{"id":40420,"date":"2015-04-07T20:49:21","date_gmt":"2015-04-08T00:49:21","guid":{"rendered":"http:\/\/www.smbtraining.com\/blog\/?p=40420"},"modified":"2023-06-08T12:01:10","modified_gmt":"2023-06-08T16:01:10","slug":"how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy","status":"publish","type":"post","link":"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy","title":{"rendered":"Turning a Bad Signal into a Winning Trade with the Right Strategy"},"content":{"rendered":"<p>Here is a case study in accumulating as many edges as possible to increase your risk adjusted returns. In the past, I have shared that most developing traders start by looking for the fastest way to make bigger profits.<\/p>\n<p>However in systems development we look for the highest <strong>risk adjusted<\/strong> returns.\u00a0In this example trade, we are going to combine two theoretical edges and look for both to add value. In the example, only one of the edges is going to work for us.<\/p>\n<p>Edge #1 &#8211; Time Decay of Options<\/p>\n<p>An Iron Condor is a simple options trade that benefits most in the underlying instrument stays in a tight range. The risk is if a strong trend develops and moves outside of the range of our options profile.<\/p>\n<p>Edge #2 &#8211; A Valid Momentum Signal<\/p>\n<p>The TEA indicator is a robust\u00a0trend\/momentum signal that helps identify early shifts in the direction of the market without overreacting to short term noise.<\/p>\n<p>Here is a simulated P\/L of the TEA indicator on the $RUT (Russel 2000 Index). The red circle represents the trade we are going to analyze. As you can see, this is a losing trade. So, now that I&#8217;ve given away which component of the system is going to fail in our sample&#8230; let&#8217;s move on.<\/p>\n<p><em>(Trades are hypothetical; simulated using historic market data)<\/em><\/p>\n<p><a href=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/RUT-Options-Trading-Signal-iron-condor-trend-management.png\" target=\"_blank\" rel=\"noopener\"><img loading=\"lazy\" decoding=\"async\" class=\" alignnone wp-image-40422\" src=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/RUT-Options-Trading-Signal-iron-condor-trend-management-1024x509.png\" alt=\"RUT-Options-Trading-Signal-iron-condor-trend-management\" width=\"628\" height=\"312\" srcset=\"\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/RUT-Options-Trading-Signal-iron-condor-trend-management-1024x509.png 1024w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/RUT-Options-Trading-Signal-iron-condor-trend-management-300x149.png 300w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/RUT-Options-Trading-Signal-iron-condor-trend-management.png 1192w\" sizes=\"auto, (max-width: 628px) 100vw, 628px\" \/><\/a><\/p>\n<p>Here is a chart of the market during this trade. As you can see, the signal identified the early part of the move, but the correction was too quick to get us out with a profitable signal. NOTE: I said the Signal wasn&#8217;t profitable &#8212; but we are going to see how the Trade works out soon enough. The red dashed line represents the entry and exit points.<\/p>\n<p>The TEA indicator are the green, yellow, and red dots. We enter after the first green dot closed, and exited after the first yellow dot closed.<\/p>\n<p><a href=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/2015-4-7-bad-signal.png\" target=\"_blank\" rel=\"noopener\"><img loading=\"lazy\" decoding=\"async\" class=\" alignnone wp-image-40423\" src=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/2015-4-7-bad-signal-1024x493.png\" alt=\"RUT-options-trade-options-theta-iron-condor-management\" width=\"648\" height=\"312\" srcset=\"\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/2015-4-7-bad-signal-1024x493.png 1024w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/2015-4-7-bad-signal-300x144.png 300w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/2015-4-7-bad-signal.png 1859w\" sizes=\"auto, (max-width: 648px) 100vw, 648px\" \/><\/a><\/p>\n<p>If we traded an Iron Condor with no trend defense from the signal, the trade would have looked like this.<\/p>\n<p>Entry: Starting at P\/L of 0% &#8212; We have an equal amount of spreads on the call side and put side of the market.