Without a doubt, that's the case. You can layer on more positions but push comes to shove, the market still has to cooperate. An example off the top of my head... Suppose you have an OTM calendar and the underlying drops just into the money quickly. Because time decay hasn't had a chance to work its magic, the position can incur a modest loss PDQ. If I thot the underlying was reversing, I might: 1) Roll the long leg in if it's further out than the 2nd month 2) If 2nd month, cover it (booking a profit) and buy the next just OTM front month leg, converting the calendar to a vertical. If the market cooperates, I make moire than I would have with the original calendar. If not, I get whacked even more. W/O actual numbers, I have no clue which has the better risk/reward. I do know what the better result is 3) Etc., etc. Anyway, I look at it as more of a dynamic process, particularly in things that you trade day in and day out. That's now 4 cents
probably correct. it all depends on how an individual defines a new trade (in his mindset), considering the degree of desired changes to be made from an initial state of reward/risk, capital-employment, cost, legs-complexity, time-to-exp, volatility-expectation, etc to another state (according to updated market conditions).