Jump to content
Sign in to follow this  

DAX WEEKLY OPTIONS SET AND FORGET STRATEGY

Recommended Posts

BUY STRADDLE EVERY MONDAY 8 AM.Put limit order and set and forget until options expiry  on friday or  closing day.


PREMIUM PAID FOR STRADDLE IS 200 , THIS PREMIUM IS HIGH , WHEN VOLATILITY IS LOW , PREMIUM WILL BE LOWER AT 120 PIPS , THUS ELIMINATING MANY LOSSES FROM THESE CALCULATIONS

 

Using various betting sequences  , and taking profits  sequences , the following results were obtained on   rough back tests.The strategy is still in development. 

 

The following results were obtained , using £100k account

 

I am looking for hisrical  option prices for straddle  traded on monday am or tuesday am , on receipt I willl be able to post more

 

NB EDITED POST

I have actually found that by trading long  calls  only,  I  can get better profit .read more 

 

http://www.trade2win.com/boards/indices/224294-profitable-support-trading-indices-dow-dax-nasdaq-s-p.html#post2920018

 

 

accurate resultsIG.jpg

Share this post


Link to post

This week profit from this strategy was 240 pips .2014  option prices  example make this profitable in early periods of testing  , if option prices were around 120 

Share this post


Link to post

Using 120 pips  premiums in 2014  and  200  pips  thereafter  , results look like these

Share this post


Link to post

There it is  

 

9,000  ticks a year  PROFIT  , from 3 strategies  , £180,000  a year from 3 strategies , £20 per pip

Share this post


Link to post

Today the premiumis 180  for four days  , it is high  but this week also has  nfp

Share this post


Link to post

Interesting, where is your end target for the move at?

 

I currently have a position on 250 point credit from the 23 Mar turn ar B/E stop preotection but I think I'll hold that for the medium term (or at least until I see a bit more clarity on the move).  Got another 100 points from 9am this morning (2 positions) and mulling a split bet approach such that I would cash 1 and hold the other at B/E.  I think there is a bit more to go on this move before the US market begins to come alive and may provide a bit of a rally before another more significant drop.

 

What is your analysis telling you on the Dax?

Share this post


Link to post

Hi  Mercury

 

This is a set and forget strategy  , place limit orders on monday  on cash  , after buying straddle   and keep taking profits on the straddle  with cash limit orders , and run cash orders if filled for 300 pips  or expiry.

 

i  do no try and guess direction on this strategy

Share this post


Link to post

OK I get that, and can't follow it myself, but how do you set the 300 pip target?  Is that just a standard thing or does your analysis set out a target for hoow far the market will go, hence backing into a total pip amount?

Share this post


Link to post

When you run your profits on dax , it can move 300 pips in a day  , and it does it frequently  , that is when you make money.If you are patient , these profits will come  , and I got 3 more days  plus nfp

 

I like to run my profits  , when I catch the right side of dax

 

Most traders can not run their profits  or cut their profits  and underperform

 

 

Share this post


Link to post

I  was making 50 pips today  , I did not take it , my targets is  3 figures ..

 

If i  lose  , I can on ly lose 44 pips    , but if I make  , i will make  300

Share this post


Link to post

took 88 pips profit on cash  .closed it 

straddle cost 180 -88 92 pips premium left

 

i have two other positions long on dax   , straddle 9950 call  plus10050  call weekly for 32

 

should  really run this poition

Share this post


Link to post

Hi oilfxpro 

 

I will have to re-read this thread, but just jumping in on the last few posts - what do you mean when you say you make "pips" with the DAX or your option premiums? 

 

To me, pips are for FX and are 1/1000's.  Indexes, or other commodities use points, which are normally 1/100 or 1 cent say, or 1point on an index (multiplied by the dollar value per point of the index to get a cash equivalent).

 

300 pips on the DAX is not the same as 300 points then - which is why I ask.

And 300 pips for an option price (whatever that might be - 30cents?) is not the same as $3.00.

 

Yet seems like you are profitable whichever metric you are using.  Keep it up.  And thanks if you can clarify this small question. 

 

Share this post


Link to post

hi  Zero

 

I mean pips= full ticks i.e  9814 opening  to 9900  closing = 86 pips /ticks

Share this post


Link to post

Hi oilfxpro,

 

Thanks for that.  Makes sense now.  300pts (or more) would be a great! trade if you could make it.  Good stuff. 

