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In the name of full transparency, I would like to address some issues regarding SteadyOptions recent performance. I will separate the analysis into several separate posts. Our performance in the recent months is not in line with our long term returns, as everyone can see on the performance page. The main reasons for the recent underperformance: We are struggling with a change in the fundamental behavior of volatility at the moment. Our trades rely on RV and therefore also IV and this has not been acting as expected. Periods of extended VIX decline have always been some of our worst performers. The main problem now is that we have been in a long period of VIX decline that’s been going for months - there have been a few spikes but in general VIX has gone from 30+ to the 20’s to the mid teens (and making things worse is many periods of minimal stock price movement during this timeframe). Our core trades do well when volatility is stable or rises. When volatility started to drop, it created some large percentage losers on a few trades that had an oversized negative impact on the portfolio performance. We had much less trades in 2025, which made the impact of those larger losses bigger. We had less trades because some options became very expensive, so it became difficult for many trades to fit into a $1K allocation, and for many stocks with moderate liquidity in normal times, now had less liquidity and very wide bid/ask spreads. This made them much more risky to use for options trades as slippage was a big concern. We used some directional trades, and the stocks did not follow historical patterns in those trades. When a directional trade goes against you, losses can grow very quickly. This is what happened with TTD, XYZ, KO, FL etc. Some of the non directional trades also experienced outsized losses. We will reduce the number of directional trades going forward. We used less calendars than usual because many of them were way too expensive compared to previous cycles. Now with VIX in the mid teens, we expect to trade more calendars, which is one of our best performing strategies. We are having extensive internal discussions on how to adapt to the current environment. Our strategies are designed to make money in any market. They are not guaranteed to make money, but our long term objectives are still in place. No strategy works all the time. There’s no room for ‘never’ or ‘always’ in the financial markets.

I just received this email addressing some issues SO was facing in the past. I’m not a member anymore but I was and I’m familiar with the strategies. I’m a vol trader since over 20 years so here my 5 cents. There is no fundamental change in volatility. Volatility is behaving as it always does. Volatility reflects the future expectation of movement of an underlying during a certain time frame. One important driver of Volatility are events. The bread and butter of SO, earnings events. Since Trump took office, single stock volatility also incorporates a lot of Macro Event vol and there are a lot more than normal. Best example is the one you used: SOFI. Expiry is 1st of August. Thats Trump’s Tarif deadline and that’s something effecting all businesses. Hence to the normal earnings expectations you got additional macro risk that is specifically fixed on one date. But Trump started taking some expectations out of the deadline by announcing the sending out of letters with deals about two weeks ago and about one week ago announcement of a deal with Japan and on Monday the deal with EU. Hence 1st of August premium got priced out after several parts of the big event got communicated down the road. Thats like pre earning releases. There are a lot of these Macro Events around. Hence, if you trade volatility, you need to be aware of these (extra)events and what the additional premium for these events are on top of the normal micro events. It’s ok trading on backtesting but you need to be aware of the future, hence if the future has addition risk that isn’t replicate in past comparisons. I can clearly say, the SO edge isn’t lost, you just need to be aware what expiry vols you are buying/selling and what (additional) risk they incorporate.

A move that will likely help those of you with smaller accounts, it seems PDT minimum account value is about to be reduced to 2K rather than 25K. Timing remains uncertain however. https://www.tradingview.com/news/financemagnates:723d87023094b:0-the-25k-rule-that-s-blocking-millions-from-day-trading-is-about-to-change/