<\/p>\n<p><a href=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Balanced-at-open.png\" target=\"_blank\" rel=\"noopener\"><img loading=\"lazy\" decoding=\"async\" class=\" alignnone wp-image-40424\" src=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Balanced-at-open-1024x513.png\" alt=\"Balanced at open\" width=\"748\" height=\"375\" srcset=\"\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Balanced-at-open-1024x513.png 1024w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Balanced-at-open-300x150.png 300w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Balanced-at-open.png 1365w\" sizes=\"auto, (max-width: 748px) 100vw, 748px\" \/><\/a><\/p>\n<p>Then at the run up point we have a P\/L draw down of -7.54% &#8212; and we are looking at a very steep curve with a lot of risk if the market continues to run up.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\" alignnone wp-image-40425\" src=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Balanced-at-high-1024x511.png\" alt=\"Balanced at high\" width=\"756\" height=\"377\" srcset=\"\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Balanced-at-high-1024x511.png 1024w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Balanced-at-high-300x150.png 300w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Balanced-at-high.png 1365w\" sizes=\"auto, (max-width: 756px) 100vw, 756px\" \/><\/p>\n<p>At the exit point of the signal, the trade ends at a P\/L of +10.14% &#8212; Whew!<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\" alignnone wp-image-40426\" src=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Balanced-at-close-1024x514.png\" alt=\"Balanced at close\" width=\"764\" height=\"384\" srcset=\"\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Balanced-at-close-1024x514.png 1024w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Balanced-at-close-300x151.png 300w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Balanced-at-close.png 1366w\" sizes=\"auto, (max-width: 764px) 100vw, 764px\" \/><\/p>\n<p>Now, here&#8217;s a Ratio Iron Condor where we reduce our risk in the direction of the identified trend\/momentum that the TEA indicator is representing.<\/p>\n<p>At the open of the trade, you can see the reduced risk on the call side of the market. Starting P\/L is 0%<\/p>\n<p><a href=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Reduced-Call-Side-at-open.png\" target=\"_blank\" rel=\"noopener\"><img loading=\"lazy\" decoding=\"async\" class=\" alignnone wp-image-40427\" src=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Reduced-Call-Side-at-open-1024x514.png\" alt=\"RUT-Options-Trade-Ratio-At-Open-SMB-Capital\" width=\"756\" height=\"380\" srcset=\"\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Reduced-Call-Side-at-open-1024x514.png 1024w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Reduced-Call-Side-at-open-300x151.png 300w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Reduced-Call-Side-at-open.png 1361w\" sizes=\"auto, (max-width: 756px) 100vw, 756px\" \/><\/a><\/p>\n<p>At the top of the run up, the P\/L is actually at a positive 1.31%<\/p>\n<p><a href=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Reduced-Call-Side-at-high.png\" target=\"_blank\" rel=\"noopener\"><img loading=\"lazy\" decoding=\"async\" class=\" alignnone wp-image-40428\" src=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Reduced-Call-Side-at-high-1024x512.png\" alt=\"RUT-Options-Trade-Ratio-At-High-SMB-Capital\" width=\"760\" height=\"380\" srcset=\"\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Reduced-Call-Side-at-high-1024x512.png 1024w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Reduced-Call-Side-at-high-300x150.png 300w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Reduced-Call-Side-at-high.png 1365w\" sizes=\"auto, (max-width: 760px) 100vw, 760px\" \/><\/a><\/p>\n<p>The options system being shown here is approaching an adjustment point to allow for the market to move up even further without threatening the trade. If the market were to continue up rather than mean reverting, the original &#8220;balanced&#8221; iron condor would have created a big draw down.<\/p>\n<p>So, our ratio trade is respecting the trend, it&#8217;s positioned well for retracement, and benefiting from time decay.<\/p>\n<p>Then we end the trade below our initial entry point&#8230; but with a profit of 3.8%.