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Let's Trade Options

  • #4,441
  • Edited 2:17am Aug 14, 2014 1:31am | Edited 2:17am
OR....(GLD) 9/20 $130.00 calls : 9/26 $129.50 calls ---- 40 delta/43 delta
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #4,442
  • Aug 14, 2014 5:21am Aug 14, 2014 5:21am
Hey TF, interesting stuff... that guy is combining 10 bullish put spreads with 1 OTM bearish put spread and all options have same date expiration. That protection makes sence, because he had $20 wide credit spreads and received a $1.35 credit for it, so in case of sharp selloff, that could be a real pain. But in the same time, they are WAY back, so what whould be the odds? Close them... The worst case scenario is that something drastic happens overnight in AH, than continues to premarket, and when options are finally open to trade in RTH, than is too late. But in this example it would take the RUT to goes from 1146 bellow 1040 overnight. Nevertheless, a good idea.

When I saw yours examples, I first thought of a Broken Wing Butterfliy because I see you are selling the same strikes twice (like 130 in GLD), but then saw diferent dates on your spreads. So you are trying to somehow diagonalize a bear call spread with a bull call spread... Amazing how much one can combine with a few spreads. It would be interesting to see how this is looking on dough, what are the statistical odds.
Hope is dangerous in this game.
  • #4,443
  • Aug 14, 2014 9:02am Aug 14, 2014 9:02am
Managed to salvage less than 1/2 minus commisios of that CSCO trade.
It did not moved after ER's, and flat whole AH, then whole premarket, and then it starts to fall? Hm.... Would do better now.

WMT options... hard IV crush, but I could not make IC with $1 wide strikes. Note for next earnings - look again.

I bought back AAPL 85/105 Sep19 short strangle for $0.84 that I sold for $1.01. Small gain. Will sell again, maybe 87/107 Sep26.
Hope is dangerous in this game.
  • #4,444
  • Aug 14, 2014 10:02am Aug 14, 2014 10:02am
Quoting StrayDog
Managed to salvage less than 1/2 minus commisios of that CSCO trade.
Yup that's why I have given up m/l on the ER stock options strangles. I might get 25% back if it will move lower much by tomorrow....unlikely.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #4,445
  • Aug 14, 2014 10:13am Aug 14, 2014 10:13am
Quoting The Fool
The VIX bull put credit spread from the TT folks mentioned a day or so ago is going to start looking good, as it is now I see perhaps: Sep 20 UVXY sell $22.00 calls/buy $20.00 calls, $0.50 net credit. Not bad for a $2 spread. UVXY has not dipped below $24 for more than a few hours in the last year. This trade might get a little better tomorrow. {image}
Did this trade for a $0.72 credit.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #4,446
  • Aug 14, 2014 10:48am Aug 14, 2014 10:48am
Quoting The Fool
{quote} ... Sep 20 UVXY sell $22.00 calls/buy $20.00 calls .... Did this trade for a $0.72 credit.
You mean Sep20 20/22 bulish put spread ?
Hope is dangerous in this game.
  • #4,447
  • Aug 14, 2014 11:06am Aug 14, 2014 11:06am
Quoting StrayDog
{quote} You mean Sep20 20/22 bulish put spread ?
yes
"If The Fool persists in his Folly he will become wise." - William Blake
  • #4,448
  • Aug 14, 2014 11:51am Aug 14, 2014 11:51am
Sold strangle on AAPL, 89/106 Sep26 for $1.23 credit

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Hope is dangerous in this game.
  • #4,449
  • Aug 14, 2014 2:42pm Aug 14, 2014 2:42pm
Quoting Cecil Gee
just looked at russell and s/p if we get rejections from current levels , russell 1140 and s/p 1945/48 then down I'm thinking she goes, the dow and ndx are not agreeing yet so its making me nervous
taken those levels above and if s/p trades above the 50 dma then we should break the highs and trade above
  • #4,450
  • Aug 14, 2014 3:02pm Aug 14, 2014 3:02pm
Quoting Cecil Gee
{quote} taken those levels above and if s/p trades above the 50 dma then we should break the highs and trade above
sitting on hands here. Margin near my limits until next week anyway. I like the SPY or SSO bear call spreads but I think we may see better entries next week, likewise for VIX derivatives, bull put spreads will look better with VIX bumping back down to 11.xx, bet we'll see that soon.

