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Let's Trade Options

  • #13,361
  • Jun 13, 2016 12:34am Jun 13, 2016 12:34am
http://screencast.com/t/kb8lbMFAd

all the tools you need is on the Analyze tab - you can check the value of any option (or combo) for any date, you can adjust the number of options, you can globally raise/lower the i.v. (as a + or - %), you can change the under lying price, set up price slices across the P/L graph, etc, etc....you have to play with it and recognize the limitations, but it's a great tool, I use it extensively...
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,362
  • Jun 13, 2016 9:40am Jun 13, 2016 9:40am
Quoting peterdrill
Just realized you into vertical spreads. Wish I knew how to play them as they look interesting.
​hi pete, sure I do verts all the time - next time I do one I will spell it out for you
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,363
  • Jun 13, 2016 9:45am Jun 13, 2016 9:45am
Quoting The Fool
TDA margin called me on my little Roth account, first thing in the AM as I'm trying to roll some trades, just a glitch on their end & will be gone Monday but hurt me, hurt my feelings, too....not the first time that has happened, either. Anyway, I had about a +20% week, across the board - God Bless Volatility. Need some more.....
it took me two long call with Customer Service at TDA to get this cleared up. Their CS people were not bad, but I had to stay on them & insist they had a system error. which they admitted finally. Why?, I asked. Well sometimes the "system gets confused" when it is doing calendar matching. What? This happened to me at ETr one time, also....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,364
  • Jun 13, 2016 10:45am Jun 13, 2016 10:45am
Quoting The Fool
{quote}Better to close early for decent profit rather than wait for pie in the sky. I wish I had had your problem - most of what I had for June I had to roll down multiple times, chasing the ^VIX death spiral. I finally got things down to where they had a chance, but it cost me, and it was just in the last week or so. Finally, we get some vol today and I was able to close all Jun 17 UVXY, VIX, and VXX calls for modest net profits - a little over 2x for some VXX legs the best. The plus side is that I have similar trades out on all the weekly...
Thanks for the answer. With the quick moves on VIX, I was advised to keep limit entries for taking profits since the moves can happen quickly. I'm not in the best timezone for US options so can normally only monitor the first 1/3-1/2 of the US session. I'd like to hear more when you say about rolling the options down.

Quoting ZebraSquirl
I can see why just going long put might be sexy ... So I could see just going long a few VIX 20 puts for cheap (if we get that; it'll have to go "a bit" higher from here) in an expiry with enough time for a sub-20 mean reversion
I quite like this, although I got burned in early Jan when trying to sell a volume spike with VIX 18/24 vertical call spread. Was a nice pop on VIX but then it didn't drop back below 21-22 until the end of Jan. The key is getting them for cheap I suppose
  • #13,365
  • Jun 13, 2016 11:14am Jun 13, 2016 11:14am
Quoting uksnowman
{quote} Thanks for the answer. With the quick moves on VIX, I was advised to keep limit entries for taking profits since the moves can happen quickly. I'm not in the best timezone for US options so can normally only monitor the first 1/3-1/2 of the US session.
you might look at the CBOE VIX options, which trades in an extended time range. I put limit orders on every trade I make, when the trade is initially filled. I try to be realistic about what I want out of a trade, but it's rare that I don't have to go back and adjust those close orders. One also has to be realistic when rolling positions - you can roll yourself to death chasing after a losing position. I will show examples with all the steps on some trades, just surfing the nice vix waves coming in for the time being....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,366
  • Jun 13, 2016 4:56pm Jun 13, 2016 4:56pm
climbed the ladder on long vol trades today with ^VIX up 23%, I had account gains for the day 40 to 60% ....for the day. For the day...I had to look multiple times to be sure...greed now will be my undoing? ...if I had been around I might have started taking things off already, but I have lots of time, mostly strikes Jul 01 and beyond.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,367
  • Jun 13, 2016 5:30pm Jun 13, 2016 5:30pm
Quoting The Fool
​hi pete, sure I do verts all the time - next time I do one I will spell it out for you
iv has come way up in UVXY options and they are very expensive now as a result. But I can still shop for spreads around price disparities that I may find. In the pic shown I have found a Jul 01 $19/$19.5 call spread for a $0.00 mid. It won't fill for nothing, but I will put it on and fill it for 5c-10c maybe.