<\/p>\n<p><a href=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Reduced-Call-Side-at-close.png\" target=\"_blank\" rel=\"noopener\"><img loading=\"lazy\" decoding=\"async\" class=\" alignnone wp-image-40429\" src=\"http:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Reduced-Call-Side-at-close-1024x513.png\" alt=\"RUT-Options-Trade-Ratio-At-close-SMB-Capital\" width=\"758\" height=\"380\" srcset=\"\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Reduced-Call-Side-at-close-1024x513.png 1024w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Reduced-Call-Side-at-close-300x150.png 300w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/Reduced-Call-Side-at-close.png 1365w\" sizes=\"auto, (max-width: 758px) 100vw, 758px\" \/><\/a><\/p>\n<p>This is an example of a trade that made less&#8230; but it&#8217;s the trade I&#8217;d pick 100% of the time. It had No draw down and ended with a profit on a bad directional signal.<\/p>\n<p>Do you have questions about this trade, the TEA indicator, or combining multiple edges to increase your risk adjusted returns?<\/p>\n<p>-Andrew Falde<br \/>\nSMB Training<\/p>\n<p><a href=\"http:\/\/www.cboe.com\/resources\/intro.aspx\" target=\"_blank\" rel=\"noopener\">Options Risk Disclaimer<\/a>.\u00a0No relevant positions.<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Here is a case study in accumulating as many edges as possible to increase your risk adjusted returns. In the past, I have shared that most developing traders start by looking for the fastest way to make bigger profits. However in systems development we look for the highest risk adjusted returns.\u00a0In this example trade, we are going to combine two &#8230; <a href=\"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy\" class=\"more-link\">Read More<\/a><\/p>\n","protected":false},"author":1039,"featured_media":40421,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2063,1937],"tags":[2255,3018,3710,1259,2517,18,76],"class_list":["post-40420","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-smb-options-2","category-systems-trading","tag-income","tag-iron-condor","tag-management","tag-options-trading","tag-rut","tag-smb-capital","tag-training"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.1.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Winning Trade Strategy: Overcoming Bad Signals | SMB Training<\/title>\n<meta name=\"description\" content=\"Learn how a bad signal can lead to a winning trade with the right strategy. Reduce your trading risks!\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Winning Trade Strategy: Overcoming Bad Signals | SMB Training\" \/>\n<meta property=\"og:description\" content=\"Learn how a bad signal can lead to a winning trade with the right strategy. Reduce your trading risks!\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy\" \/>\n<meta property=\"og:site_name\" content=\"SMB Training Blog\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/smbcap\/\" \/>\n<meta property=\"article:published_time\" content=\"2015-04-08T00:49:21+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-06-08T16:01:10+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/andrew-falde-conference-room.png\" \/>\n\t<meta property=\"og:image:width\" content=\"961\" \/>\n\t<meta property=\"og:image:height\" content=\"539\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"author\" content=\"Andrew Falde\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@smbcapital\" \/>\n<meta name=\"twitter:site\" content=\"@smbcapital\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Andrew Falde\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"5 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy\"},\"author\":{\"name\":\"Andrew Falde\",\"@id\":\"https:\/\/www.smbtraining.com\/blog\/#\/schema\/person\/cf351af6828c3fc8f9d9067daef8b764\"},\"headline\":\"Turning a Bad Signal into a Winning Trade with the Right Strategy\",\"datePublished\":\"2015-04-08T00:49:21+00:00\",\"dateModified\":\"2023-06-08T16:01:10+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy\"},\"wordCount\":644,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\/\/www.smbtraining.com\/blog\/#organization\"},\"image\":{\"@id\":\"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/andrew-falde-conference-room.png\",\"keywords\":[\"income\",\"iron condor\",\"management\",\"options trading\",\"rut\",\"smb capital\",\"training\"],\"articleSection\":[\"SMB Options\",\"Systems Trading\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy\",\"url\":\"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy\",\"name\":\"Winning Trade Strategy: Overcoming Bad Signals | SMB Training\",\"isPartOf\":{\"@id\":\"https:\/\/www.smbtraining.com\/blog\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/andrew-falde-conference-room.png\",\"datePublished\":\"2015-04-08T00:49:21+00:00\",\"dateModified\":\"2023-06-08T16:01:10+00:00\",\"description\":\"Learn how a bad signal can lead to a winning trade with the right strategy. Reduce your trading risks!