Why I trade SPX 0DTE

Spectre
Jan 18, 2024
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Here are the top reasons:

  • Leverage - Every week I will find trades for at least 100% gain but regularly 300% and occasionally 1000-2000%.

  • Time - Trades usually last less than 2 hours to get the results. No overnight risk.

  • Math - I have an incredible advantage due to my experience and my levels and Math let’s me take advantage of that.

So let’s Review:

Leverage

Let’s use a 100k account example. One can risk $1k of the account, to grow the account anywhere from 1-10%. Do that 20 times a year and I’ve easily beat most funds out there . There are over 220 trading days a year.

Here are a few examples of recent trades: (I’ll add examples over time)

  • 2024-01-17
    Contract: SPX 4730c
    Entry: 1.20
    Exit: 3, 4, 10, high: 12

    Return: 400%+
    Time in trade: 30min or less

  • 2024-01-17

    Contract: SPX 4740c
    Entry: 0.20
    Exit: 2, high: 2.80

    Return: 900%
    Time in trade: 30min or less

Time

As you can see in the examples above. The time in the trades was 30minutes or less. 90% of my trades are usually under 2 hours.

Given the way the markets move, I don’t have to watch screens all day. I usually set alerts at key levels and times and check in on market to see if price action aligns with my levels or thesis. I can then use Edge Trade Planner to quickly determine my risk/reward.

Math

So with any trading strategy, you want to be able to have measurable returns. I underpeform vs the opportunities I see everyday, but the power of math can’t be underestimated. Math let’s me take advantage of the balance of time, premium, momentum to steal money from the market.

I can take trades that I know will go to 0 by end of the day but I can enter for say $0.50 and sell for 2-4 before it gets to 0. There isn’t guessing, it is math that let’s me extract that money.

Why I Trade SPX vs SPY

So you might be wondering why I trade SPX instead of SPY since it also has 0DTE contracts now.

  • Settlement. SPX is cash settled and there is no risk of margin calls or getting exercised.

  • Avoid Broker issues. I’ve had brokers close out ODTE trades during the last hour to manage their own risk. I’ve also for the same reason, had them prevent opening a trade during the last hour. As you know that last hour is where I’ve sometimes made 10x gains

Dangers

black and yellow poison sign
Photo by Mikael Seegen on Unsplash

Anyone wanting to “gamble” / trade this highly lucrative environment must know the dangers. Capital and Risk Management is essential.

Trading SPX 0DTE takes a ton of patience and planning. Patience for entries and exits. There are significant gains and losses that can be incurred.

Once you are on the wrong side of time and direction, A contract can easily go to 0 and I have lost my entire position multiple times

A news event or choppy action can easily trigger a 50-80% loss within minutes.

Next steps

Get on the waitlist for SPX 0DTE Alerts

Get on the waitlist for the Intro to SPX 0DTE Options course.