There is only one for certain, constant event you can count on in trading:
Everything else is a variable. But the passage of time is constant.
This is why time decay is one of the most effective strategies for creating consistent gains in all of trading. The question is, what is the most effective strategy for taking advantage of time decay?
The answer is my CashFlow SPY strategy. It is the most effective strategy for consistently growing your account with low-risk, high-probability trades.
- Requires Very Little Capital
- Requires Very Little Time
One of the reasons this is so effective is because SPY has options that expire on Monday, Wednesday and Friday, creating the most effective combination of expirations for time decay strategies.
And that is exactly what the CashFlow SPY strategy is all about.
Imagine capturing the greatest amount of time decay possible 3 times each week, while completely limiting your risk.
How Does CashFlow SPY work?
CashFlow SPY uses what I call "Warped Time Decay" between two options to take advantage of time decay while also limiting risks.
For example, I am currently short one option that has a total time decay over the next 2-days of $200. Meanwhile, I am long an option (to limit risk) that has a total time decay of only $25 over the next 2-days. My short option decreases at a rate that is 8x faster than my long option.
This means, over the next 2-days, this limited risk trade could produce as much as $175.
Rinse and Repeat.
With each iteration (expiration), the potential gain on the trade increases, decreasing the overall risk exposure, and in some cases, completely doing away with the risk exposure. Check this out:
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