How to Turn Losing O DTE Options Trades Into Winners (Simple Fix)

[@wilfriedl5137]

Due to time dacay at 02.00 p.m.: If you close the complete trade with the values given at 7:10 , you make 674 USD. This is about half of the shown result, but no risk.

[@zhigangliu384]

Two more scenarios are: market keep going and you lose more than the original condor after roll. Or market reverse you would have made the full amount of the original condor. So carefully initiate condor before hand is much more important than thinking you can always roll to make money.

[@hapalaj]

Opening the new call spread adds just 3% to the credit after closing the losing call spread. It does seem too negligible to take the risk.

[@Kzvuyp]

Seth a few months ago I was looking to learn about covered calls. I was hesitant but in your video you said to make trades were you feel (data) says you can be bullish about the particular stock. Learning this has made a difference in my monthly budget. I had non dividend paying stock that now helps my income. Just wanted to leave you this message so you know you are helping people. Thanks for making covered calls education available to regular people.

[@Ezra7Goldman]

Iv only been trading for about 2y now, and its finally all making sense. Cant wait to save up and go train with these guys, love what they do. thanks for the vids SMB!

[@coreycorey9611]

Great video. It would be nice to see more option adjustment videos presented on a regular basis.

[@CrazyTrio-i2l]

Great! Thank you! It will be useful if you understand rolling: 1. If the price goes up faster and exceeds both strikes. 2. Analyze rolling the iron butterfly in the money and out of the money🙏💚

[@doug7932]

Is there a reason you didn't roll up the PUT wing at the same time? That would have improved the profit in this example.

[@pixstamp]

I would keep the 4215 long calls instead of rolling them to 4225 because the difference of $36 is rather low and it protects 10 additional points in case the market keeps rallying.

[@leon21th64]

Thanks Seth. I guess that the example fits a certain scenario which is market rally and close to the upside more than expected. However, the real value of this video, like you said the "take away" is the flexibility of fixing the original trade based on price action. On the other hand, I could have turned around the credit bearish call spread into debit bullish call spread in case the market blow out to the up side. If it happened to be a up side tread day, I could have made rather large profit. Another notable thing is that each of your spread has maximum loss of around 2000 (spread - credit) and you have set the short strike price to only ~30 points away from current price. Which is only around half of ATR. So, the chance of one of the spread being breached (current price cross short price) is pretty high. Off course, further away short strike would have increased the max loss. Just sharing a few of my experiences trading 0DTE credit spreads. Hope it make sense.

[@cbpuzzle]

Yes, but then you've completely changed to a debit strategy on the side in danger, and that has it's risks as well. You're paying cash out to buy with very little time left in 0DTE with theta decay going exponential.

[@cbpuzzle]

Summary: At the open, sell strikes 0.6% OTM or 22 delta on both sides at 0.6% spread width and hope for the best. If one side goes wrong by 2x the delta (44 delta, but was 50 in the example) roll it away, but not out to 3 delta (or by an additional 0.2% in strike distance). Looks like the example trade was filled about 9:35am. But given the larger declining VWAP and rising shorter VWAP on that day, it would have been crazy to put the Call side on in the morning blindly because of the prior day rally and body gap over declining VWAP which would have been a sign it's reaching up for +1 sig.

[@ytdp73]

Thanks -- very helpful! In this example would the trigger to execute the roll be the moment SPX trades at 4190 or would the guys on your desk take action before price reached the short call price level?

[@clevo4040]

Appreciate the breakdown of the negative cost impact of the roll at the end.

[@melissam3837]

This happened to me yesterday except I had a max loss on SPX IC. It’s important to note that you must have enough $ in your account for the original trade plus enough money to cover the cost of defending it in case it goes wrong. I couldn’t defend it because my account was just shy of the amount I needed to roll. It was terrible and I may just have ruined all the progress I made to the point where I’m out.

