I would like to run both strangles and a trend following system everyday since both have negative correlation. How do I design strangles in such a way, that in the morning I always sell strangles and then if move comes , automatically it converts to trend model. If market remains in a range throughout the day, trend model does not get used that day for ex- I sold 30000 call and 30000 put in the market open. I put a stop loss and if that SL is triggered, I will assume that market is trending and then run a trend model. What do you guys think about a system which works on a similar lines? Would love to have a discussion. Thanks
I think it’s pointless and not worth the time discussing because most such ideas get invalidated in backtests. Only after backtesting you can decide whether an idea is worth discussing, while 99.99% of the time you’ll end up spending lots of time adjusting and evolving an idea before you have something that’s worth considering seriously. In other words, your question could start with “how do I backtest any idea”. Maybe start with searching online and either find some tools for backtesting, or code your own, or hire someone to code it for you, etc.
Yes, I am a python coder and backtest my strategies before trading them. I would like to hear trading ideas.
You'll never hear of profitable trading ideas because they're too valuable, while the ones that aren't profitable are not worth anyone's time... But you already provided an idea (above) so backtest it, provide results, and then maybe discuss some ways to improve it?