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  • #11,281
  • Nov 24, 2015 5:01pm Nov 24, 2015 5:01pm
Quoting The Fool
{quote} 3c was a .....a .....deal....? http://www.cnbc.com/2015/11/24/the-4...&doc=103191525
I thought about a similar play post NBG "earnings". I think it's probably a good thing that Greece no longer has a majority stake in NBG and that its stake in a number of other banks has been pared back significantly. But, hey, it's a lottery trade ... . That whole foreign investment firm stake thing might help them clean house ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,282
  • Nov 24, 2015 5:08pm Nov 24, 2015 5:08pm
Got a touch greedy on the DE earnings play. Volatility popped after open and the setup I had anticipated was at one point going for 1.50 credit plus/contract. But noooo, I waited until toward the end of the session, by which time vol had ebbed -- filled for a 1.03 credit.

Tomorrow's play: FIT

Jan 15 21/33 short strangle for a 1.48 credit
POP%: 72%
Max Profit: $148/contract
Buying Power Effect: ~$268/contract
BE's: 19.52/34.48

Good premium for an under-$50 underlying; that being said, I doubt that I'll get filled at the mid (not the most liquid options in the world), and I probably won't chase price far ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,283
  • Nov 24, 2015 7:27pm Nov 24, 2015 7:27pm
Quoting ZebraSquirl
I thought about a similar play post NBG "earnings". I think it's probably a good thing that Greece no longer has a majority stake in NBG and that its stake in a number of other banks has been pared back significantly. But, hey, it's a lottery trade ... . That whole foreign investment firm stake thing might help them clean house ... .
Yup, I am the proud master of 5,000 shares of NBG from Jan'16 to Jan'17 - assuming the 50c calendars don't pay out with a perfect finish - worst that can happen is the junk spikes above $1 by Jan '16 expiry, even so, ......3c, whew....I'm a baller
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,284
  • Nov 24, 2015 8:15pm Nov 24, 2015 8:15pm
Quoting The Fool
SUNE, lotto ticket trade idea of the day, crazyass superbull, sell the Apr $2.5/$1.5 vert puts for 50c and buy the Apr/Jan'17 $10 calls calendar for 32c....Apr a long time to tie up $1.00 margin, but 50c back on it is fine....SUNE maybe heading for BK, but that is gonna take some time & there will likely be some bottompicker action on it IF (big IF) the wider market rallies into Q1 2016 and oil rallies too.....if you don't get much out of the $10 calendar, let the Jan'17 calls run and hope for a miracle rebound....I could see SUNE working out some...
....sorry I missed the bottom on SUNE, saw it, just wasn't hungry....still time though...you could still sell the same Apr calls vert for 43c, the same calendar debits ~$0.70..........todays options: 138k calls to 34k puts
Attached Image (click to enlarge)
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,285
  • Nov 25, 2015 11:22am Nov 25, 2015 11:22am
Hey TF & ZS...

I had plenty of various shit to do, so my trading was very very thin.

I have a question about FX hedzing. I know a man who has a developed bussiness, and he is importing various raw materials needed for production. He is paying that in USD, so for example, he signs contract with Chinese manufacturer today, and pays agreed sum in USD after 90 days. He has euros... so how to hedze that USD transaction? Should he "lock" the curent eur/usd price with simple buying the same amount of euros on spot FX? Should he buy ER futures? Or hedze somehow with options? I am too tired and my mind is elsewhere currently.

I would know if the question was about stock portfolio... like for buy & holders to do covered calls... For ER's protection to the downside, you can do Cashless Colar, and so on... Sell puts as bullish strategy, blah, blah... But I got really confused by this question.
Hope is dangerous in this game.
  • #11,286
  • Nov 25, 2015 12:19pm Nov 25, 2015 12:19pm
not sure about this SDog, will have to get back to you when I have more time....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,287
  • Nov 25, 2015 4:46pm Nov 25, 2015 4:46pm
Quoting ZebraSquirl
Got a touch greedy on the DE earnings play. Volatility popped after open and the setup I had anticipated was at one point going for 1.50 credit plus/contract. But noooo, I waited until toward the end of the session, by which time vol had ebbed -- filled for a 1.03 credit. Tomorrow's play: FIT Jan 15 21/33 short strangle for a 1.48 credit POP%: 72% Max Profit: $148/contract Buying Power Effect: ~$268/contract BE's: 19.52/34.48 Good premium for an under-$50 underlying; that being said, I doubt that I'll get filled at the mid (not the most liquid options...
Filled that FIT short strangle for 1.38.
DE earnings was inzee-outzee for 50% max.
HES (my last oil volatility play; had ones on in OIH and XOP) out at 50% max.
Bailed on several index ETF short call verts (hey, the premium's richer down there) at 50% max. I don't like the smell of this low volume run-up, and if one downed Russian jet can drop /ES/SPY to 202 between London and NY open, I don't want to be caught in the middle of that (or worse). Best to wait for volatility/weakness to reload on those ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,288
  • Nov 25, 2015 6:02pm Nov 25, 2015 6:02pm
Quoting StrayDog
Hey TF & ZS... I had plenty of various shit to do, so my trading was very very thin. I have a question about FX hedzing. I know a man who has a developed bussiness, and he is importing various raw materials needed for production. He is paying that in USD, so for example, he signs contract with Chinese manufacturer today, and pays agreed sum in USD after 90 days. He has euros... so how to hedze that USD transaction? Should he "lock" the curent eur/usd price with simple buying the same amount of euros on spot FX? Should he buy ER futures? Or hedze...
I used to have to do these once in a while, but it's been quite a long time (hey, when you're exporting 10 combines at $250k a pop, little swings in the exchange rate will f you hard if you are on the wrong side of the swing). Here's a good article on the subject: http://www.wikihow.com/Hedge-Currency (ignore the crap about the swaps; he's probably just doing a straight cash transaction that doesn't involve payments in installments and interest and the like).

