Most trade ideas I post here run 70-80% probability of profit. And last week I posted a USO call ratio spread at 82% POP. Yesterday it was breached, deep in the money, wrong side. You can't learn management from a trade that never goes against you. At this win rate I only get a few of these a year to practice on. So here's the part that makes everything else obvious. A call ratio is one long call and two short calls. Read it the other way and it's a debit spread plus one naked call. The debit spread looks after itself, at expiration, it delivers its full profit. Every repair works on that one naked contract. The four most of us already run: 1) Roll it up or out (for a credit) 2) Sell a put against it 3) Sell shorter dated puts repeatedly 4) Buy shares or futures for static delta New seven I've never published: 1) Capped ladder 2) Put broken wing instead of a naked put 3) ZEBRA or ZEEHBS in place of shares 4) Jade Lizard conversion 5) LEAPS cover 6) Renting the wing out weekly 7) Taking the assignment on purpose On my position a single 166 call costs about 1,250, the 166/174 vertical costs about 275. Same protection, starting 8 points away instead of 40, and I own nine of them for the price of two calls (that one came out of a research paper published this June). Full breakdown with strikes, payoff diagrams and the live position is on Patreon. When a ratio or a naked call gets breached, do you roll, cap it, or close?

A trade with an 82% probability of profit and unlimited risk. Both of those are true about the position I put on this morning. Most traders only ever read the first number. What saves you is a management plan written before the trade goes against you, and mine was written before I clicked. I also built a second version that caps the loss and cuts the buying power by 45%. Both versions, all the numbers, and the exact plan, in today's article

I sold a Big Lizard in DRAM this morning, and no matter how high it goes, I still get paid. DRAM went zero to $10B in 7 weeks, a pace only the biggest Bitcoin and gold launches have matched. I went through the holdings file: 3 companies are 70% of this memory chip fund, and it's paying 74.6% implied volatility. Almost nobody trades a Big Lizard. Full trade structure in today's article

I'm honestly shocked by how easily traders get seduced by backtests. Tools like OptionsOmega, OptionStack, eDeltaPro are curve-fitting machines. Tweak delta, move DTE, change width, entries, exits and filters until the curve finally behaves. There is no mathematical reason a cherry-picked in-sample curve should predict future returns. Test 45 independent variations of a strategy with zero real edge and the expected best Sharpe already lands near 1.0. Test 1,000 and it rises to 1.46. Bailey, Borwein, Lopez de Prado and Zhu showed mathematically how selection alone manufactures "alpha." I ran the formula myself. Zero edge. Options are even dirtier. Duarte, Jones and Wang found microstructure biases exceeding 50 basis points per day in some option-return estimates. Yet the backtest assumes you traded at the midpoint. That is why NOBODY from the OptionsOmega crowd has EVER replicated those backtests with transparent live results. Think about it. Post the live account next to the backtest. I'll go first. 51.43% average CAGR over the last 5 years using the Trading Plan. Every drawdown public. No backtests needed. P.S. Here's a second problem I skipped above. A paper accepted at The Review of Financial Studies found that many options backtests quietly throw out price quotes that look wrong, using information nobody had at the time of the trade. The tool curve-fits your entries. It also cheats on your fills. P.P.S. This is why, in our hedge fund, we don't use retail tools like these in the way they're advertised. There's a much smarter process for researching these strategies, closer to how it gets done at the institutional level. Happy to get into that in the comments if people want it. Has anyone here found a vendor, in this space or elsewhere, that puts live results next to the backtest instead of just the curve?

You've already seen my personal portfolio and the hedge fund book side by side, and I post many trade ideas from both my personal account and our audited fund. However, what happens after is what matters more: how to roll, how to adjust and transform trades, how to neutralize delta, how to hedge, how to recenter as the market moves, and how to repair trades that went wrong. That's what the real Model Portfolio is going to show. You already pushed me toward this idea in the previous survey. Now I'm funding a real account at a real broker and running it completely in the open. Summer engagement and market participation both run lower here, and a launch like this needs everyone paying attention. So I'm targeting mid-September. How I deliver all of this in real time is still something I'm working out. I'm exploring whether I can provide premium subscribers with read-only login and password, allowing you to log in anytime and see the actual portfolio directly: positions, P&L, buying power, Greeks, and adjustments. I still need to determine the safest and most practical solution. Two decisions left before I lock it in. Question: How big should the real Model Portfolio be? Vote for the size that teaches you the most. Bigger doesn't automatically mean more useful to watch.