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Thank you Teddi for responding. I have a specific question on RICs which is how you manage the short leg. What I mean is say the long call/put goes in your direction and the spread is eaten away by increases in the long option. But the flip side is the short side of the option goes against you (to buy it back increases). So do you have criteria that tells you when to buy back the short option and let the long option run. This is what has kept me from using the RIC approach and where my losses occur. I have been successful selling Iron Condors going into earnings now I would like to flip this around and become successful with RICs. Hopefully, there is a simple answer to my question. Thanks.
I second the RIC results. The trades are placed and seldom do we know the results or how they are managed as one goes through the life-cycle. Would love to use them, but they have always failed me even when I duplicate the trade. Good strategy, big returns? I am not seeing it. And yes I have tried paper trading.
This reply has been marked as private.This reply has been marked as private.Hey Art,
I don’t know what Teddi does but as soon as the buy trade is made I set up the sell trade and (on TOS). I can hide that page (so I can see) until necessary. As soon as I want to sell I click, and the sell trade is visible. Then, (after getting screwed a few times by using a market order), I place the BTC somewhere between bid and ask. Works much of the time. Sometimes the b/a change and I have to adjust.
David
Well, I’m gonna take Teddi’s advice and paper trade for the next few months.
To answer your question about entry point (if I understand you correctly) I copy Teddi and go in when the 5 and 7 have both crossed the 15. I think that’s what you’re asking.
What I found really helpful is Teddi’s tips; like look out for long tails as a warning that the trend could be changing (struggle between buyers and sellers). Another is don’t pull the trigger yet if you see a red bar as the next bar after an up signal or a green after a red. Wait and see.
I wish I could do a brain dump on Teddi or maybe the Vulcan Mind Meld and find out all her trick LOL.
Alvin, as far as what expiration date I use, I’m cheap, I use the closest in, even if it’s the same day. I know there are disadvantages to that. But I usually plan for the trade to last at most 10-15 minutes.
Hi Alvin,
I’m trading live not paper. The reason is the stress points (ie my emotions) aren’t the same. But I’m only trading 1 option per. I’m doing a lot of breaking even and some trades at win/lose $20-$50. My problem is I’m scared money and spook easy. I’ll close at the first sign of trouble. Teddi might hang in there for a few rounds of averaging lower and it usually pays off. I don’t have her stick-to-itiveness.
How are you doing? Do you feel you can go live yet?
David
I hope you closed out the trade today. You could have BTC the short leg for about $0.10 this morning. You can still close it for about $0.20 which is still a gain.
hi Investor237,
Teddi seems super busy these days, and I am very new here too, however, if you sold the 26 strike on March 30 for 24 $ and today the shares might not even be assigned to you with just 1/2 $ you made a huge profit from the sale of the put, congratulations – as to your question naked puts or calls have a much higher risk and require a level 4 option agreement and margin requirement as you already said – in this case clearly your trade would have been better without buying the 2nd leg, however in many cases it can be a lifesaver – just imagine for a second WFC goes into receivership and you are suddenly faced with a total loss,.
hope this helps