Paper Trades Report for Sep 04. 2018

Daily Performance Report

Based on several feedbacks, we have changed the format of posting of trade ideas.

 

How was it done in August 2018?

Once system generated a buys signal, we used to post a particular strike option and the mid price of that option. Strike selection was as close to At the Money as possible. Since selection of a particular option. posting of its price was manual there used to be a bit of delay between signal generation and posting. Also several followers on Stocktwits/Twitter were also requesting a bit of advance notice of potential trade opportunity.

 

How will it be done going forward?

An advance notice of potential signal will be posted when a certain threshold is hit.

  1. No details of calls (Strike, Price etc) will be posted. 
  2. Only SYMBOL and BUY/SELL signal will be provided.
  3. Once the market is closed hypothetical trades for following instruments will be published
  • ATM Call (50% Delta)
  • OTM Call (around 25 % Delta)
  • DITM Call (Close to 100% Delta)
Going Forward
Daily Report Sep 04, 2018

Our trading rules for short term trades using ATM options are as follows:

  1. Be very conservative to open an options position.
  2. Once a position is opened, be very aggressive to close open position to avoid value erosion due to theta decay or Implied Volatility (IV) collapse.
  3. Position close signal gets generated based on following criteria:
    • Day’s high price is hit OR 
    • When accumulated profit is > 20% OR
    • End of the day OR
    • If held overnight Followng day high Irrespective of gain/loss
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