Calendar Spread Service
The Calendar Spread Service (CS1) is based on a non-directional, reversion-to-the-mean trading strategy on a select number of highly liquid stocks such as Costco, Amgen and Goldman Sachs. This strategy sells front-week options and buys out-week/month options at the same strike price with a typical trade duration of 3 to 5 days. The calendar spread strategy takes advantage of accelerated time decay of the front-week sold contract, while the out-week/month purchased contract holds its value. All trades either expire or are typically closed by Friday of each week.
The risks to this strategy are rapid price movements of the underlying, and/or a decrease in volatility. Price movements of more than two standard deviations from the 20-day moving average are the type of moves that reduce return or can result in losses. The second risk is a decline in volatility that can happen for a variety of reasons, but the most common reason is an UP trending market. All trades that move against us will be actively managed, usually through modifying the original calendar spread into a double calendar spread. Through active management and experience, we are able to minimize the losses on losing trades, and in some cases can even reposition a losing trade back into a small gain.
How to Set Up the Autotrade Rule
The Calendar Spread Service (CS1) is currently autotraded through TD Ameritrade. This service is not offered as self-managed. The minimum amount to autotrade this service is $10,000. Autotrading is a service
where your brokerage account is traded automatically based on trade alerts
issued by Monthly Cash Thru Options.
The process to set-up a CS1 autotraded account is as follows:
Within your TDAmeritrade account, navigate to the autotrade area, select MonthlyCashThruOptions as the newsletter provider and select the “CS1 or Calendar Spread” service. Select "unit”, and then enter the number of units you would like to invest in this strategy. Selecting 1 unit denotes that you are allocating $10,000 to this service and that you need to have a minimum of $10,000 in the account. Selecting 2 units denotes that you are allocating $20,000 to this service and that you need to have a minimum of $20,000 in the account. You may select any number of units up to 20 units, or $200,000.
The MCTO Team will autotrade accounts up to $200k. If you are interested in trading more than $200k, please contact us at 408-375-9890 and we can discuss the MCTO managed funds.
The final step is to sign up as a paying subscriber to the MCTO Calendar Spread Autotrade Service. To learn more about packaging and pricing please go to the Subscribe page. Unfortunately, the 30 day free trial does not apply to auto-trade accounts; however, we do offer a $5 first month special for autotrade subscribers. To take advantage of the $5 first month offer please go here.
For Return on Investment results please go here.
To sign up for this service please go here.
To talk to someone about this service please call 877-248-7455, or email us at firstname.lastname@example.org