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Market Measures - January 26, 2026 - 0 DTE Breakdown: 6 Lessons from 2025


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Hosts Nick and Tony explored Kai's six critical lessons from 2025 zero-DTE trading, starting with the revelation that equity zero-days launch next week (Monday/Wednesday/Friday) for Mag 7 stocks. The Thursday reversal challenged conventional wisdom as the day historically considered "worst for iron condors" turned profitable, though Friday remained near-zero consistently. The Q1 win streak analysis identified optimal conditions: moderate realized volatility, elevated but stable IV (18-22 range with no spikes), and slow grinding upside - creating perfect environment where vol stayed high while realized came in lower during "upside chop." The back-to-back loss study revealed average 12-trade recovery period after losses (roughly 3 weeks), though April 24th's largest loss required only 9 trades due to elevated IV and credit levels. Credit level comparison across quartiles (0-25%, 25-50%, 50-75%, 75-100%) showed remarkably consistent 88-91% win rates, though extreme-high-vol quartile (75-100%) experienced 6-7% lower win rates and increased P&L volatility - supporting thesis that "100% IV is too high for short premium" versus optimal 40-70 IVR range.
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