I've recently signed on with a guru who's doing very well in recommending credit spreads.
But he always recommends closing them out at 50% of the profit that would be made at expiration.
OK, that's surely safe, but is there any back-testing data or theory that suggests that routinely giving up 50% of potential profit is in any way optimal?
Are there any platforms that will let me set a stop-loss order based on the current hedge value?
I'm using Schwab and StreetSmartEdge, and AFAIK they don't allow that, so if I wanted to use that criterion I'd have to calculate that throughout the trading day for each of my positions (based on delayed data)
Submitted September 29, 2020 at 07:40PM by bsmdphdjd