\",\"breadcrumb\":{\"@id\":\"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy#primaryimage\",\"url\":\"https:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/andrew-falde-conference-room.png\",\"contentUrl\":\"https:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/andrew-falde-conference-room.png\",\"width\":961,\"height\":539},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/www.smbtraining.com\/blog\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Turning a Bad Signal into a Winning Trade with the Right Strategy\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/www.smbtraining.com\/blog\/#website\",\"url\":\"https:\/\/www.smbtraining.com\/blog\/\",\"name\":\"SMB Training Blog\",\"description\":\"Lessons from the trading desk\",\"publisher\":{\"@id\":\"https:\/\/www.smbtraining.com\/blog\/#organization\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/www.smbtraining.com\/blog\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\/\/www.smbtraining.com\/blog\/#organization\",\"name\":\"SMB Training\",\"url\":\"https:\/\/www.smbtraining.com\/blog\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.smbtraining.com\/blog\/#\/schema\/logo\/image\/\",\"url\":\"https:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2022\/07\/Logo-e1658419502954.png\",\"contentUrl\":\"https:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2022\/07\/Logo-e1658419502954.png\",\"width\":230,\"height\":81,\"caption\":\"SMB Training\"},\"image\":{\"@id\":\"https:\/\/www.smbtraining.com\/blog\/#\/schema\/logo\/image\/\"},\"sameAs\":[\"https:\/\/www.facebook.com\/smbcap\/\",\"https:\/\/x.com\/smbcapital\",\"https:\/\/www.youtube.com\/user\/smbcapital\"]},{\"@type\":\"Person\",\"@id\":\"https:\/\/www.smbtraining.com\/blog\/#\/schema\/person\/cf351af6828c3fc8f9d9067daef8b764\",\"name\":\"Andrew Falde\",\"sameAs\":[\"http:\/\/lessthanrandom.com\/\"],\"url\":\"https:\/\/www.smbtraining.com\/blog\/author\/afalde\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Winning Trade Strategy: Overcoming Bad Signals | SMB Training","description":"Learn how a bad signal can lead to a winning trade with the right strategy. Reduce your trading risks!","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy","og_locale":"en_US","og_type":"article","og_title":"Winning Trade Strategy: Overcoming Bad Signals | SMB Training","og_description":"Learn how a bad signal can lead to a winning trade with the right strategy. Reduce your trading risks!","og_url":"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy","og_site_name":"SMB Training Blog","article_publisher":"https:\/\/www.facebook.com\/smbcap\/","article_published_time":"2015-04-08T00:49:21+00:00","article_modified_time":"2023-06-08T16:01:10+00:00","og_image":[{"width":961,"height":539,"url":"https:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/andrew-falde-conference-room.png","type":"image\/png"}],"author":"Andrew Falde","twitter_card":"summary_large_image","twitter_creator":"@smbcapital","twitter_site":"@smbcapital","twitter_misc":{"Written by":"Andrew Falde","Est. reading time":"5 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy#article","isPartOf":{"@id":"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy"},"author":{"name":"Andrew Falde","@id":"https:\/\/www.smbtraining.com\/blog\/#\/schema\/person\/cf351af6828c3fc8f9d9067daef8b764"},"headline":"Turning a Bad Signal into a Winning Trade with the Right Strategy","datePublished":"2015-04-08T00:49:21+00:00","dateModified":"2023-06-08T16:01:10+00:00","mainEntityOfPage":{"@id":"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy"},"wordCount":644,"commentCount":0,"publisher":{"@id":"https:\/\/www.smbtraining.com\/blog\/#organization"},"image":{"@id":"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy#primaryimage"},"thumbnailUrl":"https:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/andrew-falde-conference-room.png","keywords":["income","iron