Weekly Newsletter   Challenge account   Weekly Newsletter   


2022 SPX put credit spreads trading review – week 40

Last week SPX trading started well… and then it all puked again. This is definitely a very difficult time to trade. You can get whipsawed quickly or you adopt a strategy where you maintain the trades and adjust them to stay afloat and eventually a winner in the end. Some traders open a trade, usually a zero DTE one, and then place a stop loss. Unless you are a full-time trader and can watch the trade you will most likely lose money being stopped almost every time. How do you react to a trade when the market rallies in the morning and pukes in the afternoon? I adopted a strategy where I roll the trades no matter whether others like it or hate it. It is capital intensive, sometimes very frustrating, but doable.
 

I traded a little last week. I opened a trade that almost went bust. Fortunately, it expired a day before that market pooped again. Then I opened a debit trade (a butterfly, which I adjusted – I should have not touched it – and later adjusted it again).

These trades delivered a -$85.00 loss. It is not a loss, but debit I paid for the debit trades, so it still may change next week if these trades play out. Our account is down by -0.23% while SPX gained +1.51%.
 

Our SPX account is up +920.53% since the beginning of this program, and we have $36,738.95 in unrealized gains.

 

Initial SPX trade set ups

 

I dedicated a $3,600 initial amount that will be used to trade SPX PCS strategy per week. Today, the account is up at $36,738.95. However, due to the recent bear market, many trades are still tight to open trades which need to expire to release the funds.
 

Our SPX strategy is designed as directional options trading. We are selling credit put spreads to collect premiums, and hopefully, these spreads expire worthlessly, or we repurchase them for a small debit.

We use a set of indicators (primarily based on moving averages and volume profiles) and market sentiment that generates bullish signals. The trading is based on a “trend-following strategy.” We open the trade if we have a bullish signal and a bullish trend. If we do not have a signal, we stay away.

We set the set of rules and alerts and backtested them. The backtesting software proved that the strategy was viable and returned good gains. We also tried to automate the decision-making as much as possible to have the trading as mechanical as possible. This helps eliminate our emotions. The decision-making was reduced to: “bullish signal present” – open a trade, “not present” – stay away. It worked well.

Here you can see all our trades:

 
SPX PCS account value
Click on the picture above to see the entire list.
 

Last week trading

 

Overall, the strategy resulted in a +920.53% gain last week.
 

Initial account value (since inception: 12/07/2021): $3,600.00
Last week beginning value: $36,823.95
Last week ending value: $36,738.95 (-0.23%; total: +920.53%)
The highest capital requirements to trade this strategy: $19,995
Current capital at risk: -$12,215
Unrealized Gain: $41,215 (-337.41%)
Realized Gain: -$7,920 (64.84%)
Total Gain: $33,295 (-272.57%)
Win Ratio: 56%
Average Winner: $318
Average Loser: $512

 

SPX PCS account value
SPX PCS account value
 

SPX PCS account vs SPX
SPX PCS account vs SPX index net liq
 

SPX PCS account vs SPX
SPX PCS account vs SPX index
 

If you want to receive trade alerts whenever we open a new SPX put credit spread or a hedge trade, you can subscribe to our service:

 

SUBSCRIBE HERE

 

Note, if you wish to subscribe to multiple levels, you can do so by subscribing to one level only and then sending us an email that you want to be added to other levels too.

Also, if you like this report, hit the like button so I know there is enough audience wanting to see this type of report. If you have any questions or want to see anything else about my SPX trading, do not hesitate to contact me or write a comment in the comments section. Thank you!

 
 





Leave a Reply

Your email address will not be published.