Weekly update: some real results this time (+16.09% this month!); continued automation challenges

I have set up a small account starting around October 1 where I have been doing:

• short oil trades (selling calls in /CL)
• some of Navigation Trading's trades, especially the "Iron Duck:"

No, not like that. Like this:

Maximum risk on the upside is $5 (i.e. $500) since the strikes are 3015 and 3010 ... but since this trade returns $6 (i.e $600) credit, your "max loss" on the upside is a gain of $100.

These have been working great, for earnings trades and otherwise ... my intuitive sense of these said they should win 95% or so of the time, and the Navigation guy said as much in his video update ... some user of his who's been doing this a lot has won 40 of 42, he said.

Anyway, my real results since October 1:

+16.09%

Interested? You can subscribe! (But: past performance is no guarantee of future results, as we've discussed before.)

Update on the automation project: nothing new ... waiting on T.D. Ameritrade to tell me about their FIX deal, but no response yet. Also waiting on Vela Trading to tell me the price of their Execution Gateway or whatever else they have that will work for us ... 

Getting impatient on this, but trading my small account until then ... More next week!

No risk to the upside ... a condor I hadn't seen before

Hi All ... sorry I'm late with this post as I was busy with the trade automation project I'm working on (more about this below) much of this past weekend.

But the Navigation Trading guy put through a trade this past week that got my attention. SPX was around 2885 last Thursday the 2nd, having been sharply down during the day. So the trade came through like this:

SELL -1 IRON CONDOR SPX 100 (Weeklys) 9 OCT 19 2895/2900/2830/2800 CALL/PUT @6.60 LMT 

I saw this go buy and just thought, "hm, kind of close on the upside ..." then it hit me a few minutes later:

• Max loss on the upside $5 ($2900 - $2895)
• BUT $6.60 credit received
• SO: max loss on the upside ... is a $1.60 (i.e. $160) profit!!

This is just what the doctor ordered:

... as SPX rocketed back up around 2950 the next day!

This trade only works this well with a little volatility in play (like now -- VIX closed 17.86 today) ... but a backtest since 2009 should show this Fabulously Profitable. You almost always either win small or win big ... probably only 5% of these trades should be losers ...

And once again: Navigation Trading available as a to-be-automated service and I can push these trades through for you 'by hand' in the interim. Details here.

Thanks!

Oil market calms down; ready to automate Navigation Trading ...

The oil market calmed down quickly after last week's spike:

And otherwise the market stayed pretty calm except for a down move late Friday ... Chinese officials cancelled a visit to U.S. farm country:

A trade update on the small account I'm trading: It's now up 15% or so since its trough about a month ago ... still much too far down overall, but moving in the right direction.

But the big news is on Navigation Trading and the new service I'm rolling out to automate these trades. I made a breakthrough earlier today on a key piece of the automation software and I should have this ready within a month or six weeks.

But don't wait! I can set you up with an account matched to my master account at Interactive Brokers and do the trades for you "by hand" until the automation piece is fully tested and ready.

Details here ... more next week!

A challenge for the "short oil" strategy; more on Navigation Trading

There was a Yemeni strike on the Saudi oil infrastructure this past week:

You might expect this to cause a spike in the price of oil, and in fact you'd be right:

But it looks like it peaked very briefly at $64 or so but is back down as I write this (Sunday 8:27 pm PDT) to $59.61. The Saudi oil industry isn't the key to the global supply it once was, and though this strike hit a key piece of infrastructure ... there's still plenty of oil washing around in the world supply.

Amory Lovins said that his vision of the long-term price of oil would be that it would be "low and irrelevant." I think he's still right on this point ...

More on Navigation Trading: "keeping the dream alive"

Once again, I'm working on automating access to this guy's trades ..  As you can see, he hasn't posted a losing month since he started keeping records in June 2017. 

How does he do it? For one thing, he doesn't count a trade as a loss until he's given up on "adjusting/rolling" it. For example, He closed out an Intel (INTC) trade last month (August 2019) that he started in late July or early August and "adjusted/rolled" several times before squeaking through to show a $26 profit.

Intel's challenge to neutral trading strategies this summer

This is OK as long as you understand that you won't be able to look at your account at the end of every month and see exactly the performance he's posting. If you have 2 or 3 of these trades going that he's in the middle of adjusting/rolling then you will be down possibly a few thousand dollars from what he posts ... but you should make up those by the end of the next month.

For further exploration of this idea, watch Tastytrade ... they call it "keeping the dream alive" ... There's also a book by an advocate of this approach:

Questions?