The Trade Busters 36 - Trinity System, Part 1: The Theta Engine
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Oct 20, 2021 The hosts introduce the Trinity trading system and its core component, the theta engine. They discuss trading strategy parameters and position management, balancing factors and monitoring risk in options trading, the importance of adjusting positions in the theta engine strategy, and building and maintaining a book. They also mention future plans for the podcast.
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Three-Part Trading Framework
- The Trinity System bundles a core income generator with optional hedges to form a comprehensive trading campaign.
- The theta engine is the primary profit driver while the Bomb Shelter and a third hedge are complementary and optional.
Theta Engine As Ongoing Income
- The theta engine refers to a 45+ DTE premium-selling campaign focused on persistent theta generation.
- Treat the strategy as an ongoing income engine rather than discrete trades to maximize long-term returns.
Don't Cap DTE; Monitor Book Size
- Avoid hard caps on position age to maximize premium capture rate and PCR.
- Monitor book size and maturities since staggered positions reduce correlated risk across the book.