Playbook Lessons — Six Rules Worth Testing for v1.1

The trade-log's job is to test the playbook in production. Since the v1.0 SOP shipped on 2026-07-05, the journal has run eight new trades across four underlying structures and four tickers. Each trade includes a ## Lessons section, and each one with a rule-implication carries a For the playbook: prefix. This article compiles those items, presents the candidate rule changes, and holds them for review before they move into a formal v1.1 SOP.

The v1.0 SOP remains canonical until v1.1 is published. Nothing below is in force yet — these are queued candidates.

Why we wait

A playbook revision is high-friction: it changes rules the size of "0.25% of NLV per trade" and "50%-profit target." Each candidate below gets the framework it needs to be reproducible (the trade-log link, the structure, the edge metric that surfaced it), so the v1.1 SOP can be assembled with a proper changelog, not a guess.

If a queued candidate is contradicted by a later trade, it gets dropped from the v1.1 backlog. If a candidate is reinforced by additional trades, it gets promoted with higher confidence.

Candidate #1 — Deep-OTM directional verticals as a distinct structure category

Source trade: 2026-07-16 SKHY 195/200 bull call spread

Original For the playbook: quote:

The 0.25% NLV per-trade cap is the right sizing for a high-reward / low-probability structure like this. Even at max loss, the position only costs 0.25% of NLV. This allows multiple low-PoP/high-reward positions to coexist in the book without concentrating tail risk. Future iterations of the playbook should formalize deep-OTM directional structures (verticals, long shots) as a distinct strategy category with the same 0.25% sizing but a different thesis template (catalyst-driven directional view, not premium-harvest).

Candidate v1.1 rule: Add a Section 3 row and a Section 7 thesis template for deep-OTM directional verticals. Same 0.25% per-trade cap, same 50%-profit/2×-debit stop, but the thesis template shifts from "premium harvest in a high-IV regime" to "catalyst-driven directional view with low-PoP / high-reward structure." The category needs its own entry checklist (catalyst present? sizing of expected move? IV environment not adversarially low?) rather than inheriting the IV-rank-based structure selection in v1.0 Section 3.

Edge metric that surfaced it: SKHY 64-DTE 195/200 vertical opened at $0.80 debit ($80 risk) with $420 max profit (5.25:1 R/R) and ~31% POP. Two of these coexist in the book at the same time without approaching the daily or weekly loss limit.

Candidate #2 — Long-Dated Directional LEAPS as a sub-category

Source trade: 2026-07-17 USAR 20/25 Jan 21 '28 bull call spread

Original For the playbook: quote:

LEAPS verticals on thematic / pre-revenue small-caps (USAR, SKHY-class names) deserve a distinct sizing + management template. The 553-DTE horizon shifts management windows dramatically vs. a 30–60 DTE vertical — 50%-profit rule, stop loss, and "close before expiry" mechanics all need to scale with DTE.

Candidate v1.1 rule: Add a Long-Dated Directional LEAPS bucket (Section 5 row). Specifically:

• Sizing: 0.25% NLV per trade (same as standard vertical)
• Profit rule: 50% of max profit, but with allow 90 DTE to expiry before forced close (vs. 30 DTE for short-dated verticals)
• Stop loss: 2.5× debit (vs. 2× for short-dated), giving thematic positions more runway
• Dilution check: Quarterly monitoring for equity raises / convertible issuance, since sub-scale thematic issuers often tap the market

Edge metric that surfaced it: USAR 553-DTE 20/25 vertical opened at $0.80 debit, $4.20 max profit, 29.6% cushion to lower breakeven. The 553-DTE horizon means the standard 30-DTE-to-expiry forced-close would fire in 16 years if we applied the v1.0 rule mechanically.

Candidate #3 — Inverse diagonal call spread

Source trade: 2026-07-15 QQQ inverse diagonal call spread

Original For the playbook: quote:

The next iteration should consider the OptionStrat inverse diagonal in addition to the standard diagonal. The standard diagonal profits from bullish rallies with high IV. The inverse diagonal profits from rangebound-to-mild-bullish with normal IV. Both belong in the playbook as bullish expressions with different vol environments.

Candidate v1.1 rule: Add inverse diagonal call spread to Section 3 (structure selection) and Section 4 (strike selection). The IV-rank-and-time-horizon matrix gets a new row for the inverse diagonal in the "normal IV" band (20-50), positioned as the rangebound-to-mild-bullish expression. Strike-distance sigma math is the same as a standard diagonal but with the short strike below the long strike.

Edge metric that surfaced it: QQQ inverse diagonal 740/700 (long 740C / short 700C) captured the "rangebound with no directional conviction" environment the standard diagonal can't handle cleanly.

