During the first 30 days, the extra wide PDS will provide added protection against a pullback early in the trade (when it’s needed most). It will become more of a hedge later on, or can be adjusted for income.

Trade Entry

• Enter at 150 DTE
• Buy a 200 wide Put Debit Spread (PDS) starting at around 25 Delta on the Long Put
  • Increase the width of the PDS for a larger trap
• Sell NPs at 5 Delta
• Aim for a total credit around $10-11cr
  • Take in less credit if you want more of a hedge
• Size according to a Maximum Allowable Loss (MAL) of 2% of Net Liq

Trade Management

Options at 120 DTE:

1. Roll up the Short Puts of the PDS 150 points to the standard 50 wide PDS
   • Try to take in around $12 in credit for rolling
2. Leave the 200 wide PDS intact to use as a hedge
3. Roll up the NPs to around 5-6 Delta for around $2-3 credit

• Manage the trade as a regular 120 DTE LT112 from here on out