TLT gained $1 today on another strong 30y bond auction. Hasn't seen $116.50 since over a year ago. Not thinking I want to fade it.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #4,451
  • Aug 14, 2014 3:14pm Aug 14, 2014 3:14pm
Quoting The Fool
{quote} sitting on hands here. Margin near my limits until next week anyway. I like the SPY or SSO bear call spreads but I think we may see better entries next week, likewise for VIX derivatives, bull put spreads will look better with VIX bumping back down to 11.xx, bet we'll see that soon. TLT gained $1 today on another strong 30y bond auction. Hasn't seen $116.50 since over a year ago. Not thinking I want to fade it.
I was tempted to do a OTM butterfly on TWTR but am pissed off with the bad QQQ trade i did earlier in the week, jumped the gun on that one

TWTR would have been 22 August expiry long $46 - short $50 - long $53, would cost around 55c, closing price is 45.33
  • #4,452
  • Edited 7:43pm Aug 14, 2014 7:06pm | Edited 7:43pm
Quoting StrayDog
So you are trying to somehow diagonalize a bear call spread with a bull call spread... Amazing how much one can combine with a few spreads. It would be interesting to see how this is looking on dough, what are the statistical odds.
StrayDog I did try to model the bull put credit spread with a protective bear put debit spread on dough but it didn't give me a composite POP that I was looking for. Quite possible I did something wrong or that it won't do the math....

Looking at the trade setup again, it looks like the idea is to shade a bit toward delta neutrality between the short and long legs of the trade as a whole. The closer you come to that, though, the more you diminish the inital credit.

This idea is another one on my long list of things to figure out and is a good candidate for some backtesting.
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #4,453
  • Aug 15, 2014 7:37am Aug 15, 2014 7:37am
Quoting The Fool
{quote} StrayDog I did try to model the bull put credit spread with a protective bear put debit spread on dough but it didn't give me a composite POP that I was looking for.
I did not get it either. Possibly the demo version does the math only for default spreads and combos from platform.
Hope is dangerous in this game.
  • #4,454
  • Aug 15, 2014 8:42am Aug 15, 2014 8:42am
Sold some PLUG 5.5 Sep19 puts for $0.44 credit. Break even is at $5.06, I dont think it will drop that far after good earnings.

Will go naked short here, or spread with long 5 Sep19 puts.
Hope is dangerous in this game.
  • #4,455
  • Aug 15, 2014 8:55am Aug 15, 2014 8:55am
Quoting StrayDog
Sold some PLUG 5.5 Sep19 puts for $0.44 credit. Break even is at $5.06, I dont think it will drop that far after good earnings. Will go naked short here, or spread with long 5 Sep19 puts.
Good Luck. PLUG FCEL BLDP can be pretty volatile sometimes...

I thought we might see some market selloff for a Friday. Geez, look at TLT, too bad I have generally been on the wrong side of that trade this year
"If The Fool persists in his Folly he will become wise." - William Blake
  • #4,456
  • Aug 15, 2014 9:00am Aug 15, 2014 9:00am
Looks like today is starting with another jump higher. It seems SPX is determined to march towards 2000!!! I've currently got no positions and am sitting on my hands waiting for the next opportunity! I can't see any immediate issues that will stop this 'meltup'.....geopolitical risks are cooling, china seems like it is making a soft landing, fed easing taper tantrums seem to have settled, VIX is looking like it will go sub 12 again!

I might need to become an options buyer rather than a seller!
  • #4,457
  • Aug 15, 2014 9:14am Aug 15, 2014 9:14am
Quoting njr
Looks like today is starting with another jump higher. It seems SPX is determined to march towards 2000!!!
QE forever baby. Buy the dip or pay the limit, either way I'll see you at 2k+ in September.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #4,458
  • Aug 15, 2014 9:56am Aug 15, 2014 9:56am
VIX is surging up.... just a minute ago I was considering that bullish put spread on UVXY... the one that TF did.
Hope is dangerous in this game.
  • #4,459
  • Aug 15, 2014 9:58am Aug 15, 2014 9:58am
Quoting StrayDog
VIX is surging up.... just a minute ago I was considering that bullish put spread on UVXY... the one that TF did.
Hot off the press!

http://www.cnbc.com/id/101906428
  • #4,460
  • Aug 15, 2014 10:30am Aug 15, 2014 10:30am
Quoting njr
{quote} Hot off the press! http://www.cnbc.com/id/101906428
How shit allways happens when market is at resistance... NQ was 3996...

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Hope is dangerous in this game.
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