Today was anything but ordinary.
🧠 Why I Took a New Trade Today
I came across a very compelling backtest shared by the Option Omega community:
🔗 View Backtest on OptionOmega
It’s a 0DTE Friday strangle strategy, entered at 9:45 AM and exited based on quick scalps or delta-based exits. The backtest results were promising enough to warrant a small test allocation.
Since my Double Calendar strategy already deploys 40% capital each on Mondays and Tuesdays, I decided to diversify and test this strategy with just 10% capital.
It is a reverse Iron Buttefly but entered as call vertical spread and put vertical spread so that it can be closed individually based on the exit rules defined in the strategy.
⚔️ Trade 1 — Call Vertical (LOSS)
- 📅 Entry: Friday, Sep 5, 2025 – 9:45 AM ET
- 🧠 Trade Idea: Sell far OTM call, buy closer ATM call
- 🔢 Strikes: Buy 6535 C @ 9.14 | Sell 6575 C @ 0.37
- 💸 Net Debit: 8.77 × 100 × 3 = $2,631
- 💰 Exit Credit: 1.15 × 100 × 3 = $345
- ❌ Realized Loss: –$2,286
- 📉 Return: –87.2%
📉 Market moved down right after entry, and the vertical call spread had no chance to recover.
🛡️ Trade 2 — Put Vertical (WINNER)
- 📅 Entry: Friday, Sep 5, 2025 – 9:45 AM ET
- 🧠 Trade Idea: Buy ITM put, sell deep OTM put
- 🔢 Strikes: Buy 6525 P @ 9.45 | Sell 6445 P @ 0.82
- 💸 Net Debit: 8.63 × 100 × 3 = $2,589
- 💰 Exit Credit: 36.20 × 100 × 3 = $10,860
- ✅ Realized Profit: +$8,271
- 📈 Return: +319.1%
💥 One of the biggest wins so far! The market dropped hard, and this put vertical exploded in value. I exited manually at 10:22 AM.
⚖️ Net Result for the Day
- 💼 Strategy Allocation: ~10%
- 💰 Total P/L:
+ $8,271 – $2,286 = +$5,985 - 📈 Net Return: +231.2% on the allocated capital
🔍 Reflection
Even though the call spread lost big, the put spread made up for it and then some. This is a classic reminder that directional trades (like these 0DTE verticals) can be high risk and high reward. A small allocation and tight risk management are key.
I’ll continue monitoring this setup and perhaps formalize it as a Friday-only strategy with a 10% allocation. It adds diversity to my primarily neutral double calendar positions.
🔒 Risk Reminder
As always, this blog is for educational purposes only. I’m not a financial advisor. Losses and wins are part of the game, and these strategies carry substantial risk.
⚠️ Disclaimer
The information presented in this blog post is for educational and informational purposes only and is not intended as financial or investment advice. I am not a licensed financial advisor. All trading strategies discussed reflect my personal experience and are not recommendations to buy or sell any security or derivative.
Trading financial instruments such as options, futures, or stocks involves significant risk and may not be suitable for all investors. You should conduct your own research, consider your financial situation, and consult with a licensed financial advisor before making any investment decisions.
Past performance is not indicative of future results. Use of this information is at your own risk.