tastytrade: Best Practices

Economic reports often make headlines, but they rarely factor into our trading decisions. This is because most reports are backwards looking and they lack statistical usefulness for a 45 day timeframe.Some of the bigger reports are worth taking note of as they can provide additional insight into current dynamics. Join Tom and Tony today as they look into what you need to know.

We have many rules about the entry and exit of trade. Some depends on trader’s risk tolerances such as delta and BPR used. Some, however are rooted in mechanics. Join Tom and Tony today as they consider rules we have for entry and exit that are mechanically-driven.

Balancing overall risk in a portfolio through some key metrics is important to successful trading. A quantitative approach to understanding an accounts profit potential is essential. Some key metrics we use include: Portfolio Beta-Weighted Delta Extrinsic Value Overall POP Join Tom and Tony today as they walk through each concept in detail.

Understanding how to evaluate and manage risk is essential when trading. Today Tom and Tony consider ways to assess outstanding risk, and discuss actions to take to help keep it under control.

With extensive research, we have found that an active approach to managing trades early can improve both probability and profitability. X(around 21 days to expiration) as opposed to holding contracts to expiration.

Most trades and strategies we implement are based on the current implied volatility rank (IVR). It is in fact the first metric shown on the tastyworks platform.  Join Tom and Tony today as they reveal how to use this important trading metric.

To maintain consistency while balancing risk we follow a logical approach to trade decisions. This is done by considering the statistical facts combined with a developed market awareness.

An important part of our strategic approach is having an effective way to make critical trade decisions that are necessary to creating consistency in our portfolio while efficiently managing risk.Join Tom and Tony today as they discuss how this can be accomplished by using a framework to make decisions that are based on established mechanics.

With the use of statistical analysis an options trade comes alive with a wealth of information that provides context that we can use to make decisions. A valuable part of this analysis is the calculation of various probabilistic outcomes. Join Tom and Tony today as they review some of the probability metrics we use that are at the core of our quantitative approach to trading.

Options have a defined amount of time until they expire. The days until expiration (DTE) plays an important role in the pricing of options and our trading strategy. Join Tom and Tony today as they cover the ways we look to optimize strategy around time.

Some may find that trading their own account is a mixture of being rewarding, challenging, educational, and empowering. Trading however does not need to be a full time job. Join Tom and Tony today as they cover ways to stay on top of your account with time saving tips.

Options are versatile trading vehicles, and the strategies we trade can generate profit in several different ways. Join Tom and Tony today as they examine some of the main factors that help to drive P/L.

The new year is a good time to set goals and make adjustments to trading strategy. Join Tom and Tony today as they review key trade parameters to control risk and keep our portfolios on track in 2022.