Shifting fom Linear Regression entries.

Given my thoughts on timeframes and cashflow issues I may have inadvertently shifted my idea from Linear Regression spread entries to the wider margin iron condors placed as cash becomes available. Seeing as the LR optimized trades are to boost yield and reduce risk they will be time sensitive in that not always will they line up when I have freshly freed up cash to trade with.

Looking back on LR setups I can have cash in place all the time but can I have maximum cash in play constantly?

What is the reduction in cashflow as I average the daily trading over the entire capital base and total time period and include those days or weeks that I have some or all of my cash sitting idle?

What is the effect of applied savings to the account balance to enable larger positions in my trading rather than relying strictly on account growth? This is something that I completely overlook when I study returns and something that I should not overlook.

Re-visiting the cashflow vs yield issue...beating a dead horse yet?

There are a myriad of other issues and ideas that I could look at to apply toward my trading in future. I figure that, seeing as I am cashflow targeted now, I should consider at least these fresher ideas.

Applied savings is probably larger than I anticipate. I can easily setup automatic transfers to my Questrade trading account in what ever denomination I feel that I can manage. Use it in place of a savings account in the sense that I can also withdraw as easily...seeing as my trading is no longer registered account based.

Is this safe? Given the wider margin and lower accepted daily yield I believe that it is safe enough. I will need to apply some exit strategy rules to allow safety margins over and above the strike from price spacing. Also this savings is usually used to buy "extras" other than groceries, paying bills and the like so if I all of a sudden I lost it all it would not be sorely missed. Besides, the likelihood of that happening is really small.

Applying this additional capital on a regular basis allows me to up the trading base by a few contracts at a time with each transfer thus increasing the cashflow regularly. I have not done any forecasting to include this at all so I am unsure of the final effect overall, but it may offset the effect of using linear regression entries somewhat if that is not already offset by keeping total cash in play all the time.

Using sort timeframes, under 30 days, means that I could break my capital in two chunks and use half for the put side and half for the call side... riskier than I might like. For now I will remain with the idea of applying about $2000 per side and using the balance to apply as LR entries until I am more comfortable with the plan.

Back to cashflow again. Assuming that I apply savings, use wider margins with lower yields, keep all cash in play in one form or another and concentrate strictly on cashflow I can produce a different type of trading game. The larger base, using full capital on these trades, increases the yield due to lowering of the commission relative rate (increasing the size costs $1 per contract as opposed to another $9.95 plus $1 per contract for a new trade). Seeing at these small position sizes it makes a difference, enough that bumping up to maximum right now changes some for the strikes by $1 thus decreasing the risk factor.

This turns into a similar game as investing for dividends. "Slow and steady wins the race" as the saying goes. I still like the idea of hitting larger returns overall but I will be satisfied to see the cashflow progressively increase at a greater than the typical expectation for a dividend plan rate. That was a 30 year plan IF my timing and the stock market timing worked out perfectly... along with the company dividend plans continuing on track.

I still have three spreads tying up some capital now but they all expire on Jan 15th. Even with placing the January trade tomorrow it will expire at the same time freeing up all of my account...except for a small stock position. At that point I will review my ideas and goals and see what my next step might be.

Off to ceck out the Optioneer trade setups for tomorrow now.

Jeff.