Credit Spreads Squirrel Strategy — 90% Win Rate

The “Squirrel Strategy” is a put credit spread strategy when the market is range bound. This strategy generated a 1,036% return with a 90% win rate since 2003.That’s an average yearly return of 83.38% by following this step by step strategy. So, if you want to make 50% a year even if you work full-time or don’t know anything about put credit spreads, keep reading 🙂

Let me set the scene and define some terms before getting into the strategy…

Put credit spreads are a strategy that makes money when the stock goes up, stays the same or goes down slightly. This is a very reliable and predictable strategy when you trade it correctly. It is typically used by traders to grow their account and generate a consistently side income.

A range bound market is when the market is going sideways. This means the stock jumps up, shoots down, or hardly moves. It’s a market where anything can happen and clear direction exists. This is one of the hardest times to make money for normal traders because it is very difficult to predict what the stock will do next. This is why it’s called the “Squirrel Strategy” because squirrels never know which way they are going when they cross the street.

Referencing the image above, you can see a few important things on this stock chart. When the stock is inside the trading band, the stock is range bound. When the stock is range bound, we follow the rules for the “Squirrel Strategy” which is listed below.

The Squirrel Strategy — Instructions To Have A 90% Win Rate

• Wait for the stock to be inside the Trending Band ( +1 and -1 standard deviation of the 200 day moving average )
• Determine your short strike price for the put credit spread ( stock close price x 96% )
• Determine your expiration date ( current date + 14 days then round up to the next Friday )
• Setup the trade in your broker (sell to open the short strike price, buy to open the strike price below the short price, and use the expiration determine above)
• Ensure you are collecting at least .15 in credit for placing the put spread
• If you can collect .15, officially place the trade

Special entry criteria to increase your win rate: wait until the market has been inside the trending band for at least one day before entering the position and the daily change is less than .95%.

The key lesson here: trade credit spreads in the direction of the trend!

** If you want to get alerts sent straight to your phone when this setup happens or want access to my personal trade alerts that have over a 90% win rate, then check out the 10% Credit Spread Inner Circle Program **

Put Credit Spreads, on average depending on the delta you use, have a 70–80% win rate! However, you can increase that win rate to 90% when you trade the Squirrel Credit Spread Strategy! If you want to learn more or have any questions, reach out via email at hello@theimpeccableinvestor.com.

Thanks for reading 🙂
Austin Bouley
CEO & Chief Strategy Officer