The Market Does What It Wants

This is the fundamental premise of my trading at The Underdog Day Trader. I trade the market as it is, today, not what I think it should be or where I hope it will go. My name is Jim Clark. My wife calls me the Underdog Day Trader. I trade 0DTE (Zero-Days-To-Expiration) vertical credit spreads in the SPX (S&P 500) and RUT (Russell 2000) indexes. I typically make 1-3 trades a day, sometimes none. There are many traders out there who are far more aggressive and make a lot more money than I do. I hope so, it makes my job easier. My trades are conservative, always wary of the market, and rules driven, aiming to generate cash incrementally, in a progression that minimizes excessive high and low swings. Losses occur, it’s the nature of the beast, and I’ve certainly had them, but a logical, repeatable approach can help to reduce losses and produce long-term positive results.

I trade only:

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0DTE vertical credit spreads in the SPX and RUT
– high liquidity
– cash-secured
– no common listings between the two indexes
– IRS Section 1256 tax treatment

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One (1) options contract per trade

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Five-point credit spreads
– keeps any loss to a maximum $500 per contract, less the premium earned by the contract, e.g., $500 loss minus $25 premium = $475 total loss on the contract.

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One trade in each direction in the same index, i.e., one vertical put spread, one vertical call spread. I once thought there was “easy money” in multiple same-direction trades, five or ten points apart. It worked a few times. But a big-percentage move in the index can plow through all those contracts and create a super-maximum loss. A perfect example is April 3, 2025, when the SPX closed down 5.97%, only to see a 9.52% gain just days later. I doubt many vertical spreads survived all that. Two strikes, you’re out.

My goal is to make money and keep it, even if it’s only a few bucks. It does little good to make a big cash haul in the first hours of market open, only to lose it all – and more – at session close. A trader’s job is to live to trade another day, to keep kicking the ball forward. This is efficient. This is survival. Trade away from risk or die colliding with it.

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Disclaimer: My trades are my own and made solely in my personal trading account. The trades posted in this website are for informational and entertainment purposes only. I am not a licensed securities broker, dealer, financial advisor or analyst. I do not make individual recommendations. Consult your finance professional regarding any trade or investment of your personal resources.

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