Methodology

SPX Cash Options

FireForge is tailored for SPX cash options, chosen for their unique benefits:

• High Liquidity: SPX options provide a highly liquid market, which ensures efficient execution and pricing.

• No Assignment Risk: SPX cash-settled options eliminate the risk of assignment, simplifying trade management.

• Broad Market Exposure: SPX options are index-based, diversifying risk beyond single stocks and offering a more predictable return profile aligned with broader market behavior.

FireForge supports defined-risk strategies, including put spreads, call spreads, and symmetric condors.

Each strategy configuration is analyzed with delta increments of 5 (from 1 to 50), allowing for a range of precise risk-reward configurations.

Short-Term Expirations

FireForge focuses on shorter expirations (e.g., 0 DTE) to increase trade frequency. This high frequency enables faster convergence of results to theoretical values, minimizing fluctuations and improving statistical reliability.

This means you will see results that align with your expectations - converging to the theretical values - much faster versus trading 90 DTE for example.

Default fees

Per default, entry fees of $1.77 per leg and and $2.50 slippage per leg were used.

Precomputed Results

FireForge precomputes results for numerous parameter combinations, minimizing wait times when users explore strategies. This precomputed data enables efficient testing and analysis, helping users find the best strategies without delays.