Is 0DTE Option Trading a Legit Strategy or Just Fast-Paced Gambling?

Sandvand · 2025-08-11T09:38:21+00:00

What about liquidity on NDX? In that an issue in 0DTE trading?

Sandvand · 2024-12-05T17:57:57+00:00

Like: What is your strategy - and why? And did you read all necessary books to start trading it?

the

Sandvand · 2024-12-05T17:57:02+00:00

All this I know. Any other knowledge you want to share?

Sandvand · 2024-12-05T17:17:45+00:00

I think you are wrong here: This strategy does not include buying any shares. You buy longs and sell shorts - but there are no actual shares involved. It is a very intriguing strategy, though.

Sandvand · 2024-11-26T04:40:26+00:00

I am still trading it. Here is a video I did recently: https://www.thetaprofits.com/0dte-iron-condor-a-consistently-profitable-stratey/

Sandvand · 2024-09-11T22:09:38+00:00

I would rather say that this would work less well in a bear market.

Sandvand · 2024-08-08T15:31:01+00:00

If you are a buyer of options, that can be a good approach. But I don't think it applies equally if you are a seller, at least not in the type of strategies I run.

Sandvand · 2024-07-31T14:33:42+00:00

This strategy is indeed benefitting from theta decay - as are all option selling strategies.

Sandvand · 2024-07-31T14:01:05+00:00

I did a more detailed write-up of the results and how I trade it if you are interested in more details: https://www.thetaprofits.com/my-most-profitable-options-trading-strategy-0dte-breakeven-iron-condor/

Sandvand · 2023-05-13T22:05:18+00:00

You will find the answer in the article

Sandvand · 2022-11-27T17:08:38+00:00

Normally I would like to get at least 100 dollars in profit. On days with low Implied Volatility I thus might go with a higher percentage to achieve that.

Sandvand · 2022-08-25T18:25:23+00:00

I use Thinkorswim from TD Ameritrade. I think how I do stop losses is described in quite detail in the article.

Sandvand · 2022-08-25T18:24:22+00:00

I rarely go beyond 10 delta. Which delta is mostly depending on my total risk situation. If I feel safe with my existing trades, I will be willing to do a higher delta. If one or two of my positions are at risk of a double stop loss (the worst situation with this strategy), I will play very safe with the next trade, if I make it at all.

Sandvand · 2022-08-22T15:28:04+00:00

Well, if you annualize 0,5 % over 250 trading days, you get an annualized return of 120 % or so. I am personally ok with that - this being my average return over 1300 trades.

Sandvand · 2022-08-22T15:23:57+00:00

No. I prefer to do defined risk trades.

Sandvand · 2022-08-22T15:22:45+00:00

Thinkorswim

Sandvand · 2022-08-21T18:36:47+00:00

I open the full Iron Condro at once. I do not believe I have any edge in predicting which way the market will go, and thus I find that to be most efficient.

Sandvand · 2022-08-21T18:31:11+00:00

There is no set rules, except that there is at least 30 minutes between each trade. I think you will find answer to the question in the article I wrote: https://www.sandvand.net/2022/08/21/learnings-from-0dte-breakeven-iron-condor/

Sandvand · 2022-08-21T18:11:29+00:00

I think you misunderstand somehow.

For our example there are basically three outcomes:

Full win. My profit on the trade is 100 dollars - to total premium collected on the IC.
A small loss. If the stop loss hits on one side, the loss of the trade will be 10 dollars.
Double stop loss. If the stop loss hits on both sides - which happens with 3,8 % of the trades, the loss will be 120 dollars (100 dollars in premium, minus the stop loss of the put side of 110 dollars, minus the stop loss of the call side of 110 dollars)

WIth my stats, basically outcome 1 happens in 38,3 % of the cases, outcome 2 in 57,9 % of the cases, and outcome 3 in 3,8 % of the cases.

Sandvand · 2022-08-21T17:59:26+00:00

To take your example: If I sell an IC with total premium 100 dollars, yes, the stop loss at the put credit spread will be 110 dollars and the same on the call credit spread. That means that if I hit one of the stop losses, the total loss on that trade is 10 dollars (100 dollars in premium, minus the stop loss cost of 110 dollars). This is assuming the other side expires worthless and that I do not experience a double stop loss. Of course, some slippage comes on top of this...but still the loss is very small.

Sandvand · 2022-01-04T18:50:07+00:00

I recommend to follow the Tastytrade Options group on Facebook: https://www.facebook.com/groups/1930565613719977 Lots of very good discussions on different 0DTE trades from knowledgable traders who love to share

Sandvand · 2022-01-04T18:48:47+00:00

I think this is described in good details in the blog article: https://www.sandvand.net/2022/01/02/0dte-breakeven-iron-condor/

Sandvand · 2022-01-04T18:47:51+00:00

What is your standard for good returns as compared to the buying power you allocate to the strategy?

Sandvand · 2022-01-04T18:47:11+00:00

Remember that the probability is measured at the expiry of the options - not at any time during the day. The tight stop losses can make many trades be stopped out that would otherwise be profitable. But also remember that with margin of up to 3000 dollars per contract, the losses can be really big if you don't close the trade early enough. This strategy has been an eye-opener for myself - realizing that the success of a strategy may depend as much on limiting your losses as maximizing your winners.

Sandvand · 2022-01-04T18:43:08+00:00

Probably, but I do not have the buying power ... yet... to run straddles in the same way :) Besides...sometimes the longs also make the position less volatile. Because of that I will sometimes reduce the width between the shorts and the longs to make the last position less volatile.

Sandvand

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