Dan takes a critical but balanced look at backtesting and why it often leads traders astray, especially when it comes to strike and expiration selection for covered calls and cash-secured puts. Drawing on decades of experience and firsthand work with traders and developers, Dan explains why backtesting tools have structural limitations, how those limitations create misleading conclusions, and why discretion, objectives and real-world market structure still matter far more than “optimal” backtested metrics.

Disclosure:

Options involve risk and are not suitable for all investors. Prior to buying or selling an option, investors must read Characteristics and Risks of Standardized Options (ODD) which can be found at https://www.theocc.com/company-information/documents-and-archives/options-disclosure-document

Don’t trade with money you are not prepared to lose. Anything discussed on this show is intended to be generalized information and not intended to be a recommendation to buy or sell any security. The host and guests are not familiar with listeners’ specific situations. For trading information relevant to your specific needs, speak with a licensed broker or advisor.  

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