Go Small or Go Home In our studies, we maximize the number of occurrences by trading one contract every day for the past 14 years. This provides more accurate P/L and win rates in the long run. What if, instead of selling a contract a day, we sold lamella feedStudy: Go Small or Go Home SPY, 2005-present, Closest to 45 DTE Sold 16 delta strangles Compared: ~ Selling one contract every day; max position was ~22 contracts per cycle (1 month) © Selling 22 contracts every expiration cycle Held to expiration; Managed at 21 DTE Total number of trades is roughly the same feedGo Small or Go Home Before we get to the results, it’s important to distinguish the difference between the strategies: Selling one contract every day maximizes independent occurrences, which is what tastytrade mechanics favor. Selling 22 contracts in bulk every cycle only increases the magnitude of each occurrence, but the total independent occurrences are fewer. feedaR bes Go Small or Go Home ro Maximizing independent occurrences ends up being 22% more profitable and carries only 5% of the risk compared to selling the same number of contracts all at once. SPY 45 DTE Meuse cen Sell 22 at Once Sell One Every Day Average PI/L per Contract SoH A IoYJ Dt) cab cab Volatility of Total P/L BOR Yaa S¥.on CoredGo Small or Go Home Same trend holds true when we manage early... SPY 45 DTE Tene ee ih Sell 22 at Once Sell One Every Day Average P/L per Contract xr $40 Win Rate 78% Ya Volatility of Total P/L STA) $149 feedGo Small or Go Home TAKEAWAYS: ~ Increasing number of independent occurrences means trading often. © By diversifying by duration (maximizing independent occurrences), we take less risk and make more money. feedtastytrade contents provided solely by tastytrade, Inc. 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