[@wolfgangrosner7761]

yes, similar here except I was on a simulated account and had only a SPX CCS setup which then to my surprise was heavily attacked. What I did though (simulated): I rolled it out to monday and still up for 10 points for a small credit. I figured the market is overbought and will come down early next week. Ok, no guarantee, and this way, of course, it is no longer a 0DTE. I have done this several times and sometimes it avoids a loss and even yields more than initially intended. Several times I setup a sell order before opening with a limit price that satisfied my intended yield and it was filled (as options prices jump a lot on the day of expiry). I will do that on monday morning before opening again. The question for me is: will I get those fills even when on a real$$$ account....

[@melissam3837]

Good question because they fill easier on SIM. I’ve tried twice to roll when I was caught. The first time was a fat finger trade and messed up the strike price my accident. On Friday I was totally stuck because no matter when I rolled it or even if I lowered the strike price to try for a credit, I just didn’t have enough in my account to cover the loss and the roll. My fault, but didn’t think to leave enough for an emergency roll. Yeah the ICs and CCSs had people going crazy on Friday

[@wolfgangrosner7761]

@@melissam3837 reminds me to be more cautious with lot size when going live. I imagine, it's hard to get a fill for escaping a loss the closer you come to expiry. Who would still want to take the counter position then? I'll test more on SIM but I am not sure if this idea of 0DTE is feasible without heart attack. If you do as proposed by Seth, 25 pts out, you are running a huge risk even more as he proposes 25pts wings. I am going out at least the expected move and just 15-20 points wide spreads... Take care!

[@horacioumfurer1194]

@@melissam3837 Trade small. If the max loss is $10k make sure you have $10k in your account. Look at the profit as a percentage of the required capital to put on the trade. For example, if the profit is $300 and the capital required is $10k, then you make 3% IN ONE DAY!! now multiply that by all the trades you put on where you make 2% to 3%. Of course, you won't win every single time. 20 to 30% return a year, every year is ideal. If you aim to make more than that, you will eventually blow out your account.

[@koenigsgambiter]

Very well explained. You roll up, but not up and out. Days like last Friday will be very frustrating. There was a big up move. Rolling and rolling, or what do you want to do?

[@You-Tube...005]

So basically, I sell the condor and then buy another one further out. Got it! Thank you

[@Jennyuk1]

Stocks extended their year-to-date rally following the CPI report, with the S&P 500 last up 0.8% in afternoon trading. but I don't know if stocks will quickly rebound, continue to pull back or move sideways for a few weeks, or if conditions will rapidly deteriorate.I am under pressure to grow my reserve of $250k.

[@Lettyogle]

Picking stocks is a risky thing to do, particularly for non-professionals. I learnt that in 2020, when I lost almost everything. But I switched to using a financial advisor and I've been returning at least $38k every month so I’ve been sticking to investing via an Advisor.

[@gracegomez109]

I’ve been looking to switch to an advisor for a while now. Any help pointing me to who your advisor is?

[@Lettyogle]

LINDA PEREZ LEWIS That’s my licesed Financial advisor you can easily look her up, Thank me later!

[@gracegomez109]

Thanks, I merely looked her up on Google and was highly impressed by her credentials; I got in touch with her because I need all the help I can get. I just set up phone call.

[@dllmohh6026]

Do you have strategies to modify trades that are loser to winner for 0DTE put & call credit spread i.e, direction bias trade?

[@artemispoppy]

awesome, thanks for this!

[@johnsonra6285]

I like this strategy and it seems great if you are able to sit and watch the market all day. Maybe once I get the permission to exercise level 3 trades, I will use one of my days off and try this. I do wish you would have shown the math if you did not roll the condor so people could see the difference.

[@jessepollock2630]

Just pause the video and do the math. It would be good practice don't you think?

[@medinab3750]

It's only like a 70 dollar difference

[@Jrd387]

You can implement stop or stop limit order at a set price to close out the position so you don’t have to sit and watch if you don’t want to or can’t.

[@eduartzina]

Hello and thank you for this lesson, very informative. I have a question regarding a situation where a market makes a sudden move up/down and you have to make a decision, what would be your suggestion for this scenario? Thx in advance.

