About this template
This bot is heavily inspired by episode 61 featuring Cameron Skinner with some tweaks for a smaller account.
His strategy is to sell put credit spreads 10% below the market 60 days out on RUT or SPX whichever gives the better credit--every single day. Yes, he has a lot of capital. The spread is closed after 30 days. There is no filter for a high VIX; these are sold every market day of the year. He even talks about when the market drops he calmly sells another credit spread (likely for much more credit than yesterday's spread due to the drop). The long put he buys to complete the spread is one, two or three strikes away. He also sells some call credit spreads in high volatility on VIX if I remember right. He averages 22% returns for several years and acknowledges you must treat it like a business as there are losing months. Listen to the podcast if you're curious; he tells you in detail.
Now, I have a smaller account but I really liked this strategy. So I tweaked it a bit for a smaller account and created this bot which I've been paper trading since July 13, 2021.
Here are my tweaks:
1) This bot only opens a new spread when the market drops 1% or more (I can't have 20+ spreads open at once) at 3:30 ET.
2) This bot uses a $10 wide spread (I can't specify one, two or three strikes wide). $1000 Margin required per position.
3) This bot uses IWM for the market/underlying.
4) Take a quick profit of 50% if it's seen in the first 6 days (to allow more positions to be opened)
5) Closes the position if it hits a 3x loss.
6) Closes the position if the price drops below the short strike.
7) There's no call credit spreads in this bot
The default is to allow 5 positions at once, so $5000 margin required when it has 5 positions open.
Note: you could tweak this bot to trade closer to his strategy IF you have the capital. Each bot is limited to 10 symbols but you could clone it 3 times and make bot1 run on Mon and Tue, bot2 run on Wed and Thursday, and bot 3 run on Friday (I assume you can choose a schedule like this with the platform). You'd just want to change the schedule of the event "Open ShortPutSpread 60DTE 10% Below Market" in each of the bots to match something like the schedule above. You'd want to also remove the tweaks I added to trade closer to the true strategy (i.e., in the monitor, delete the node in the decision tree that checks for quick profit--50% return in 6 days--and all nodes below it). Note, in the episode, he's willing to take a full loss on the positions and doesn't specify he closes the spread to avoid risk of assignment if the price ends up between the short strike and the long strike or the underlying touches of the short strike.
NOTE: You'll want to make sure you don't over allocate this bot. When omicron news hit (Nov 26), you can see the effect of volatility.
