Hedged options selling systems sys14 and sys15 by botpro

[gwjqqbrp11]

Hello, I'm new here.
I have recently developed the following options selling system.
It has not been tested in the real markets yet.
Any comments, feedback and ideas to further improve it is kindly welcome. Thx.

[Hawsestake]

You're not really hedging, since you cover 100% while the ATM call has a delta of 50.
Try 50% hedge, so a move in the stock is actually offset by the option.

Second, your'e also playing a volatility trade. Vol up, you lose...

Third, in a volatile market you'll be wiped out. You underestimate the number of trades in the stock you need to do and the constant losses you will generate with that. Especially when you cut at 10cts up and down (that's 0.1%).

[hvpfpleb49]

The active delta hedging your'e trying to do, should be linked at the actual delta your total position has. The higher the Implied Vol should mean you can let the stock move a bit further away.

Anyway, good luck with 24/7 markets... there's no way you can get that sorted. Even if trading the underlying stock on an overseas market in the after hours, you will eventually have to trade out.

[HixOraspcrari]

Thank you for your analysis.
As clearly stated in the text, this system does not use delta-hedging; instead it uses a new kind of hedging called "entry-level hedging".
So, the delta plays no role here at all.

[hhpclxoh35]

It is only at the entry price level. If the current price is away then it doesnt't have any impact on the system.
I think the too-many-crossings-problem is a solvable problem.