I always like to use the analogy of the whole stock market. The stock market indexes produce average return of 10-12%, but that included several drawdowns of 20-30%. Some of those drawdowns lasted months or even years. Nothing goes up in a straight line. So, if you joined the stock market based on a long time return of 10-12%, would you quit if you experienced a 30% drawdown? If the answer is yes, then the stock market is not for you. If the answer is no, then SO is no different. We all would like all our trades to be winners, but we know this is not possible. We know some of the trades will be losers. Many traders think that if a trade has lost money, it was a bad trade. They try to identify what errors they made that lead to losses. Why? "Because I lost money! So surely I have made a mistake somewhere?” Was it the right conclusion? Is any losing trade necessarily a bad trade? The answer is no. No matter how well he executed his trade, there will be losing trades because we are playing a probability game. Trading is a business based on probability. And probability means that sometimes we get what we want, sometimes we don't. And that's the nature of this business. The sooner we accept this, the better we can operate it as a business. To put things in perspective, our model portfolio was up 10% in the first half of 2025. We had few bad trades in July and those put us back few percentage points. While those returns are way lower than expected, they are not the end of the world. We will refine our strategies going forward and I encourage everyone to look at the big picture. It is important to note that consistency in trading is important rather than changing everything when you get an adverse movement. Adaptation rather than revolution over time is the right way to go. Have our strategies lost their edge? This question has been asked many times over the years, basically every time we have a period of dull returns, and the answer each time has been "no, they have not". I believe this time is no different. Profits come in bunches. The trick when going sideways between home runs is not to lose too much in between - Michael Covel Since inception we had 13 months that produced 20%+ returns, and over 30 months that produced 10-20% returns. To win you've got to stay in the game. Our strategies worked very well for us for over a decade, and we have full confidence that they will continue working in the future. Those who have the patience will be greatly rewarded, like in the last 13 years. Members who have been with us from the very beginning know it very well.

think my response would have been, "i know a guaranteed way to have an account balance of 1.25 million your first year of trading.. start with 2.5 million and quit when you reach 1.25. many have done it, so can you." HA!

If I had to select one thing that causes most traders to fail, it would be wrong expectations. I know I sound like a broken record, but consider this: when someone wants to become and engineer or an accountant, do they expect to achieve this in a few months? No, they fully expect spending at least 4 years and tends of thousands of dollars in University (not to mention becoming a doctor or a lawyer). And yet, many people read all the hype and expect becoming experts after a few months. When I just started SO, I got an email from one of my Seeking Alpha readers. He told me that he is a big fan of my articles and asked how he can learn more. He wanted to make it his new career. He asked me if I can recommend any books or internet sites to learn/practice the options strategies. Then he said that he is new to trading options, he set aside a small amount of money in hopes of doubling it at least yearly. Don't you find it amazing? The guy admits he is new to options, but wants to double the account "at least yearly". My reply was: "There is a lot of hype surrounding options trading. Some "gurus" out there will make you to believe that doubling your account every 6-12 months is an easy task. If it was, we all would be millionaires by now. My advice to you: if you just start options trading, preserving your capital during your first year of trading would be a great achievement" I didn't hear from him since then. He probably went to one of those charlatans who promise to double your account in one month and charge you few thousand dollars for a week of “one on one consulting”. Many people will tell you what you want to hear to get your hard earned money. Here is another email from one of our former members: "I'm new to options trading. I'm retired and am hoping to make $1.25 million per year by trading" This member cancelled after just 2 weeks. Why I'm not surprised? And honestly, I would be very interested to know the psychology behind people thinking they can have no experience with something, probably not even know how to place an order, and start making money with options right away. A 7 figure income in this case. But maybe it's the same psychology that makes people to believe that they can lose 50 pounds in 2 months without any effort..

In addition to @InvestTrader, something else that dovetails into position size. Don't "day trade" your positions, and if you are, then ask the nice nurse for another shot and go back to your computer. Seriously, what I mean is, if I have a position open that is getting beat up, I try not to focus on the chart constantly, watching it's every move, this very often leads to me closing or altering the position, in other words, over trading. Sure, there are times I must focus on as specific trade/ticker, but I don't have the temperament to watch the screen, filled with angst like a day trader, finger hovering over the send button. And yet, I still often do it, so I have to constantly control that tendency. I think that one thing has cost me more money than any other.

Profits come in bunches. The trick when going sideways between home runs is not to lose too much in between - Michael Covel I keep repeating this quote again and again, just look at latest Simple Spreads performance. Every drawdown in S&P 500 was followed by a monster rally (it is now up over 30% from its April lows in just 3 months). Every time SO was "underperforming" for a few months, was following by a monster year.