[@josephmitchell6340]

I got damn sold my LRCX calls for 40$!!! 2 of em cause I needed sleep and I was down 1k for the week so I sold. I woke to see 1600 a piece!!! Yes I've done this and many do many times but the return on income and percent gains here were insane for a day and I am sick. I not only did that but i got puts on LRCX which are smoked despite being exp next Friday I think. Not my day. Tired of hedging cause I lost all my account and can't go margin. It sucks may as well take the next 5 to 10yrs off

[@wcwong3868]

Great video! Very very good!Thanks for it ! ! !

[@InspireNewGeneration]

Why if market keep rallying? Do you keep rolling? Also, exactly at which point do you buy back & initiate condor roll?

[@deathbybabomb]

Good question really. I often rolled condors until someone pointed this out to me. When you roll, you are closing that initial position and realizing the loss, while basically doubling down against the market. Moreover, 0 DTE have huge gamma exposure. So a little price change is a big win/loss I can't wrap my head around probabilities of profit when I'm literally seeing the market go against my trade.

[@roxi-l8f]

рабочая связка,спасибо за разбор)

[@johnfinch155]

If I sold a QQQ 0dte option and it expires out of the money, if after hours due to earnings announcements the QQQ moved into the money can the option get exercised after hours?

[@bertimus7031]

Very Nice, i hate losing also.

[@srinisankaran2455]

There is HUGE dependency on WHEN you actually roll the call condor - in this example you sold the 4190 for $4.05 and bought at $5 - this can only happen if you have swiftly realized that the trade is going against you -

[@stevefellows7063]

Agreed.. I would rather raise the untested and decayed side up, convert this to a butterfly or bwb to take more premium and bank profit early on

[@srinisankaran2455]

@@stevefellows7063 in other words the example in this video is not practical to execute.

[@stevefellows7063]

@@srinisankaran2455 I wouldnt say it is not practical to execute, it all comes down to timing of the adjustment(s) and how you want to adjust the 0DTE. You could convert it into a butterfly, or do as per the SMB scenario here. The other factor to keep in mind is the move in IV as that affects premium as well. Often when the market moves up, vol drops, and as time progresses on a 0DTE decay dramatically speeds up. So for me, if it moves up the put legs have benefited from price and vol dropping which is why that is where I goto first and can take more credit without changing my risk profile on the trade. Also, you may want to set a profit target and not run it all the way to the end of trading session - all depends on your trade plan (risk management options and trade exit plan).

[@seanbrownsociety]

Good point. And if you're always rolling very swiftly at minor losses everytime, you'll lose many gains in the long run.

[@stevefellows7063]

@@seanbrownsociety Kinda depends .... if you've entered a trade and you see alot of confirmation of direction then managing early and cutting risk is a good thing (many ways to do that). Many ways to do adjustments on options

[@truthwillalwaysprevail]

Question is at what point you decide to roll the tested side. in your case SCV. Do you wait till it gets to say some point close to short call leg or some % of you intial credit lost? Other question i assume this when you are certain by some probability rule that your short leg is in danger to be breached then why sell the long call leg? Why not roll only the losing short leg? Thanks for showing the good winning probability 0DTE

[@autumninvest3312]

imo, if you seeing/foresee a clear trend, then it also makes sense to remove the losing short leg only. Roll the condor is like to exchange some potential profit to extend the probability to win while you still holding the neutral perspective to the market.

[@martinjames27]

What brokerage is good for iron condors? Platform’s like Robinhood will close these options around 3:30 pm actively giving less than anticipated credits from such trades

[@wolfgangrosner7761]

TD Ameritrade, I use it

[@preciousdafe3988]

Better safe when using Robinhood, don't close the short condors at 100% max profit. Just set a target profit and close when it gets there. or trade SPX which is cash-settled and you could hold till after 3:30 pm.

