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Moving Average Credit Spread Options Trading Strategy SPX RUT

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Moving Average Credit Spread Options Trading Strategy SPX RUT Backtest more moving average options trading strategies with CML Trade Machine. Here's the link: http://bit.ly/2yfc2fn For more options trading research and trade notifications, join the Vertical Spread Options Trading member site on Patreon. Here's the link: http://bit.ly/2DM7bs6 Video Summary: This video outlines use CML Trade Machine to backtest selling put credit spreads on SPX and RUT when price is above the 50 day simple moving average. The backtest goes back 10 years as well as the 2007-2009 financial crisis. Thanks for watching. Eric PS: Here are some additional resources if you'd like to connect with me to improve your options trading. Bollinger Band and RSI Strategy PDF For Weekly Option Credit Spreads: http://bit.ly/2Owynkh Options Trading Research Center on Patreon http://bit.ly/2N8LFiI Options Trading Facebook Group: http://bit.ly/2tkdPgh Options Trading Backtester and Powerful Earnings Research Tool: http://bit.ly/2yfc2fn
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Text Comments (20)
Ed B. (10 days ago)
I'm interested in signing up for a subscription but after signing up with a Patreon account, bit confused on how to do so, Any direction would be appreciated. Thanks.
Ed B. (8 days ago)
That was me. Thanks, Eric. +Vertical Spread Options Trading
Hi Ed, I think I saw your name getting signed up but here’s a link just in case. Talk to you soon. http://bit.ly/2QW2ApW
Giggidygiggidy12 (19 days ago)
Would you share your opinion trading the strategy of 1 or 2% spy trade selling one or two days before expiration on a weekly basis? I've heard opinions say its pennies in front of a steam roller, etc... thank you in advance
A z (22 days ago)
it is great .
majoslav (22 days ago)
I'm wondering what results would you get by closing the trade at 200 % of credit received in case the market is going against you. Could you maybe backtest this scenario?
majoslav (22 days ago)
+Vertical Spread Options Trading ok, thanks
In almost all backtests I’ve done, stop losses on credit spreads take away from profits over time. There may be a couple trades it helps but by closing the trade early, you take away the ones that come back. Overtime the probabilities will play out and stop losses don’t really help. I’m strictly talking credit spreads here to be clear.
majoslav (22 days ago)
+Vertical Spread Options Trading Yes, credit spreads are defined risk trades, but it's always better to lose $300 instead of $500 on one trade by closing the trade earlier.
I can backtest various stop losses but I’ve never seen a stop on credit spreads help over time. Credit spreads are defined risk so I go knowing what my max loss is and that it is possible. That makes the trade easier in that you don’t need to think about it afterwards. Just my take on it.
Daniel Oathout (26 days ago)
I am wondering if the profit would be higher if the spread was larger i.e 10 pts vs 5 pts. With such a high success rate I would think that it would be higher. The tasty trade guys like wider wings on their condors because their P/L is higher with the wider wings.
Yes, the profit per spread would be higher the wider it is but so is the risk. I think 10 points is good width for this trade. The tastytrade iron condor is more of a vol crush time sell at a different part of the theta curve and they don’t really use technical analysis. This trade is a little different I that it’s based on technicals with an upside bias. So a little different. Regardless, widening the spread would work too I think as long as you’re sticking with Delta 30 as the sold strike about 30 dte. Thanks Daniel.
SUPREME PENNY STOCKS (27 days ago)
Very well done and explained! Will share with my subscribers! I moved to sell time value from trading penny stocks and it changed my life! Vastly more consistency and regular income!
Thanks for the kind words and for sharing this with your subscribers. I really appreciate it.
Hey, thanks for posting this. Strategy is nice and simple. As for the bear market, seems it only performs well coming out of the bear market, at the end (cehck out the dark blue line, it's below zero until the end, but all the strategies actually gain at the end, it just happens to have lost less and is gaining more, like the 45 delta strategy)). According to this graph, it actually loses money throughout the bear market. Also, with 50MA strategy, the thing is that by the time the MA gets below 50, you've already lost a lot of money playing a strategy like this, because there's no way to know if it's going to go below the 50 when it goes down, until it gets there, so you could trade on the way down a few times and lose in the end. But it's great when above 50 because like you said it's bull or sideways, so you're pretty much bound to win. Also wanted to point out that even the at the money strategy (48 delta) during bear market has a high win rate (73.5%) so it's not an issue of probabilities that's keeping it from performing well. It's the fact that you lose more than you win (3.8k wins to 5.5k losses) as compared with the 84.8% win rate on the 31 delta strategy (5k gains to 3.8k losses). Longterm you could definitely make money on this one, as long as market stays above 50 way more than going below it.
Thanks for the insight and I agree with what you’re saying. The issue is that we’re both looking at at this in hindsight and see Pilsner have known the bear market started or ended. So I wanted to show that if you just stick the plan, it would’ve done well so you you wouldn’t have to think/predict about what the market might do (impossible to do) Now I think if you combine this with a bear call spread strategy for bearish market conditions, you could have a solid plan for all markets that consistent and simple to follow. Working on the call spread side and will post a separate video at a later date. It didn’t do that well when reversing the conditions. Thanks again for commenting and taking the time to really look at it. I appreciate the conversation.
ChrisF (1 month ago)
Love this strategy. So no trade management, correct? Meaning, open the trade, close if you get to 50% max profit or let it run to expiration. Bonus: SPX/RUT have tax advantages as 60% (I believe) is treated as long-term gains. Awesome video.
That’s correct. This backtest risked max loss on each trade but the probabilities won over time so just need to position correctly. And yes, there are tax advantages for SPX. Thanks.
William Pruitt (1 month ago)
when you say close and immediately put on new trade...explain? same strike another 30 days out? or the new trade would be whatever the new 30 delta is , 30 DTE..?
For this study, the software opened a new trade once the current trade closed. The new trade would be a new delta 30 spread with about 30 dte. So a totally new trade.

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