“Nothing will ever be attempted if all possible objections must first be overcome.”
-Samuel Johnson, 1709 – 1784

All right, time to admit that it’s way easier to stick to a strategy if I have some oversight. Since the last update several months ago, I tried a new strategy for options. Honestly, I started that account because I was bored at work and wanted to gamble a bit, I had no idea that I stumbled upon a potentially viable strategy. I really need to improve my personal debt/equity ratio before I start trading again, so now seems a good time to go back, test and refine “Balance” and this new put strategy, “Bet on Red”.

I’ll be using Interactive Brokers paper trading account, with an initial value of $250,000. Both strategies are still being tested, so I’ll allocate $125k to each strategy. For “Balance”, I’ll be trading BTC and ETH. They’re available on IBKR’s fairly limited list of crypto, I like the mission of both, and they have proven to be pretty resilient. To quickly recap, “Balance” is designed to use the volatility in crypto assets to my advantage. My target volume is 1% of account value per day. If the spot price is below my average basis (or if I have no open positions) I’ll buy to reduce my average cost. If the spot price is above that average, I’ll sell to take profit.

For “Bet on Red” I’ll be using TradingView’s stock screener to find companies with a Current Ratio below 1 and an Earnings per Share ( EPS ) below 0. This combination means that the company owes more than it can pay, and the money they need to keep going isn’t coming in from earnings . To use a personal finance analogy, the corporation is to the point of putting the electric bill on their credit card. They’re not completely screwed, but at a very uncomfortable level of broke. Such an unconstrained search usually turns up more results than are practically useful – I’ll explain how I pair down the list on a case-by-case basis. I’ll be looking for put options with an expiration date at least one year in the future, and take the strike price closest to the spot price when the trade is sent.

I think TradingView’s commitment to open source is awesome, and I’ll try to make my notes, strategies and trades as accessible as possible. All of my trades will be published through Google Sheets, just send me a message and I’ll gladly send a link. I’ll grab price data while markets are closed and add analysis as it’s being done. If these help you on your own trading journey, please let me know! Always glad to know I’m being helpful and hear success stories from others. I can be reached here or @Fluxdesk on Telegram. I’d be glad to hear from you all, happy trading!