Research Specials LIVE

Research Special: Diversification with Time

Research Specials LIVE

Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.

Beef, James and Brick are back with another research special. Today they discuss what to do when you don’t have the option to trade options with 45 DTE. Can you combine varying expirations that average to 45 DTE?

Most of us here at TastyTrade intuitively do average our positions to around 45DTE, today we wanted to put some numbers and context around this idea. To do this we looked at selling ATM puts (managed at 50%) and straddles (managed at 25%), we looked at durations of 15DTE, 30DTE, 45DTE, 60DTE, and 75DTE. From those returns we looked at combinations of 30 and 60DTE, 15 and 75DTE, and all 5 durations averaged. The study was done from 2005 to present. Be sure to tune in to hear Beef, James and Brick breakdown the results!

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