Improve Win Rate without Predicting or Timing

Getting both direction and timing right is very difficult. Most traders have a win rate between 35% and 45%. Even consistently profitable traders are typically wrong more than half of the time. What does that mean for you? If you are like a lot of traders, you may think that your win rate is the biggest problem you need to … Read More

Rhino Backtesting Report

Since releasing the Rhino options strategy last week, the number one topic of conversation is related to our 10-year study. Options traders are excited to see that rules which generated a strong profit in the 2008 bear market are also effective for runaway bull markets in later years. This type of out-of-sample data is very encouraging and one of the reasons the … Read More

How To Build Systems That Are Less Likely To Break

In the Options and Systems Workshop, we are discussing ways to improve the reliability of our trading. Three main themes of our weekly meetings include … Contrasting edges (e.g. expansion and reversion trades on at the same time) True diversification of exposure (low correlation of fundamental drivers)  Stress testing instead of optimizing (try to break strategies until you can’t — … Read More

Build a Better Options Trading Plan

The exercise of building an options trading plan is a very unique breed of business planning. We’ve found over the years that many options traders have career backgrounds as professionals or business owners. Traders with backgrounds like these often bring some of their old business planning tactics into their options trading plan. There are pros and cons to this. Pros … Read More

CL (Crude Oil) Options Trading

March 3, 2018 Andrew Falde SMB Options Desk Trader Yesterday in the Trading Conversations webinar, I was asked for an update on the SPX Netzero Options trades. It was perfect timing because a few minutes before the webinar started, I was approved to put my largest size on the SMB Options Desk into a CL (Crude Oil) Netzero. After mentioning … Read More

[Webinar Recording] “The Bearish Butterfly: Play to Win”

John Locke’s recent presentation “The Bearish Butterfly Trade: Play to Win” has now been posted. Traders find this strategy to be superior to selling calls or buying puts since the Bearish Butterfly trade can also profit in bullish markets. This makes the Bearish Butterfly an improvement over many forms of hedging which can limit upside or have negative expectancy. And by adding … Read More

Technical Analysis Benefiting Market Neutral Options Traders

What if you could adjust your market neutral trades before they are under pressure? This is exactly what many of the pro options traders on our desk are doing. Getting inside the market internals, watching price action, identifying levels… this isn’t just for day trading stocks. These skills can help you seriously improve your market neutral options spreads. We have two on-demand webinars available … Read More