Let's Trade Options

The PDT rule is no more.
https://finance.yahoo.com/markets/op...050417843.html

Starting June 4:

The Financial Industry Regulatory Authority (FINRA) recently approved changes to its margin rules that remove the Pattern Day Trader (PDT) framework and replace it with a modern intraday margin approach. These changes are designed to give traders more flexibility while ensuring margin accounts maintain equity that aligns with their intraday market exposure.

The updated rule goes into effect on June 4, 2026 (the "Effective Date"). Although financial firms have up to 18 months for implementation (through October 20, 2027), E*TRADE expects to implement changes to align with the new requirements shortly after the Effective Date. We`ll post updates on etrade.com and in our trading apps as soon as timing details are available.

What this may mean for you:

1. Margin accounts will no longer be designated as PDT accounts, regardless of trading activity, and the $25,000 minimum equity requirement associated with PDT status will no longer apply.
2. Round-trip trades (opening and closing the same security on the same trading day) will no longer be counted.
3. Eligible cash balances, including amounts swept to bank sweep programs, will now be included in your intraday margin excess.
4. Trading that creates an intraday margin deficit (IMD)—generally, spending in excess of your intraday margin level—may result in an IMD call.
5. If your account is currently designated as PDT and subject to any PDT-related account restrictions (e.g., restrictions on opening transactions or an open day trading call), those restrictions will be removed, provided that your account meets standard margin requirements (including the $2,000 minimum equity requirement).

A Fool's errand? I don't mind these short plays, but I ain't risking much. As shown with the AM/PM diag puts, risking $630 to make $10k-$15k lol.....

https://www.cmegroup.com/media-room/...adingonma.html

transforming risk to no-risk spreads (....well, not really)

...but the guy's website is worth a look if you are new to spread trading

https://navigationtrading.com/

Mon-Tues will be looking for post-FOMC combos

bought a cheap AM/PM diagonal to fade the big Monday run, 7320/7310 SPX diag puts, for about 75c. Always a chance these Iran news based moves get reversed....

entered this combo in the hour b4 the FOMC, betting on a hawkish hold. it's up net >$2k, watching it into the close. I may close the whole thing, or 2/3...

yep....grab that cash is the game, a $2700 winner is good enough for a 2-hr trade....we'll see what tomorrow brings

why I usually close put trades whenever I see some profit in them....

FOMO. Mentality, psychology.

entered this on the dip late today, to catch a btfd next day.

Yes, and you've clearly missed it for that exact reason. Don't be oblivious. That's all I got for you, and anyone who's gonna answer your question

Options lotto has much better odds than the real lotto. Just need something to happen to spook markets a bit, over the long weekend. Combo, as shown, risks $420 to make max >$15k. Monday b/e would be 7440 early.

a decent win on the call bwf will cover the lotto puts

A good trader, with lots of content about spreads and trade management. Clear & concise, little to nothing not related to the trading topic covered. That said, I don't always agree with her. But, there's many ways to skin a cat. Something I got from this video is her use of long dated flys. I will explore...

Here's an exercise for you: construct reasonably risk-free trades using combos of spreads. (By "reasonably risk-free", I mean profitable over a sufficiently wide range.

1. Use market awareness to establish what that range is, but for example, we can use 2x the expected move.
2. Use combos - include calendars and/or diagonals @ the puts, and flys or bwf's @ the calls - use diags and bwf's to minimize cost
3. Avoid the mid-range profit dip; structure the spreads so that the theoretical profit line is >$0 across the full range
4. I like the Friday/Monday gap for time spreads, but exploring other 1-day gaps, like Mon-Tues, etc
5. Enter weekly, Mon-Wed; come off Friday or when profit target is hit
6. Profit target: aim for 40-50% the maxP of calendars/diags and same for flys & bwfs

Looking out to the Jul opex date lets me into the cheap AM/PM time spread. $360 debit caps the upside risk. As shown, lower b/e around 6920,+/-. Total maxP easily over $10k on a $50k bp stake.

I don't like tying up bp for a month. But, zooming out on trades makes time for other things. Trading 0dte's gets boring.