It is official, I'm over adjusting my trades. I've over-adjusted the DIA and MDY positions Yesterday and Today. Needless to say, this frustrates the heck out of me. I need to go back to the drawing board and do what I've been avoiding: backtest the iron butterflies in order to have some structure for their adjustments.
Must watch Dan Harvey's videos again and do my own backtesting with end of day data from TOS. This is the only way for me to have some sort of structure in order to trade those iron butterflies, otherwise it will be another case of over-adjusting my way out of profits.
For now, my decision is simple: if they get ugly intra-day, have an entry order to cut delta in 1/2, then re-evaluate the position at closing. if they close at max loss, exit. It will either work or won't. I won't flatten the deltas again intra-day, if we hit a max loss point at closing, that's ok, this is my first try on these trades, and some times it beats you. I just won't beat myself again by over-adjusting all the time.
Gustavo
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