Share this post


Link to post

Silly me  

impatience , my target was 300 , it has already given  230pips since entry

I came out with 88 pips   only

MOST traders underperform  

Share this post


Link to post

i had  9950 straddle  long , I  have now locked away 96 pips  from  92 pips   premium left .My net profit is only 4 pips  so far with 3 days remaining and nfp 

 

I still have 10050  weekly call  long

 

THE BENEFITS OF SET AND FORGET STRAEGIES (This is not a link to buy education)

 

http://www.learntotradethemarket.com/forex-trading-strategies/set-and-forget-forex-trading-keep-your-day-job

 

set and forget mechanical strategies can  eliminate  indicators , t/a , phsychology , execution and other issues  , these are  the oneswhere traders fail  

Share this post


Link to post

Hi  this is a really interesting idea.  May I just clarify.  I'm takling this to be a Long Straddle.

Would you Buy a Call & Buy a Put on the contract closest to the current level of the Index.  so right now the index is at 10304 so perhaps choose the 10300 Call and Put.  You pay premium on both and are in profit providing the index moves in either direction by enough to cover the cost of the two premiums paid - which by your trading experience/analysis it does. 

Thanks C

Share this post


Link to post

Hi  Condor

 

I usually use cash   to lock away option profits   , rather than close option trades 

 

xample my straddle is making 100 pips  on the long  , I go short cash  100 pips higher.

A straddle is  at the money

 

https://www.google.co.uk/webhp?sourceid=chrome-instant&ion=1&espv=2&ie=UTF-8#q=options+straddles+strangles+examples

 

It does not always cover the premium a,if volatility is low, these are losing weeks    , but when you get your winning weeks  , I run them  for  300 to to 500pips   (i failed this week on first trade , because I had other positions long)

Share this post


Link to post

Thanks  that makes sense (Long Straddle) .  So you watch progress during the week and if it moves as per your example..

 

'my straddle is making 100 pips  on the long  , I go short cash  100 pips higher.'......  i.e. The Buy of the Call (the index has gone up by 100 pips) ..... you [go short cash 100  pips higher] .... sorry don't quite get that...would you mind expanding that part ...  ( I get the idea you are locking in the profit ?)

 

C

 

 

Share this post


Link to post

I buy  9950  calls and puts  for 180, at begining of week

price goes to 9800  or within 10 pips , 9810  long cash dax , target 300 pips profit 

 

price goes to   10050  , short cash  to lock away profit on call  ,  target 300 pips profit  on cash short  ,let option expire

 

Share this post


Link to post

i am using  100 to  150 pips  , or  90  to 140 in real trading  (to get fills)

Share this post


Link to post

Thanks for your explain - I'm going to track this for the rest of the week (on paper) to see how it plays out.  Thank You

Share this post


Link to post

I'm looking to see if the strategy works in the Spread Betting Account - the  cost looks to be around 140 pips as I think you are indicating


Share this post


Link to post

Condor

 

You need to back test your strategy for at least 2 years , whatever variations you use

 

I am using   4 strategies around  the weekly options , straddles  , straddles+ cash , strangle for breakouts  ,strangles/cash  for counter trades , so FOLLOWING ME WOULD GET  CONFUSING.

 

I back tested allmy strategies on excelfor 2 years

Share this post


Link to post

Appreciate the health/wealth warning :) - thanks for the comment - glad you posted up this idea as I may be able to adapt / use for my own position on indices, DAX or otherwise.

Share this post


Link to post
 
 

yesterday

i had  9950 straddle  long , I  have now locked away 96 pips  from  92 pips   premium left .My net profit is only 4 pips  so far with 3 days remaining and nfp 

 

I still have 10050  weekly call  long

 

I decided to take 64 puips       profit on cash short  , this was not written in system (market  is biased  long ,  )    , this leaves me with   32 ticks risk on the table , with the 9950 straddle in place.There  are many phsychological reasons  why traders  can not follow systems to the rule

 

 

 



Share this post


Link to post

Hi . I'm running this on demo account on Dax from yesterday.  Are you trading on your CFD account?

Keep the updates coming. Thanks

Share this post


Link to post

i   took an overnight long on dax   at 9906     against straddle    =  44 pips locked away  - 32 = 12 pips profit locked away

 

less overnight carry

Share this post


Link to post

Join the conversation

You are posting as a guest. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
You are posting as a guest. If you have an account, please sign in.
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Sign in to follow this  

  • Member Statistics

    • Total Topics
      12,432
    • Total Posts
      63,189
    • Total Members
      83,905
    Newest Member
    Dawei
    Joined 20/09/20 21:14
  • Posts

×
×