’ seems to be just slow profit. On Jul 27th, we had a single large vix spike and down day and the balances jumped super high, I liked that..but it lasted a few hours lol. I am sure vol is coming soon..just waiting it out. My Dec trades have a negative UEL right now and I am waiting for one larger down day to get that fixed..maybe I should just do it soon..vol is so cheap though, I’d be getting paid crap πŸ™‚ The trials and tribulations of decision making. The combo trade I am discussing below should fix all of this for me.

    Combo Trade

I’ve been developing a combo trade that can be put in on ANY market type and will profit an average of 8.5% on margin per 45 day period (and I haven’t seen a loss in 30 months of backtesting). I had previously posted returns for one version of it on this blog. I’ve tweaked it a bit and and am finishing it up and will post those results as well. I think the mastermind group is dedicating 1.5 hours next week to investigating and talking about the combo trades. I am very hopeful that this is the base trade going forward, it’s not had a loss yet in backtesting and survives Aug 24 w/ large profit.

I’d probably slap them on via the IB desk as one large order. It’s completely hedged in a black swan and can be scaled high. The average draw down is ~$700 per unit(very rare) and the profit target is $350.

I’ve been testing this combo since May in various forms and I had abandoned it when I incorrectly calculated the margin in May. Stupid mistake. Had I not, I’d have had them on for the summer most likely and they’d have reached profit target. Instead, I was doing STTs, BSHs and RCs separately. I’ve done poorly paying off the BSHs via the RCs due to the environment and I’ve got caught with the STTs a bit with negative UEL issues waiting for a down day. Frustrated but I have to wipe the slate clean and start fresh for the year though and get these combos and 555s going and aim to close off the year with good profit.

    Returns

As mentioned, it does about 8.75% on margin per 45 day period. So its a 6% a month trade but we always have 35% of our balance available so it’s more or less like a 4.5% return per month nen-compounded. That said, I am mixing in 10% of the account with the TTT(555) trade which reduces margin drastically thus boosting that return on margin and also provides really good returns in and of itself. The plan is to go live with the PC2 and TTT(555) trade soon and start bringing in the returns that’s been lacking this year so far as this exploration and trial for finding the perfect trade starts coming to an end ‘ish.

    TTT(555)

The TTT(555) trade was developed by Ron (Trading Dominion) and was a take on a previous trade that took advantage of skew dynamics across expirations. Essentially selling the part of the curve that at it’s highest and buying the part of the curve at it’s lowest across expirations. The margin requirement is the minimum and if you have other trades like the STT on, it would actually reduce overall margin heavily. The average days in trade is 10 and the profit is typically 100% of margin in 10 days (about 67% of the time) and the other 33% of the time you lose similar. The equity curve from 2015-to date was 1k turning into 22k. Incredible returns. For more information, join the mastermind group! If it isn’t obvious, I am just a member, I don’t make anything from the recommendation except hopefully leveraging the ideas you add to the group πŸ™‚ Ron only charges I think $30 a month to keep the lights on for the group (site, organising the mastermind sessions etc).

Here’s the direct link to extra details about the course dealing with the Space Trip Trade, Foundations, and the Black Swan Hedge. Once you get through that, join the mastermind and that’s were we’re discussing all these trades. Invaluable.

https://academy.tradingdominion.com/pmtt/

Jul 19 – Trading Plan STT + BSH

A confluence of resistance is at ES 2475 (Yearly and weekly resistance pivots) and there’s a 77% chance of a new high according to Cobra so I gather that’s the target. Typically once it touches the yearly pivot it’ll move go down to the yearly support. IMO it’s not the time to add long positions. We have the confluence of resistance and we always have big pullbacks in Aug,Sept or October of 5-10%. W/ Vix at 9.8, it doesn’t feel like risk is being priced properly. I have only about 25% of margin used right now as I removed lots of Sept PCS and with the VIX at 9.8 I just can’t justify getting into new STT positions just yet. It doesn’t makes sense from a margin perspective either. If the market doesn’t move down at all, it could be a slow summer of returns for me. I’ll be looking at adding more GA trades and maybe some mechanical combos of the STT trades. And like I said, on any decent pullback, I’ll add some STTs so I can get the account maximised. I’ll also be entering in new BSHs w/ RCs until I can get this factory fully formed.

We leave tomorrow for Gdansk and we’ll start making our way by car towards Arona, Italy, we’ll stop in Poznan, Berlin, Bamberg and likely somewhere in the Alps before reaching Italy. We will spend 7 days in the B&B and another 4 days somwerhe else and the family trip will be over. I then meet friends from Aug 11-20 for a small guys trip and on Aug 20 I play 7 or so poker tournaments in Barcelona and call it a summer!