{"id":5257,"date":"2018-05-31T13:07:50","date_gmt":"2018-05-31T17:07:50","guid":{"rendered":"http:\/\/www.morpheustrading.com\/blog\/?p=5257"},"modified":"2022-04-06T15:04:59","modified_gmt":"2022-04-06T19:04:59","slug":"etf-options-trading-strategy","status":"publish","type":"post","link":"https:\/\/morpheustrading.com\/blog\/etf-options-trading-strategy\/","title":{"rendered":"ETF Options Trading: Remember It&#8217;s Never The Same Day Twice!"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">TABLE OF CONTENTS<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/morpheustrading.com\/blog\/etf-options-trading-strategy\/#Last_week_I_was_contemplating_my_recent_ETF_options_trading_performance_because_it_seemed_less_satisfactory_than_my_prior_years_performance\" >Last week, I was contemplating my recent ETF options trading performance because it seemed less satisfactory than my prior year&#8217;s performance.<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/morpheustrading.com\/blog\/etf-options-trading-strategy\/#Never_The_Same_Day_Twice\" >Never The Same Day Twice<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/morpheustrading.com\/blog\/etf-options-trading-strategy\/#Calling_An_Audible\" >Calling An Audible<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/morpheustrading.com\/blog\/etf-options-trading-strategy\/#Consistency_Pays_Big_Dividends\" >Consistency Pays Big Dividends<\/a><\/li><\/ul><\/nav><\/div>\n<h2><span class=\"ez-toc-section\" id=\"Last_week_I_was_contemplating_my_recent_ETF_options_trading_performance_because_it_seemed_less_satisfactory_than_my_prior_years_performance\"><\/span><img decoding=\"async\" class=\"alignright\" src=\"https:\/\/www.morpheustrading.com\/blog\/wp-content\/uploads\/2018\/05\/consistent-profits.jpg\" alt=\"consistent-etf-options-profits\" title=\"\"><br \/>\nLast week, I was contemplating my recent ETF options trading performance because it seemed less satisfactory than my prior year&#8217;s performance.<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>I was still feeling pretty good because of locking in $65,000 in ETF trading profits over the past 30 days, but that winning run followed what I thought was a dismal January\/February.<\/p>\n<p>Instead of merely guessing about my recent trading performance, I took the time to run the numbers and analyze my key trading statistics.<\/p>\n<p>After all, <a href=\"https:\/\/www.morpheustrading.com\/blog\/profitable-stock-trading\/\" target=\"_blank\" rel=\"noopener\">winning in the stock market always boils down to simple math<\/a>.<\/p>\n<p>Upon reviewing my trade stats, I discovered there was nothing wrong.<\/p>\n<p>I simply failed to remember <em>it&#8217;s never the same day twice!<\/em><\/p>\n<p>Continue reading for an insightful mini lesson to newbies and a fantastic reminder to experienced traders.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Never_The_Same_Day_Twice\"><\/span>Never The Same Day Twice<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>After cozying up with a spreadsheet to analyze my stats, I found my average profit per trade over the past couple of months (including all winners <em>and<\/em> losers) was only +12%.<\/p>\n<p>This was not so great compared to my average gain of around 20% per ETF option trade in the first six months of the previous year.<\/p>\n<p>Had I lost my touch?<\/p>\n<p>Not at all!<\/p>\n<p>I realized I had simply fallen victim to the faulty thinking that the current stock market is the same as what I was dealing with before.<\/p>\n<p>In actuality, I needed to remind myself that EVERY day in the stock market is unique &#8212;<em> it can never be the same day twice!<\/em><\/p>\n<p>Since <a href=\"https:\/\/www.morpheustrading.com\/blog\/etf-swing-trading-strategy\/\" target=\"_blank\" rel=\"noopener\">my ETF swing trading strategy<\/a> focuses on a single chart pattern with specific rules, it is easy to mistakenly assume my results will always be the same.<\/p>\n<p>But this year&#8217;s stock market required me to make some tweaks to the implementation of my two options strategies.<\/p>\n<p><em>And it&#8217;s starting to pay off.<\/em><\/p>\n<p><img decoding=\"async\" class=\"aligncenter\" src=\"https:\/\/www.morpheustrading.com\/blog\/wp-content\/uploads\/2018\/05\/calling-audible.jpg\" alt=\"audible-etf-options-trades\" title=\"\"><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Calling_An_Audible\"><\/span>Calling An Audible<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>A few years ago, I began sharing the <a href=\"https:\/\/etfswingtrader.net\/etf-swing-trading-newsletter\" target=\"_blank\" rel=\"noopener\">ETF options trades<\/a> I was using to amplify the profit from my existing ETF trade setups.<\/p>\n<p>It was an aggressive approach I called <i>ETF-ATM <\/i>and my trades started averaging +20% profit per swing trade, with a win rate around 85%.<\/p>\n<p>Although the profit performance was great, these trades were quite volatile \u2013 as options trades usually are.<\/p>\n<p>Further, I could only carry out this options trading strategy on about half of my ETF trade setups.<\/p>\n<p>As such, I came up with a more conservative strategy named <em>ETF-RS<\/em> that could be applied to almost ALL of my ETF setups.<i><br \/>\n<\/i><\/p>\n<p>This new ETF swing trading strategy only generated about half the profits of my ETF-ATM system (+10% per trade), but was much less volatile &#8212; less stomach churning.<\/p>\n<p><strong>And here lies the clue to the difference in my options trading performance this year.