Why do the results of my bread-and-butter strategy 0DTE Breakeven Iron Condor vary so significantly throughout the year? How can it be that trades entered during the opening hours of the market at the beginning of the year were profitable, and the same trades during the last months of the year were barely making money? A trade log can help you understand.

0DTE options trading

0DTE options trading has exploded in popularity over the last couple of years. In fact, 0DTE options – options contracts expiring the same day (zero days to expiration) – now constitute a significant portion of all options trading.

And there are hundreds of different strategies. You can buy calls or puts to bet on the direction, you can sell iron condors to bet on moves within a certain range, or buy iron condors to bet on a big move in either direction, or do broken butterflies, iron butterflies, or any other kind of strategy. Some strategies carry explosive risk – and the corresponding chance of huge profit or huge loss, other strategies depend on small daily gains – and the corresponding small drawdowns.

Keeping a trade log

I have tried a few of the strategies. And I have had solid wins and huge losses. Finally, I have ended up with the 0DTE Breakeven Iron Condor as my bread-and-butter strategy. It has served me well for more than three years with only three losing months so far.

However, this article is not about the 0DTE Breakeven Iron Condor strategy. Instead, it is about the importance of having a trade log to help analyzing your trades.

Trade log in Excel

I started logging my trades back in 2018 in an Excel sheet. For every trade, I log several details, such as the opening date, closing date, which strategy, collected premium/paid debit, adjustments, total risk (buying power), gross profit, net profit, and more.

For 0DTE trades, I also log which hour during the day the trade was opened.

I then use pivot tables to analyze the results of the different strategies.

The Excel sheet now contains almost ten thousand trades. This makes it possible for me to analyze the results of my different strategies. I also have built a custom GPT based on ChatGPT that I use for quicker analyses.

Today I cannot imagine doing 0DTE options trading without a good trade log.

Why do I log my trades

Why is that?

Because that is the only way I can systematically analyze the results of my trading.

Yes, I know that I can follow how my trading account develops. Does it go up or down? That part is easy. But for it to be useful information I also need to know why it goes up and down. With 0DTE most of us put on several trades every day. This can easily be more than 1000 trades in a year.

We tend to think we remember what went well and what did not. However, most of us will be surprised when we start analyzing the actual details of our trading.

A good trade log also helps in comparing the profitability of different strategies. You can analyze this in Excel, or by building a custom GPT for your log.

My 0DTE Breakeven Iron Condor example

And here is my analysis surprise:

My trade log gives two conclusions about my profit and loss depending on which hours the trades were opened:

– There is a significant difference in results depending on which hour the trade was entered during the day

– However, these differences are not stable over time. The results can be very different from one quarter to another.

For instance: Compare the two following graphs from my trade log. They give the results for the same strategy two quarters in a row. The results vary significantly.

What to learn from this?

Now, with so differing results for each quarter, is there any learning at all from this?

I think there is.

Here are my conclusions:

– Fight the recency bias! We all tend to put more weight into our recent results. However, these examples show that the recent experience may not be accurate for the long term.

– Keep logging! The longer you have data, the more trustable they are. My graphs are only for one year. But what if I log for 3-4 years more? My data will be more and more trustworthy.

– Remember that markets will change. The characteristics of the market are never stable. History does not tell all about what you can expect today.

How I will use these data

So how will I use these data? Will I change my trading style? Stop trading before lunch? Only trade during the last two hours? Because that would be the rational thing to do, right?

Here is my thinking:

– I will keep trading my 0DTE Breakeven Iron Condors throughout the day. This is important to keep collecting useful data on how the strategy performs over time.

– I will trade smaller and less frequently on less profitable hours and bigger and more often on profitable hours. That means that more of my trades, with the current results, will be at the end of the day.

– I will adjust quickly when I see the market change. For the time being my trades in the morning are not very profitable. But the very moment I see that change, I will put more risk into the morning hours.

– I will keep learning. This is not a one-size-fits-all exercise. And not a one-size-fits-at-all-times.

Back to the importance of keeping a trade log

But this all brings me back to my main point: We need to log our trades!

And we need to analyze them.

I do not care how you log your trades. I use an Excel sheet. You may use external services, such as Wingman. Or a more simplified sheet. Many retail traders have also created trade log templates you can download.

The most important is that we systematically log our trades and have a way to analyze them.

And, as a minimum, we need to log them by strategy, results, total risk, and, of course, time stamps.

The fallacy of memory

Because this is what we will discover: We cannot trust our own memory!

We need to gather our data over a long period of time. And we need to analyze them systematically. And learn from the results. Ideally also compare our own log with the results from backtesting, for instance through Option Omega.