[@run2daylite]

I tried to execute this trade on 3 separate occasions and each time the net debt was higher than the initial credit. Tried it when the short went in the money and before it went in the money. Volatility hasn't changed that much from when this video was posted so no clue how they pulled it off, if even they did. The only way I can see to defend this trade is to roll the untested short, but that increases risk. Tell me where I'm wrong

[@xcccp661]

Can anyone tell me what’s better , we not taking about cost of this , just trade itself: spx: 1 lot 15, 20 spread or 3, 4 lots with 5 spread, for credit spreads

[@Nickc86]

If you were to try this strategy on Friday you would have went broke because the rally was so big

[@Jupiter_9911]

This makes sense of course, but i dont understand why so many other youtubers suggest rolling up the other side, as if it makes a difference when the price in the money

[@jcnash47]

I had two days in a row of my 0 DTE IC being breached on one side this week. Thursday it was the put side, Friday the call side. I just kept rolling up the opposite side and collecting more credit while pocketing those profits as a hedge. If I see that the market is going to the moon as it did this past Friday, I don't even put on another call side for fear of those being breached all over again. The risk/reward often doesn't pay to keep moving the call side in a melt-up due to theta decay. You'd end up losing more if you kept putting on call spreads that would continually be breached.

[@Jupiter_9911]

@@jcnash47 I see. So you are basically closing the breaching side, while moving the non breached side closer to the price, leaving you with a Put Credit Spread on the not affected side only?

[@jcnash47]

@@Jupiter_9911 Yes. This is the method TastyTrade preaches. As long as you keep receiving credit each time you roll the unaffected side. If you roll for debits, you're just increasing your cost instead of decreasing your cost basis in the IC. On Friday, I rolled my put side a few times and went from almost a $1K loss to just a $300 loss. I would've kept going if there was more time left but theta was working too quickly after that.

[@TableTennisLover1234]

While I find this video to be somewhat informative about Iron Condors, at the end it’s click bait. Firstly, the presenter doesn’t tell us what was the premise behind the specific strike selections and their distance from the market when they were initiated. Does implied or realized vol play an important role in their selection? Secondly, he doesn’t go into further detail of when to roll up the IC. Do we roll after a set % loss? Unfortunately, that important piece of info was left out. Thirdly, size of account is important. Traders with an account size of less than 25k who find themselves constantly adjusting SPX trades will be flagged as pattern day traders, limiting them to only 3 day trades in 5 business days. Therefore, IC trades are better implemented with ES futures options than SPX options for smaller accounts despite the fact that ES futures options exposes the trader to assignment risk. Solution: Manage the trade by closing it before the end of that day. Lastly, the video title was misleading. It said how to turn a losing 0DTE option into a winner, but doesn’t discuss straight call and put purchases that went array leaving me feeling quite disappointed.

[@scoiatael6726]

Problem with this strategy is if the market keeps rallying, you will end up losing more money.

[@Eqnotalent]

Why not do a next day roll? But same day roll. Rarely you can roll out same day and still collect credit.

[@timb4695]

Always works great until it doesn't. If the market goes up hard eventually theta will eat you up. If the market goes up to 4225 you will lose $6-$8K, OR you can roll to the next day, but you must have enough margin to roll. If the market is trending as it did last week you would eventually get smoked big time. Would be nice to discuss those situations, but as we know there really isn't anything to discuss because you will eventually get absolutely smoked. Can we discuss what to do in those scenarios? Or do we just get smoked?

[@mariuszek55]

iron condor is great when you have a lots of capital. what is not ok is insane price for your (simple fix)

[@thealternativecontrarian9936]

How to roll the calls in an iron condor. Lesson learned.

[@baddyll28]

Am I missing something, or as per the example trade, would you need a 6 out 7 win rate to break even on this strategy?

[@patrickgo5004]

thanks

[@dannytetreault]

Why are the wings of this Iron Condor so wide? Crazy!

[@jg5479]

Well when markets have been rallying far more then 35 pts I. The day due to increase in volatility and sometimes rallies 70pts, why not if one side goes against you on the iron condor buy back the short call or puts and invert above the long side therefore making a debit spread incase the market keeps rallying. Will allow you to keep more of the credit received from rolling up/down the short legs and still might make a profit in case it pulls back eod action above the long legs but below/above the short legs.

[@stevefellows7063]

I would have rolled up the put spread first.

[@lettermanstud]

I know this is 10 months ago, but spx swings 100 points in some days, this is risky. Also if you are under 25k you will hit PDT instantly.

[@angelodorsett1]

Seems like calculus to me.

[@foxfox-m9q]

Do you still remember the stock Kodak? What is your opinion on the trend of Kodak stock in the past three years?

[@orderflowdojo]

Slap the bid 📉