<\/strong><\/p>\n<p>We had a tough pullback in the market in January\/February and I got hit with some personal trading losses.<\/p>\n<p>Normally, there are enough ETF options setups that I just trade more often to make up the losses.<\/p>\n<p>However, the market&#8217;s character this year was providing me with fewer setups than usual.<\/p>\n<p>I wasn\u2019t making my money back fast enough.<\/p>\n<p>That&#8217;s when I made a strategic decision to \u201ccall an audible,\u201d just as a football quarterback might do when facing a surprise defense formation.<\/p>\n<p>I began doing options trades on <i>every<\/i> ETF trade setup I could, requiring me to use my less profitable ETF-RS strategy more often than last year.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Consistency_Pays_Big_Dividends\"><\/span>Consistency Pays Big Dividends<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>It is true my average profit per ETF options trade is lower this year, but I have compensated by adding more ETF options trades.<\/p>\n<p>On the table below, you can see from the dollar results that I have actually increased my total options profits.<\/p>\n<p>I was more aggressive about using my less aggressive strategy \u2013 and the tweak has paid off.<\/p>\n<p>Below is a list of all ETF options trades posted for subscribers of my<strong> <a href=\"https:\/\/etfswingtrader.net\/etf-swing-trading-newsletter\" target=\"_blank\" rel=\"noopener\">ETF swing trading newsletter<\/a><\/strong> so far this year:<\/p>\n<figure id=\"attachment_5270\" aria-describedby=\"caption-attachment-5270\" style=\"width: 675px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-5270\" src=\"https:\/\/www.morpheustrading.com\/blog\/wp-content\/uploads\/2018\/05\/2018-etf-options-trades-stats.png\" alt=\"\" width=\"675\" height=\"818\" title=\"\" srcset=\"https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2018\/05\/2018-etf-options-trades-stats-91x110.png 91w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2018\/05\/2018-etf-options-trades-stats-248x300.png 248w\" sizes=\"auto, (max-width: 675px) 100vw, 675px\" \/><figcaption id=\"caption-attachment-5270\" class=\"wp-caption-text\">Jack&#8217;s ETF options trades<\/figcaption><\/figure>\n<p>&nbsp;<\/p>\n<p>The stock market is an ever-changing master that presents us with a different haiku every few months.<\/p>\n<p>However, you can still generate consistent profits by simply following a sound trading strategy that is methodically implemented again and again.<\/p>\n<p>As I&#8217;ve said in the past, my ETF trading strategy is actually <a href=\"https:\/\/www.morpheustrading.com\/blog\/etf-swing-trading-strategy\/\" target=\"_blank\" rel=\"noopener\">pretty boring<\/a> &#8212; and boring is great when it continues to significantly increase my trading accounts each year!<\/p>\n<p>As always, feel free to personally\u00a0<a href=\"https:\/\/www.etfswingtrader.net\/contact-us\" target=\"_blank\" rel=\"noopener noreferrer\">contact me<\/a> by email <strong>or phone<\/strong> with any questions or comments.<\/p>\n<p>Jack Loftis, PhD | founder<br \/>\n<a href=\"https:\/\/etfswingtrader.net\" target=\"_blank\" rel=\"noopener\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone lazyloaded\" src=\"https:\/\/cdn2.morpheustrading.com\/blog\/wp-content\/uploads\/2017\/04\/header-logo-110x54.png\" alt=\"ETF Swing Trader - Jack Loftis\" width=\"70\" height=\"34\" data-lazy-src=\"https:\/\/cdn2.morpheustrading.com\/blog\/wp-content\/uploads\/2017\/04\/header-logo-110x54.png\" data-lazy- title=\"\"><\/a><\/p>\n<p><strong>You Don&#8217;t Know Jack?<\/strong><\/p>\n<p>Jack Loftis only trades ETFs and ETF options, each with a very specific swing trading strategy. Since 2001, Jack has been publicly sharing his trade results with more than 13,000 followers on <a href=\"https:\/\/stocktwits.com\/ETFSwingTrader\" target=\"_blank\" rel=\"noopener\">StockTwits<\/a>. Mr. Loftis generates about 10 ETF trades every month (always using the same pattern), and averages around a 90% win rate. Jack shares his trades with subscribers of his ETF swing trading service. <strong><a href=\"https:\/\/etfswingtrader.net\/etf-swing-trading-newsletter\" target=\"_blank\" rel=\"noopener\">Sign up now<\/a><\/strong> to start your trial subscription today.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Last week, I was contemplating my recent ETF options trading performance because it seemed less satisfactory than my prior year&#8217;s performance. I was still feeling pretty good because of locking in $65,000 in ETF trading profits over the past 30 days, but that winning run followed what I thought was a dismal January\/February. Instead of [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_links_to":"","_links_to_target":""},"categories":[3],"tags":[],"class_list":["post-5257","post","type-post","status-publish","format-standard","hentry","category-stock-trading-strategy"],"_links":{"self":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts\/5257","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/comments?post=5257"}],"version-history":[{"count":1,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts\/5257\/revisions"}],"predecessor-version":[{"id":11196,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts\/5257\/revisions\/11196"}],"wp:attachment":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/media?parent=5257"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/categories?post=5257"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/tags?post=5257"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}