Candidate #4 — Rolling diagonal adjustment

Source trade: 2026-07-15 DRAM diagonal call spread

Original For the playbook: quote:

The next iteration should explore rolling the short leg if DRAM spikes past $75 in months 1–2 — closing the short 70C for $5+ profit and reopening a new short leg at a higher strike (75C or 80C) to recapture theta. This "rolling diagonal" pattern lets you ride a sustained rally past $70 while continuing to harvest front-month theta. Not relevant for this entry, but worth testing on a future setup.

Candidate v1.1 rule: Add a Section 6 (adjustment rules) clause for diagonal roll-up. The pattern is: if the underlying breaks above the short strike by close, close the short leg for ≥$5 profit (per-contract) and reopen a new short leg at the next σ-distance strike. Net result: theta continues to be harvested at the new short strike, the long leg rides the rally uncapped.

Edge metric that surfaced it: The DRAM 70/50 diagonal opened on a -6.6% pullback; the trade-log entry explicitly forecasts that "if DRAM spikes past $75 in months 1-2, rolling the short leg is the playbook-approved move." The SOP currently has no rolling-diagonal rule.

Candidate #5 — 5%-pullback scale-in on a working condor

Source trade: 2026-07-13 DRAM long call condor

Original For the playbook: quote:

The next iteration should address position sizing: 1 condor = 0.25% NLV, which is correct for a first entry; a second add on a 5% pullback would be the next playbook-approved scale.

Candidate v1.1 rule: Add a Section 5 sizing clause for memory-theme LEAPS condors: a second add at 0.25% NLV is permitted on a 5%-or-greater pullback of the underlying, capped at one scale-in per underlying. Total exposure (first + scale-in) cannot exceed 0.50% NLV. The scale-in is a separate entry, not a roll, and inherits the management rules of the original position.

Edge metric that surfaced it: DRAM condor #1 opened at the v1.0 SOP sizing (0.25% NLV); the trade-log notes that "a second add on a 5% pullback would be the next playbook-approved scale." v1.0 has no provision for scale-ins.

Candidate #6 — Long-Dated (249–262 DTE) diagonal as a structure variant

Source trade: 2026-07-24 RUT diagonal call spread [archival Apr trade; surfaced from the trade-log Apr-24]

Original For the playbook: quote:

The 249-262 DTE diagonal structure is a useful addition to the standard playbook. It expresses a directional bullish view with defined risk and has the hump profit potential at intermediate horizons — something a same-expiration bull call spread can't offer. The key tradeoff is the higher debit ($2,870 vs ~$1,500 for a same-expiration 2900/2950 spread) in exchange for the additional upside at intermediate times.

Candidate v1.1 rule: Add a Section 4 row for 249-262 DTE diagonals. Sigma-distance of the short strike gets the same 0.4-0.6σ as the 45-DTE diagonal, with a DTE at entry of 200-280 (not 35-50 as the standard diagonal). The volatility profile of these is "longer-duration calendar with directional leverage."

Edge metric that surfaced it: RUT diagonal at $2,870 debit / $6,250 max profit over 249 DTE is a different opportunity-cost profile than the 45-DTE diagonal in v1.0 Section 4. The trades are rarely interchangeable.

What v1.1 should look like (preview)

The actual v1.1 SOP would inherit v1.0 structure and add:

• Section 3: +1 row for deep-OTM directional verticals, +1 row for inverse diagonals
• Section 4: +1 row for 249-262 DTE diagonals
• Section 5: +1 row for long-dated directional LEAPS bucket, +1 sizing clause for memory-theme scale-ins
• Section 6: +1 rolling-diagonal adjustment clause
• Section 7: +2 thesis templates (deep-OTM directional, long-dated LEAPS)

If all six candidates are adopted, the v1.1 SOP grows by roughly 30% vs. v1.0. Cross-references to the source trades live in each section so the rationale is auditable.

What stays the same

The hard rules (Section 8 in v1.0) do not change:

• No averaging down
• No revenge trading
• No oversized positions
• No discretionary overrides of the playbook
• No trading under the influence
• No trading on event days unless the setup is event-specific

These are non-negotiable. The candidate rules above are about which structures go in the book, not about exception-handling.

Status of v1.1

These six items are queued. None is in force. Trades during the queued period are still evaluated against v1.0, with the trade-log Lessons sections accumulating additional evidence for or against each candidate.

When v1.1 ships, this article stays as a permanent changelog entry alongside it. The trade-log entries that surfaced each candidate remain the primary source — this article is the index to them.

See also: The Playbook v1.0 SOP, which remains the canonical reference until v1.1 ships.