LOL... I'm not so sure about the long term viability of this strategy. And especially so now that we have entered a cutting cycle which is almost always doomsday for the markets. If its so easy to make 50%, why isn't everyone doing it?
not many have a large account balance to buffer the drawdowns. the elaborate, margin required is for one side to enter, the opposite side is essentially margin "free". but do remember to roll into credit only if under.
this works out well, still holding, average price 2185... and i have eom covered calls at 2325, just around the high from the end of july i am also long 3 cl at average 72ish, still under the mark
I think that if mathematically the edge was there, it would be no problem for someone with a $1MM account to do this. But clearly, the risk of losing 50% is there.
rolll into credit trades only and wait for the rebound, time is on your side. the only downside is that you'd regret not bought the dip at the low, and double the money instantly on the rally however you can reserve some cash to buy the dip
I think maybe you got the wrong idea about my style as I'm pretty sure I already said that 120 points on a single day was an outlier day for me. I was simply an early short during a window of weakness and decided to press that one since I had a very early entry and high conviction of a sell. Generally, my aim is to exploit the daily range/day type shooting for relatively large moves relative to my risk. And that is in my view still a solid strategy as some days the range will be 20 points. Some days 50. Some days 100 +. They key is to not ask more than the day gives. For example, I want to avoid risking 5 points if I can't reasonably expect to get at least 10 points from it. Doesn't mean I will always get it of course. I had plenty of small green days lately where I simply called it a day as I didn't believe there was much more to expect and that I would be more at risk of losing due to poor conditions. That said, I have plenty of room for improvement. Specifically learning when not to trade and even skipping the day completely if I believe there's a range bound session coming up. I heard some day traders who would focus only on red folder days as they associate those with movement. It may not be a dumb idea. I recently reviewed some of the "Unknown Market Wizards" and a key theme among the three I was interested in reviewing was specifically the idea of learning to wait for the right day/trade and only press then. Don't waste your bullets (capital and mental energy) trading a poor market being depleted when the big opportunity comes.