I tried many strategies trading SPX and none worked to my satisfaction. Then I decided to trade “SPX crumbs”. And you may ask, what is SPX crumbs? It is a trade with a very small premium trading standard verticals like spreads, Iron Condors or broken wing butterflies.
In the past trades I tried to maximize premiums. I was timing the market. When it was bullish, I opened a put spread and usually with delta 30 or sometimes even delta 40 or 45. This worked well in trending markets. And of course, it worked well until it didn’t. And since 2022 we were in a bear market and volatile market. And this trading stopped working. So, I was looking at something that would work better.
I came up with trades traders may consider not worth it. Why? Because according to a common knowledge, I will be “risking too much to make very little.” In the past, I have read on the internets and in forums that if I traded a $10 (or $1000) wide spread and make only $20 premium, that it was bad. The risk reward was too bad. But I found it not bad if you take into account probabilities. And I realized that picking up crumbs from the table is worth it if I can do it again and again and sleep well. So, yes, that $20 (after fees) is a crumb not worth it to you, but very valuable to me.
Here is a list of trades I took so far last month and in October. Despite markets moving up and down like crazy, all trades ended up winners:
If I can repeat this process again and again every month, I will make quite good income (as of today, the projected income would be almost $30,000 a year, given the winning streak will continue). And those little crumbs will add up over time.
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