condor","management","options trading","rut","smb capital","training"],"articleSection":["SMB Options","Systems Trading"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy#respond"]}]},{"@type":"WebPage","@id":"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy","url":"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy","name":"Winning Trade Strategy: Overcoming Bad Signals | SMB Training","isPartOf":{"@id":"https:\/\/www.smbtraining.com\/blog\/#website"},"primaryImageOfPage":{"@id":"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy#primaryimage"},"image":{"@id":"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy#primaryimage"},"thumbnailUrl":"https:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/andrew-falde-conference-room.png","datePublished":"2015-04-08T00:49:21+00:00","dateModified":"2023-06-08T16:01:10+00:00","description":"Learn how a bad signal can lead to a winning trade with the right strategy. Reduce your trading risks!","breadcrumb":{"@id":"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy#primaryimage","url":"https:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/andrew-falde-conference-room.png","contentUrl":"https:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2015\/04\/andrew-falde-conference-room.png","width":961,"height":539},{"@type":"BreadcrumbList","@id":"https:\/\/www.smbtraining.com\/blog\/how-a-bad-signal-can-lead-to-a-winning-trade-and-reduced-risk-with-the-right-strategy#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.smbtraining.com\/blog"},{"@type":"ListItem","position":2,"name":"Turning a Bad Signal into a Winning Trade with the Right Strategy"}]},{"@type":"WebSite","@id":"https:\/\/www.smbtraining.com\/blog\/#website","url":"https:\/\/www.smbtraining.com\/blog\/","name":"SMB Training Blog","description":"Lessons from the trading desk","publisher":{"@id":"https:\/\/www.smbtraining.com\/blog\/#organization"},"potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.smbtraining.com\/blog\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/www.smbtraining.com\/blog\/#organization","name":"SMB Training","url":"https:\/\/www.smbtraining.com\/blog\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.smbtraining.com\/blog\/#\/schema\/logo\/image\/","url":"https:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2022\/07\/Logo-e1658419502954.png","contentUrl":"https:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2022\/07\/Logo-e1658419502954.png","width":230,"height":81,"caption":"SMB Training"},"image":{"@id":"https:\/\/www.smbtraining.com\/blog\/#\/schema\/logo\/image\/"},"sameAs":["https:\/\/www.facebook.com\/smbcap\/","https:\/\/x.com\/smbcapital","https:\/\/www.youtube.com\/user\/smbcapital"]},{"@type":"Person","@id":"https:\/\/www.smbtraining.com\/blog\/#\/schema\/person\/cf351af6828c3fc8f9d9067daef8b764","name":"Andrew Falde","sameAs":["http:\/\/lessthanrandom.com\/"],"url":"https:\/\/www.smbtraining.com\/blog\/author\/afalde"}]}},"_links":{"self":[{"href":"https:\/\/www.smbtraining.com\/blog\/wp-json\/wp\/v2\/posts\/40420","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.smbtraining.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.smbtraining.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.smbtraining.com\/blog\/wp-json\/wp\/v2\/users\/1039"}],"replies":[{"embeddable":true,"href":"https:\/\/www.smbtraining.com\/blog\/wp-json\/wp\/v2\/comments?post=40420"}],"version-history":[{"count":2,"href":"https:\/\/www.smbtraining.com\/blog\/wp-json\/wp\/v2\/posts\/40420\/revisions"}],"predecessor-version":[{"id":55640,"href":"https:\/\/www.smbtraining.com\/blog\/wp-json\/wp\/v2\/posts\/40420\/revisions\/55640"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.smbtraining.com\/blog\/wp-json\/wp\/v2\/media\/40421"}],"wp:attachment":[{"href":"https:\/\/www.smbtraining.com\/blog\/wp-json\/wp\/v2\/media?parent=40420"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.smbtraining.com\/blog\/wp-json\/wp\/v2\/categories?post=40420"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.smbtraining.com\/blog\/wp-json\/wp\/v2\/tags?post=40420"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}