Trading as a Business – Kirt Christensen – Options Science
They teach options trading strategies.
The main strategies taught are: credits spreads, iron condors and iron butterflies.
The first 5 videos deal with a basic credit spread system, but one which is reliant on their ETF Tipping Point subscription software in order to get entry/exit signals.
The last 3 videos consist of a rehash of the system taught at
– although they don’t go into anywhere near as much detail as the original course.
Simple Rules for Using Options to Trade
the “ETF TREND TRADING SYSTEM”!
• ETF entry and exit points are determined by the “ETF
Trend Trading System”, but ONLY for use on 5BP
Break out Trades!
• When the system signals to buy an ETF, instead buy a
call option. How many to buy depends on your risk
tolerance. Remember, each call option is equivalent to
100 shares of the ETF!
CONSERVATIVE: Choose how many calls to buy,
based on how many SHARES of the ETF the system
indicates, and round up. (If the system tells you to buy
121 shares of the SPY, instead, buy 2 calls options.)
1) 30-40 days before expiration, start looking at potential strike
prices on the DIA, QQQQ, IWM & SPY. This time frame
allows us to collect maximum credits, for the shortest period
of time. NOTE: If you put on trades at more than 30 days
before expiration, you’ll have overlapping monthly trades, so
you’ll need to adjust how much is allocated to each trade.
Allocate 50% of your total Iron Condor trading capital as a
reserve for adjustments, and divide the amount traded over
the 4 major ETFs. If you’d like to diversify more and trade
additional ETFs, consider trading the following: KBE, XOI,
HUI (or GLD), SMH, IYR, XLB.
2) Find the PUT option that has a delta closest to -.10. Never
choose a put that has a delta of -.11 or higher. Leave more
room to the downside, usually 1-2 strikes lower than you
would on the call side, markets crash down, not up!
3) Find the call option that has a delta closest to .10. Never
choose an option that has a delta of .11 or higher.
4) Make sure that these strike prices are well outside & beyond
1 standard deviation (68% probability setting in the TOS
software) AND strong support and resistance levels.* Move
strikes further out if not. Set your “wings” (the long side of
the trade, on both the put and call sides) to 1 strike above
and below the short side of the trade.
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