In his particular case, he wants to hedge against a downturn in the EURUSD exchange rate, since that will mean that he has to fork over more Euros to complete the transaction since they will be worth less. An upturn would actually benefit him (as he would have to pay fewer Euros to complete the transaction), so he doesn't need to hedge against that.

Me personally, I think taking a spot position is expensive "insurance," so I would go the futures options route. You can naturally do a short call -- if price moves down and is below the short call at expiry, he keeps the credit received, hedging some of the down move. The alternative would be a long put -- if price moves down, the price of the long put increases in value, again hedging some of the down move.

Part of the equation as to which option to choose and at what strike is generally how much the person wants to pay for the "insurance" and how completely they want to hedge. As with any options setup, you'll just have to work through possible setups, see what the cost of each is, as well as how much in dollars and cents will be potentially hedged.
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,289
  • Nov 25, 2015 8:31pm Nov 25, 2015 8:31pm
Thanks, ZS....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,290
  • Edited Nov 26, 2015 11:14am Nov 25, 2015 11:56pm | Edited Nov 26, 2015 11:14am
https://www.nbg.gr/english/the-group...20RS%20eng.pdf

....so, National Bank of Greece on 11/27 is doing a 15:1 RS on their 3+billion shares and establishing the share price after the RS at 0.30 euro...(a huge reduction in share value)...this does not affect NBG ADR's, so the x,000 shares I have in NBG will still be x,000 shares and the value will be......? (well, approximately 0.30 euro/share, no?)....trading suspended 11/30-12/2, then we'll see what's what.......3+billion shares down to 235.5MM shares, should be a good thing in the long run, right....?

edit: no, your ADR's will have to be reduced 15:1, same for options on those......
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,291
  • Nov 26, 2015 11:13am Nov 26, 2015 11:13am
Quoting ZebraSquirl
.... In his particular case, he wants to hedge against a downturn in the EURUSD exchange rate, since that will mean that he has to fork over more Euros to complete the transaction since they will be worth less. An upturn would actually benefit him (as he would have to pay fewer Euros to complete the transaction), so he doesn't need to hedge against that.
Yes, you are absolutely right about that, I made a mistake in my post.

Quoting ZebraSquirl
Me personally, I think taking a spot position is expensive "insurance," so I would go the futures options route. You can naturally do a short call -- if price moves down and is below the short call at expiry, he keeps the credit received, hedging some of the down move. The alternative would be a long put -- if price moves down, the price of the long put increases in value, again hedging some of the down move. Part of the equation as to which option to choose and at what strike is generally how much the person wants to pay for the "insurance" and...
To tell you the truth, buying the futures puts is also expensive... For example one contract EUR March 2016 - strike 1.06, is currently about 3,650 usd... So, for hedging a USD 2M, how many of these do you need? Multiplier on Globex EUR futures and their options is 125,000. So you would need 15 contracts then (125,000 x 1.06 = 132,500 and 15 x 132,500 is about 2M). So, 15 x 3,650... the sum is almost a 3% of that USD 2M. Is that simple math good or not, idk?

OR... you can enter a short 2M eur/usd position on spot FX, and margin required on IB PM account is about usd 63,000. I don't know how much would you pay for interest, because it is not so visible here like on MT4, where you can immediately see that daily swap. If the mofo goes up... well, good for your EUR in the bank, not so much for your "protection", but you gotta pay something. If it stays flat - OK, down move - you make some on it... Either way, you pay some interest.

---------------------------
I know that banks do that for clients, "locking" the exchange rates with forward contracts or something , but that is pretty expensive and only a few banks does that anyway. I will ask in those banks what the hell THEY do.
Hope is dangerous in this game.
  • #11,292
  • Edited 3:36am Nov 27, 2015 3:11am | Edited 3:36am
looking at short SPY vert calls - Jan $214/$217 - for $0.85 or better......
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,293
  • Nov 27, 2015 3:17am Nov 27, 2015 3:17am
the real economy says what?
Attached Image (click to enlarge)
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,294
  • Nov 27, 2015 10:56am Nov 27, 2015 10:56am
Quoting The Fool
looking at short SPY vert calls - Jan $214/$217 - for $0.85 or better......
I was looking at pretty much the same... /ES Jan 2140/2170... about $8.00 CR now, with /ES around 2089.


