Last time I wrote (over a year ago!) I had shut down my old positions, topped up my account to $2500 and pretty much stopped trading to get back in the books and re-evaluate my strategies. I’m still in the books a year later but have been trading regularly and have come to a few realizations in the process.

1. I continue to believe that trading a $2500 account is not a good idea. At that funding level you’re pretty much confined to directional trades, getting lucky, or both. When it comes to selling vol in particular, I was forced to sell very narrow spreads where the wing vega was very near the body vega, ruining the point and turning into a straight (non)-direction and theta play. Hedging delta and gamma at a $2500 funding level is also impossible unless you’re playing very low priced individual names, which has it’s own set of risks.
2. Trading stock options (vs. index options) is not for me. Between liquidity risk, gap/news risk, and irregular dividends on some names, I’ve decided to stick with equity index options (SPY/QQQ) for now to try and isolate the components I’m trying to trade, which is broad market volatility and direction.
3. Smaller and wider is better than bigger and more narrow. As my portfolio has started to show some green with the current market rout, I’m finding that spreading as wide as possible to approximate a straddle/strangle flattens my delta/gamma and juices my vega/theta, making my positions more profitable as a result

All this being said, I’m at a point now where I’m comfortable that my position greeks reflect my current market views. I’ve been rolling and widening tranches of short iron condors since May of 2017 (!!!) in SPY and QQQ, slowly adding capital each month to accomplish the positions I want. Twenty points wide in both seems to be the sweet spot for me right now, and my positions range from 12 to 20 wide accordingly. I’ve got 5 and 4 lots each in SPY and QQQ respectively, all in Dec, short a fair amount of delta, flat gamma, short vega, +theta, with a good amount of room for upside movement and lots of room to the downside.

All deposits into the account (net of withdrawals since March 2017) total $8050, which is near the $10k mark I figure is best for option trading as it allows some extra capital for trading stock under the options positions. My cash & sweep is just a hair above $12k and my net liq is wrapped around $2700, which should start coming in as we get past elections and Nov expiry.

Right now the plan is to walk the wings in on my IC’s to release some buying power (targeting $0.10 total for $1 width on both sides) and withdraw any excess above $10k. I just made my first withdrawal in a loooong time of $500, which was a nice feeling. $8050 to go.