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Let's Trade Options

  • #11,481
  • Dec 12, 2015 8:39pm Dec 12, 2015 8:39pm
Quoting The Fool
{quote} well, the main message is: if you want to trade VIX options, check into the margin requirements before you dedicate real money - it's a differently-striped cat.....the bflys, however, seem to trade the same as any equity option bfly.......so that might be my go-to play for VIX. I have the one below..... ......another thing or 2 - the VIX options expire on Wednesdays, which is to sat Tuesday is your last day to tweak them.....and, the weeklies are still thin, so look in the monthlies for good volume....in the Jan chains, Jan4 is the monthly...
I usually run through all the usual suspects, but I neglected the fly and/or a "broken fly."
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,482
  • Dec 12, 2015 8:47pm Dec 12, 2015 8:47pm
....just keep an eye on the junk
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,483
  • Dec 12, 2015 8:52pm Dec 12, 2015 8:52pm
Quoting ZebraSquirl
{quote} I'm kind of looking at this whole thing as a once in a lifetime thing ... . When are we going to see another post-QE, TARP, ZIRP first-time rate hike? Hopefully never, but it might be kinda "special" ...... .
indeed....I have not been trading options all that long, just finishing 2 year really, but by now I think I understand that high volatility is where it's at.....been a long time coming, maybe we can get a year's worth?
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,484
  • Dec 12, 2015 9:15pm Dec 12, 2015 9:15pm
it's rare (i.e., VIX above 30)....but it happens....
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,485
  • Dec 12, 2015 9:29pm Dec 12, 2015 9:29pm
a few more ideas
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,486
  • Dec 12, 2015 9:47pm Dec 12, 2015 9:47pm
prolly more likely, the inevitable reversion.....good luck getting filled cheap on thin SVXY, UVXY verts....
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,487
  • Dec 12, 2015 10:02pm Dec 12, 2015 10:02pm
Quoting The Fool
prolly more likely, the inevitable reversion.....good luck getting filled cheap on thin SVXY, UVXY verts....
no middle ground
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,488
  • Dec 12, 2015 10:14pm Dec 12, 2015 10:14pm
6-month calendar opens up into 6 months of $8 long calls after Jul expiry.......still more downside for PBR tho, probably
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,489
  • Edited 10:44pm Dec 12, 2015 10:20pm | Edited 10:44pm
speaking of 6-mo calendars.......the high yield funk rumor might just blow away........you can do a 1-yr $90 calls calendar (Jan'17/Jan'18) for 13c.........maybe wonder if HYG will rebound that high if Fed goes steady with the 1%/yr ffr hikes........anyway, HYG one of the best coalmine canaries around.
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,490
  • Dec 13, 2015 1:13am Dec 13, 2015 1:13am
just a little more long vol, I can quit anytime I want, I swear....
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,491
  • Dec 14, 2015 1:25am Dec 14, 2015 1:25am
Quoting The Fool
{quote} indeed....I have not been trading options all that long, just finishing 2 year really, but by now I think I understand that high volatility is where it's at.....been a long time coming, maybe we can get a year's worth?
Trying to trade the broader market indices in that crap we had between mid-March and August end was quite the undertaking, so it's about darn time, dangit ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,492
  • Dec 14, 2015 1:31am Dec 14, 2015 1:31am
Quoting ZebraSquirl
so it's about darn time, dangit ... .
definitely......but /ES I see up 14 .....oh gawd no not another V-bottom.....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,493
  • Dec 14, 2015 1:35am Dec 14, 2015 1:35am
Quoting The Fool
it's rare (i.e., VIX above 30)....but it happens.... {image}
Fingers crossed for the rarity ... .

I haven't done the math on what kind of VXX spike would be required for me to get a fill for .10 on the lowest man on my VXX long put vert totem pole, a Jan 15 20/22, but I imagine it's going to have to be quite dramatic; it's currently going for .95 or so ... . May have to get a "little" bit less chintzy on the fill price ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,494
  • Dec 14, 2015 1:48am Dec 14, 2015 1:48am
Quoting The Fool
{quote} definitely......but /ES I see up 14 .....oh gawd no not another V-bottom.....
Shee yat ... . Also see XAUUSD givin' some up; need GLD to hold 101 into Friday expiration, por favor ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #11,495
  • Edited 2:34am Dec 14, 2015 2:22am | Edited 2:34am
I've got a GLD Dec/Dec4 DD, not looking like it will do much for me, but I only put out $0.01 per side......gold has been a snooze since the spring of 2014...
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,496
  • Dec 14, 2015 4:37am Dec 14, 2015 4:37am
Ok guys thanks for your input.. I will go through all what you wrote Anyway so options is more for longer term trading, as I can see. 2-3 weeks to couple of months lasting trade right?

Now I have a couple of stupid questions as it may seem but I have to ask them

Straddling the lets say Oil at the start of the month by buying one ATM put and call option, how profitable or not can it be?

Also using protective call/put strategies in the same manner how useful are they? Now the time period could be even 2,3 months, or even the whole year for yearly ATM options. What are the margin requirements in those cases, and how much the price has to move for them to be profitable?
  • #11,497
  • Dec 14, 2015 9:12am Dec 14, 2015 9:12am
Quoting merquise
Ok guys thanks for your input..
Hi marquise,

Most of your questions you will be able to answer for yourself if you will just start paper trading. You should open an account and go for it. Do you know StrayDog? He is there in Belgrade with you - don't know if he is trading options so much anymore, maybe he would help you some? I can't speak for him but it won't hurt to pm him & ask....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,498
  • Dec 14, 2015 9:22am Dec 14, 2015 9:22am
orders I have on to catch a ^VIX collapse, as seen I am not looking to risk too much....fishing for the crash b4 the spike.....crazy?
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"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,499
  • Dec 14, 2015 9:27am Dec 14, 2015 9:27am
omg natgas
"If The Fool persists in his Folly he will become wise." - William Blake
  • #11,500
  • Dec 14, 2015 11:00am Dec 14, 2015 11:00am
Quoting The Fool
{quote} Hi marquise, Most of your questions you will be able to answer for yourself if you will just start paper trading. You should open an account and go for it. Do you know StrayDog? He is there in Belgrade with you - don't know if he is trading options so much anymore, maybe he would help you some? I can't speak for him but it won't hurt to pm him & ask....
Ok, no prob. No I don't know the guy, will send him a pm though once I finish upon reading the material..thanks anyway
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