Vol play?
Next week is packed with news... China, Yellen, ECB, NFP, OPEC...

Could the old long vol trade work now? So much coins trown at that direction...
With weeklies... next week expiry?
Hope is dangerous in this game.
  • #11,295
  • Edited 1:38pm Nov 27, 2015 1:18pm | Edited 1:38pm
Quoting StrayDog
I was looking at pretty much the same... /ES Jan 2140/2170... about $8.00 CR now, with /ES around 2089. Vol play? Next week is packed with news... China, Yellen, ECB, NFP, OPEC... Could the old long vol trade work now? So much coins trown at that direction... With weeklies... next week expiry?
There are times when a few long vol lotto tickets are worth the small debits - like now. Lots of possibilities....but, I am set up for catching a spike starting Dec FOMC week, no sooner. In about as deep as I will go already - if nothing pans out, I will not be killt. Looking to sell some premium here and there now...
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,296
  • Nov 27, 2015 3:30pm Nov 27, 2015 3:30pm
Quoting The Fool
Looking to sell some premium here and there now...
...decided to wait on SPY call credit spreads, will see if the Santa rally picks up some steam next week.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,297
  • Nov 28, 2015 6:46pm Nov 28, 2015 6:46pm
Quoting StrayDog
{quote} Yes, you are absolutely right about that, I made a mistake in my post. {quote} To tell you the truth, buying the futures puts is also expensive... For example one contract EUR March 2016 - strike 1.06, is currently about 3,650 usd... So, for hedging a USD 2M, how many of these do you need? Multiplier on Globex EUR futures and their options is 125,000. So you would need 15 contracts then (125,000 x 1.06 = 132,500 and 15 x 132,500 is about 2M). So, 15 x 3,650... the sum is almost a 3% of that USD 2M. Is that simple math good or not, idk? OR......
A complicated affair ... . Most of the time, it's just too expensive to hedge completely such that you won't take a hit on at least some adverse movement.

With the forex, you'll need to look at the swap rate for a short position (adding to the complexity of the thing); the swap rate will tell you what you will pay or be paid for merely holding the position. Last time I checked, you get paid some small amount for holding a EURUSD short (which is long dollar), but were you to hold $2M worth of EURUSD short (about 20 standard lots), that could be significant. When I had an account with FXCM, the swap rate was displayed on its TradingStation platform; don't think it was on MT4, though ... .

Yeah, there is the whole "forward contract" thing; as usual, you pay for that "insurance," too ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,298
  • Nov 28, 2015 6:59pm Nov 28, 2015 6:59pm
Right now, I don't see much on next week's calendar for earnings that I'm interested in:

AVGO -- Wednesday after market close. IVR/IV 52/61. The standard short strangle setup will net 2.00+ (if these off hours numbers are at all correct).
MDT -- Thursday before open. The IVR/IV blows right now. If it stays here, it won't be worthwhile, but it may pop a bit post-earnings, so it could be one of those post-earnings afterglow plays.
AMBA -- Thursday after market close. The IVR is below 50, but the IV is a whopping 92. Just fiddling with a few setups, it looks like the standard short strangle will come in for 1.50 credit +.
ULTA -- Thursday after market close. IVR/IV 71/48. 2.75 for a Dec 150/190 short strangle; the drawback -- no weeklies ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,299
  • Nov 28, 2015 8:02pm Nov 28, 2015 8:02pm
A couple of non-earnings plays with decent premium, particularly given the price of the underlyings:

MXIM: Jan 15 34/44 short strangle
POP%: ~70%
Max Profit: $100/contract
BPE: ~$610
BE's: 33.00/45.00

(And no, it's not the men's magazine; it's an integrated circuit company .... ).

RRC: Jan 15 22.5/35 short strangle
POP%: ~70%
Max Profit: $133/contract
BPE: ~$283
BE's: 21.17/36.33

(Oil and gas play; was going to put on another short strangle in XOP, but this beats that if I can get a fill at that mid ... ).

Looking to bridge the gap between the end of this earnings season and the next with a couple more longer-term plays.
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,300
  • Nov 28, 2015 8:05pm Nov 28, 2015 8:05pm
Quoting ZebraSquirl
{quote} A complicated affair ... . Most of the time, it's just too expensive to hedge completely such that you won't take a hit on at least some adverse movement. With the forex, you'll need to look at the swap rate for a short position (adding to the complexity of the thing); the swap rate will tell you what you will pay or be paid for merely holding the position. Last time I checked, you get paid some small amount for holding a EURUSD short (which is long dollar), but were you to hold $2M worth of EURUSD short (about 20 standard lots), that could...
Makes me wonder how these farmers do it ... . Naturally they have crop protection insurance, but many also buy corn/soybean options to hedge ... .
Fireworks are fun ... as long as you don't blow your fingers off.
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