Let's Trade Options

well, you whoopin' me so far.....we'll see

I sold SPY put spreads on this post FOMC slide, details later....

I've already bought a few tickets on that bus with some long-dated stuff that I put on before all this fun happened; I'll roll those up for additional credit if we go all bull in here somewhere.

One of these is a SPY April 15th 133/136 short put vert (reedick, I know). The short put is currently valued at a whopping .37. I'm basically waiting until the shortie of that spread approaches near worthless, after which I'll roll it up within the same expiry to more sensible strikes for at least a .50 credit.

well, "better safe than sorry" always a valid option. I, otoh, am in Mar $182/179 puts and also Mar $185/182 puts (yikes)....72c and 82c respectively........we'll see....

....on one of those above I sold Mar $198/201 calls for 60c.....one or the other of em will make some money.

The other option I was thinking of on this weakness would be another poor man's covered call (I've been working that IWM PMCC like a madman, sucking in credit with every .50 credit + move -- down, sideways with decay, up), but it's awfully buying power greedy ... .

Here's a QQQ PMCC:



As you can see: a $2400 debit, basically. You proceed to work it like a covered call, rolling the short call down toward current price within the same expiry upon significant reduction in value for additional credit, down and out for additional credit, up and out for additional credit, or out at the same strike for a credit -- whatever gets you credit, you do. Take the whole setup off when you're in profit at at least 50% of the credit you received at the git-go for the short call or continue to work the short call side until time starts to run out on the long call (when extrinsic value starts to come into play). You can naturally just close out the short call right before the end (assuming it's not ITM) and keep the long call to finish the ride if it's headed in the right direction ... .

With the IWMM PMCC I set up at the end of December, I've already sucked in about $800 in credit. Naturally, the long call has also decreased in value while I was doing that, so I now need IWM to either just move sideways or up from here. Were I to have had 20-20 hindsight, I would've kept the IWM Poor Man's Covered Put on, but took that off when I hit 50% max profit of the credit received (1.50) on this down turn ... . The back month on that puppy is August, so I got plenty of time to continue to work the pants off of it ... .

Edit: Jury's still out for me on whether these are "worth it." You're tying up a bunch of buying power that you could be doings earnings plays or just playing "bread and butter" 45 DTE setups and such. I put this bugger on at the end of December, and it's only the end of January, so I guess I should be a little more patient, especially since the back month is, like, 7 months away ... . That's quite a few expiration cycles ... .

I guess I just figured on those long-dated jobs that I didn't know where the hell the market was going and that I would just do them mega wide and let the price of the short option tell me when to move my strikes in ... . The problem with the stuff farther out in time is that price in the underlying can be juking all over the place in the near term, but your short options aren't decreasing much in value as they would were they closer in time, so there's a bit more waiting involved than I would ordinarily like. As with all things I put on and don't really like after the fact, I just kinda shrug my shoulders and say, "Well, it's on now. Might as well work it ... ."

I agree your view mate. I believe once those Chinese goes holiday, oil will keep on rallying.

hey ChinaT, ah yes, the Year of the Monkey - a good year to make babies, according to the Internet. I never thought about that holiday transpo spike connection to oil demand, but that certainly makes sense.....anyway, Happy New Year, mate.

UVXY put fly combo is in about 40c net profit, even though the sweet spot is quite a ways away. The thing about UVXY spreads: if there is enough time on them, and they are getting a good run of vol, then they will probably make money, regardless of what, or where they are - by virtue of the increased iv alone.

TWTR, ER is 2/10

sold SPY puts, Mar $175/170, for 72c

Sold Puts you already bought or opened new sell position for SPY puts?

new position, sold for credit, --- when I close a short vert trade, if I say something about that here, I will usually say "bought back" & note the debit & net gain, when the trade is closed....

so, I have Mar short put verts: $175/170; $179/176, and $182/179, $185/182....also short calls $198/201 -- will be looking to IC new short call spreads but waiting to see if the S&P can break out of the chop either way.....

I bought a AAPL calls diagonal, Feb/Feb4 $101/102, for 10c

AAPL set might be a bit low.......long NFLX will pay well in a general market rally, too

if rally gets some legs I will start taking off these put spreads @ 50% maxP or better and look to roll up the short calls on that Mar $198/201, probly hold the put spreads in the $170's and look to IC against them.....

Layering on SPY iron condors here before the vol pisses out of the market. The short put wing's at the 1 SD; the short call at the edge of the expected move to accommodate that crappy vol skew (the call side may come back to bite me later, but I always have a roll in my pocket):

SPY Feb 26th 171/175/196/200 iron condor
Probability of Profit %: 66%
Max Profit: $114/contract
Buying Power Effect: $286/contract
Break Evens: 173.86/197.14

I'll look to put on that puppy tomorrow and maybe add some early March action next week if this vol holds up. Gotta keep in mind that there's an ex-dividend date in March; had to goof around with that last time around with a couple of setups at the last second because I spaced it out ... .

well it's taking its time, could be the end of it though....

NFLX crushed earnings but was dragged down in the general funk, will be back to $110+ I betcha

hey guys i recently started stock options and trading on the daily expiry, basicaly i look to see how the stock has been performing for the past week, if 80% of the time it closed higher ill trade put, 80% off the time closed lower past 5 days ill put a call end of day expiry, basicaly its taking the path of least resistance since stocks reletively tend to move smoother than forex, any advice guys?