Great analysis, and with candor and transparency, too. Thank, Kim. The comment about directional trades did resonate with me, as I have been watching them from the sidelines, or had modified my own trade away from the official. Directional trades probably have their place in a basket of strategies. However when they deviate from the core thesis, it's a red flag for me. Many such trades started out delta positive right off the bat, with no (or not enough) room for error - just the hope that the stock would revert if it went south (pun intended). Somewhere in my basket of wisecracks is a saying that goes "Hope is not a strategy". In such cases I tended to stick with the original thesis, which worked better, or at least add a simple hedge - one that is understandable by the lay person - kind of like like we do with our Double Diagonals, where a calendar is added to mitigate the non-movement of the stock. Taking the loss on a bad trade and moving on is another thing that traders tend to postpone, and then find themselves in trouble. The persistent red values in the daily trade log that present themselves hour after hour and day after day tend to make traders obsess over recovering from them which takes away time from finding potentially successful new trades. Someone had mentioned a while ago, and I agree whole-heartedly, that there is a psychological cost to staring at ugly red losses on a continuous basis. I personally tried this "different" discipline earlier - that is, mostly sticking to the defined max loss and/or profit targets - and my trading became more fulfilling, the losses smaller in number and value, and profitable trades more numerous. Even the moments of depression were fleeting when the closed losing trades were put aside in the cumulative trade log, leaving the active log looking a whole lot healthier. The wonderful thing about SO is the thinking, back-testing, discussion and evolution that have formed all the core strategies, and this time is no exception, I'm sure.

All well said! A couple of things based on experience: - Trade style should match your trade personality and trade character. (Are you are day trader or swing trader/position trader?) - Options Education (Do you understand your max risk or exposure before a trade is placed?) - Volatility response (Matches rule 1, but you have to experience it to know how much volatility you can handle.) No paper trades - Profitability Goal (Yes, options/trade education is important. However, if it doesn't transform to profitability then it's a total hype and/or waste of time) - Options trading is not the holy grain of stock trading/investing. (Options trading should be one of the tools used as part of a multiple-faceted approach to investment profitability) - Less is more (Overtrading is a real thing and it has the potential of diminishing profitability in the long run) - Compementary trading systems help smoothen the curve. (Find two complementary systems that help smoothen the volatility curve and work out a combination or ratio that suits your investment goal) - It's ok to pivot when necessary (Options trading isn't for everyone. It's ok to give it a try and admit if it's your thing or not.) Pivoting to a profitable system is great. Whether that's an options based system, combination of both, or not is ok. - Stick with what works (Keep it simple. Stick to what works for you and make it the bread and butter of your system. Everyone gets that hunch to experiment, keep it nimble and in a separate account)

That reminds me of the Irish farmer who won the lotto. When asked what he would do with the money. He said I'll keep farming until it is all gone.😀

Hi June I see you joined yesterday. You have plenty of posts to learn. There is wealth of knowledge here. Three years is not enough to be profitable trader. It takes 10+ years to be a really profitable trader in most market conditions. Take your time and be prepared for long haul. I have been through 3-4 liquidation events in my career and still trading and going strong even in todays challenging times. You need passion . With passion and perseverance and guidance and hope and discipline and hard work and courage and tiny amount of luck , you can join the elite club of consistently profitable traders who depend on trading for their day to day living.

Non-directional, volatility-based trades will not drive you crazy. In retrospect on my trading journey, I should have just done what I knew would bring profit from square one as opposed to chasing larger gains. Then just watch the markets until you fully grasp how they move and wait for opportunities. If you can't afford to lose, don't trade it. More conservative trading is better, and take profits when you can. There's so much noise out there with trading that if you find something that works, stick with it because often those are few and far between. I have some 59-day SPY spreads right now and am using SteadyOptions trades as a hedge. I will tell you that it is downright uncomfortable holding through this volatility and uncertainty. It will make you just not want to trade independently. I'm just barely profitable at this point, but much more competent than most, well educated, and exceptionally aware of macroeconomic conditions... most of my losses are attributable to not watching the market for long enough and following bad alerts. Just follow SteadyOptions from square one is the best advice I have for you, and then continue learning from there.

