How I Was Dead Wrong In My Analysis And Yet Still Made Money With Credit Spreads

credit spreads
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So this past month my analysis of the market has been less than favorable. Along with a whole host of other traders, I have continued to feel like the next big move down is just around the corner. Sadly enough (with the help of the FED) this market continues to push the upper limits.

You Cannot Out-Smart The Market

Just goes to show you that you still cannot out-smart the market! Thankfully, my trading style does not rely on my analysis being right. I'm sure at one point you actually believed you could out-smart the market and make a ton of money doing it? I'm sure you also learned the hard way why that's a complete load of crap.

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Odds Trading Really Works

I'm an odds and probability trader and have been for most of my career. I trade strategies that have historically proven to be successful, provide steady income and are market neutral. With these strategies you don't have to be 100% right in your timing and direction. In fact, as this video proves, you can even be 100% WRONG and still make money.


About The Author

Kirk Du Plessis

Kirk founded Option Alpha in early 2007 and currently serves as the Head Trader. Formerly an Investment Banker in the Mergers and Acquisitions Group for Deutsche Bank in New York and REIT Analyst for BB&T Capital Markets in Washington D.C., he's a Full-time Options Trader and Real Estate Investor. He's been interviewed on dozens of investing websites/podcasts and he's been seen in Barron’s Magazine, SmartMoney, and various other financial publications. Kirk currently lives in Pennsylvania (USA) with his beautiful wife and two daughters.

  • jarmst

    Well, I sold some March 880 RUT's and some DIA's 126.5's, and some SPX's 1405, so will likely be dead wrong again.

    • Kirk – Admin

      I take it you're being facetious because those look like good positions

      • jarmst

        Yes, totally facetious. Dead wrong and 100% profit with the move today anyway.

        In Nov I sold 800's for Jan, and in Feb I sold 840's. I actually closed out the RUT 840's a week ago otherwise I might be sweating it tomorrow.

        This mk't is dumbfounding. I keep watching TZA sink further and further. I guess we have to wait till June the Fed is saying.

      • Kirk – Admin

        Okay yeah that's what I thought! Thanks for the insight Jarmst!

  • vac911

    I held on to my RUT 840/850 spread because the RUT closed at 834.02 and I figured I was out of the woods. However, I've read that the "real" closing number will not be calculated until some time tomorrow based on the first tick on each of the 2000 RUT stocks. So, I could still be assigned tomorrow, right?

    • Kirk – Admin

      Yes for the index options they expire on Thursday but the since they are cash settled options (meaning no real exchange of underlying stock) they take the Friday opening prices as the final price. Technically you do have a slight chance of the RUT gapping higher but at this point it's not going to gap higher by 1% at the open.

      I think you are good! Thanks for the comment vac911 and great question!

  • kim


    Do you prefer a tracker or the index to write options?

    • Kirk – Admin

      Thanks for the question Kim! I prefer the indexes if I had to pick…the tracking ETF's like the DIA, SPY, QQQQ, IWM are also very good but obviously they will not always follow the major indexes 100%.

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