Hi, What do you call a 7% edge, exactly? Is that the mathematical expectancy of your system, per trade, for instance?
Should have specified but I admit I deliberately left it ambiguous. It's a probability edge in predicting a change in implied volatility. Like VolSkewTrader said, it's much easier to predict direction of implied volatility. Volatility seems to be decreasing some 55% of the time (I think this can be explained as in it tends to jump up rapidly but it takes more time to calm down). So let's say I want it to increase some amount (not just "increase" but "increase by at least so much"), it happens so randomly some 35% of the times but if I add my indicator, it's up 42% of the time. So is it possible to do something profitable with such info? When volatility increases, prices go up, so I'd buy an option one day then sell it the other day. But there's theta which makes it lose value, plus the change in underlier. So maybe buy a delta-neutral call/put pair at the money then if the vol goes up enough sell it the next day for a profit. I can test the hypothesis but can tell you upfront that it won't work so funk it. Need to find something more elaborate to actually make money.
In 2019 - 2020, I made 147% swing trading ETFs. I tweeted every trade BEFORE I did it, and I documented every trade in a spreadsheet. In June, 2020, I started another run, again tweeting every trade BEFORE I do it. So far, I'm up 36% since June, 2020. @RandomFour