90% if success of failure in trading/investing is related to psychology, human emotions and discipline. Even investors who simply buy an index fund or a mutual fund will have very different results, depending on how they do it. Here are some articles that might help: Probability Vs. Certainty Trap Are You EMOTIONALLY Ready To Lose? Are You Ready For The Learning Curve? Why Retail Investors Lose Money In The Stock Market Why Simple Isn’t Easy Thinking In Terms Of Decades Can you double your account every six months? Is Timeframe Your Biggest Mistake? Are You Following "Tharp Think" Rules? Top 10 Mistakes New Option Traders Make Price Of Options Trading Education How To Become A More Profitable Trader 5 Stages Traders Go Through 10 Fatal Mistakes Traders Make Learning To Win By Learning To Lose How To Avoid Emotional Mistakes In Trading 10,000 Hours Of Trading Bitcoin: The Greater Fool Theory? Investor Discipline Is The Key To Success Buy High, Sell Low: Why Investors Fail How To Control Losses And Protect Profits 10 Tips: Trade Options Like A Pro And Keep Your Day Job

This is because VIX is high, you can adjust this by going into Settings and changing (or by simply clicking on this cycle in the legend to show it)...

To provide a few examples to show how our strategies have zero correlation with the markets: Apr.2024: S&P 500 -4.2% SteadyOptions +4.6% Dec.2022: S&P 500 -5.9% SteadyOptions +2.9% Sep.2022: S&P 500 -9.3% SteadyOptions +1.7% Apr.2022: S&P 500 -8.8% SteadyOptions +4.8% Jan.2022: S&P 500 -5.3% SteadyOptions +5.7% Mar.2020: S&P 500 -12.4%, SteadyOptions +3.3% Feb.2020: S&P 500 -8.2%, SteadyOptions +26.6% Dec.2018: S&P 500 -9.2%, SteadyOptions +17.3% Feb.2018: S&P 500 -3.9%, SteadyOptions +3.7% Jan.2016: S&P 500 -5.0%, SteadyOptions +10.6% Aug.2015: S&P 500 -6.3%, SteadyOptions +11.7% Jan.2014: S&P 500 -3.6%, SteadyOptions +22.9% In 2022, S&P 500 was down 18.2% while SteadyOptions was up 90.5%. As one of our members mentioned in 2020 during the Covid market meltdown: "I would rate the 3% profit for March as even MORE successful than the 25% profits for Jan/Feb. If someone can make a profit in a month when there was total carnage in the markets, then that shows resilience and security in the trading strategies. It shows that even during a black swan event, the system works, and the account will not be blown." To provide some perspective, we already had periods of sideways returns and drawdowns in the past, followed by periods of outsized returns. Traders should think in terms of years and decades instead of weeks and months.

https://steadyoptions.com/2024_perf/

For me, finding the appropriate trade size was one of the things that had the most impact on my trading. When the trades are too large for our account or for our ability to handle a loss, the probability of panicking and making wrong decisions is enormous. For me, it is comforting to enter a trade and calmly face the worst possible scenario as something I can take or accept. This gives me the necessary tranquility to make rational and calm decisions regarding trade management. It’s often the difference between winning or losing

And this is exactly the key - Why Simple Isn’t Easy

A couple of comments related to this: For me the RV chart is the most valuable, and always will be. IV (and therefore RV) changes have closer to the same pattern each earnings cycle for the most part (more predicable). Stock price changes leading into earnings is much less predictable and just because a stock moved a lot leading up to earnings in one cycle doesn't necessarily mean it will this time. Entering trades at good RV levels with short strangle sales covering/exceeding the typical RV decline heading into earnings days is the top criteria for trade entry, IMO. The tool already has the option to display the stock price movement for prior cycles. If there is another chart of straddle performance tracking a straddle at price xxx over time, then the results can be misleading at times: I know the intent is likely to track gains due to stock price changes (gamma), but when looking at a chart like this straddle changes due to IV changes (vega) would not be readily apparent. If the trade was entered at higher IV, then straddle could show a loss even though stock price moved. Conversely, if trade was entered a good RV then straddle could show vega gain even though stock price did not move much. And vega could be an overall market thing and not stock-specific (so not repeatable from one cycle to the next). Bottom line for me is that having a chart showing past straddle price changes over time is fine... but not being able to tell how much of the change is due to gamma, vega and theta makes it not very useful to me for making a trade entry decision. Having such a chart certainly won't hurt (the more data the better), but the RV chart is the most important for trade entry decisions with the other charts providing more background.