Vertical spreads quite easy to understand: I am long $19 call and short $19.50 call. I have the right to buy at $19 and the obligation to sell at $19.50 - so, I have entered into a trade with known constraints: I can only make $0.50 (i.e., $19.50 - $19.00) less the debit I incurred entering the spread less the comms. So, if I can fill it for a nickel I might expect a maxP of $0.40. I would put a gtc close order for 50c on as soon as I entered the trade. If UVXY goes well beyond $20, I might get all of that, and the profit would be 50c - 5c -$comms, or $0.41-$0.42. More than likely, if I saw it @ 40c I would take it off and take a 6-7 bag profit on it.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: 2016-06-13_1514uvxy1.png Size: 92 KB
Click to Enlarge Name: 2016-06-13_1529uvxy2.png Size: 69 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,368
  • Jun 13, 2016 10:43pm Jun 13, 2016 10:43pm
Quoting The Fool
{quote}which 20 put? The Jun 15?
Oh, I was thinking farther out in time to allow for a break back below 20 ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,369
  • Jun 13, 2016 10:45pm Jun 13, 2016 10:45pm
Quoting The Fool
http://screencast.com/t/kb8lbMFAd all the tools you need is on the Analyze tab - you can check the value of any option (or combo) for any date, you can adjust the number of options, you can globally raise/lower the i.v. (as a + or - %), you can change the under lying price, set up price slices across the P/L graph, etc, etc....you have to play with it and recognize the limitations, but it's a great tool, I use it extensively...
I need to putz with it more when I have a bit of time ... . I don't nearly use the platform to its full potential. Thanks tons.
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,370
  • Jun 13, 2016 11:00pm Jun 13, 2016 11:00pm
Quoting uksnowman
{quote} Thanks for the answer. With the quick moves on VIX, I was advised to keep limit entries for taking profits since the moves can happen quickly. I'm not in the best timezone for US options so can normally only monitor the first 1/3-1/2 of the US session. I'd like to hear more when you say about rolling the options down. {quote} I quite like this, although I got burned in early Jan when trying to sell a volume spike with VIX 18/24 vertical call spread. Was a nice pop on VIX but then it didn't drop back below 21-22 until the end of Jan. The...
I had similar setups on in the same time frame ... . Unfortunately, VIX/VIX derivatives didn't cave as quickly as the setups required, only to totally implode later ... .

Most of my setups have a GTC take profit order: with credit spreads, iron condors, and short strangles, I shoot for 50% max profit; debit spreads, short straddles, iron flies, 25%. Calendars and diagonals, I just tend to "play by ear," since they don't really have a predetermined profit potential at setup ... .

With the VIX/VIX derivative "elevator down" plays, I'll probably do something like a calendar or diagonal that has more time to work out if it doesn't immediately cave like you need it to. I'll post a setup if I put one on.
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,371
  • Jun 13, 2016 11:18pm Jun 13, 2016 11:18pm
Rolled the call side on my remaining "monster" SPX iron condor, from June 24th 2145/2155 down to 2130/2140 for an additional $105/contract, resulting in a June 24th SPX 2045/2055/2145/2155 iron condor. Still shooting to take it off at the original profit target of 50% max or about $150/contract ... .

Last week, was getting a little concerned about the call side; with these last few days of price action, now I'm starting to fidget over the put ... . Amazing how a few days can make a huge difference in how your setups are doing ... .

Tomorrow, I'll look to put another one of those puppies on in the June 30th Q or July 1st expiry ... . Finally, some premium to sell here.
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,372
  • Jun 13, 2016 11:25pm Jun 13, 2016 11:25pm
Quoting ZebraSquirl
Oh, I was thinking farther out in time to allow for a break back below 20 ... .
I have some VXX put calendars, put these on a month ago at various strikes either side of $20....the idea here was either to make money outright on the calendar at its expiry, or (maybe better) catch the vol reversion with them and be left with some long puts that go several $ itm. The Jun24/Jul15 shown cost me 20c, but if VXX is trading below $20 at Jun 24 I might let it run if it seems ^vix is done with its run
Attached Image (click to enlarge)
Click to Enlarge Name: 2016-06-13_2119vxxputs1.png Size: 67 KB
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,373
  • Jun 13, 2016 11:27pm Jun 13, 2016 11:27pm
Quoting The Fool
climbed the ladder on long vol trades today with ^VIX up 23%, I had account gains for the day 40 to 60% ....for the day. For the day...I had to look multiple times to be sure...greed now will be my undoing? ...if I had been around I might have started taking things off already, but I have lots of time, mostly strikes Jul 01 and beyond.
Glad I have tomorrow off ... . Need to look at pulling at least some stuff off in profit ... . I generally just look at the phone app at work for a general notion as to how trades are going, but it isn't the best for picking and choosing which setups to peel off ... . It's okay if you've only got one setup on in a particular instrument, but when you've got 15 ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,374
  • Jun 13, 2016 11:30pm Jun 13, 2016 11:30pm
Quoting ZebraSquirl
Finally, some premium to sell here.
I know, right? WE just need the Brexit angst to reach maximum sphincter clench....I am shopping reversion trades....still a noob here as you don't get these chances very often, but there's gotta be some good ways to catch the fallback. I am presupposing a Bremain, but I already have buttloads of long vol trades running and it is likely I will break even on the whole pile of em within the next week, as I continue to close early ones out and take off partials on the long dated ones....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,375
  • Jun 13, 2016 11:31pm Jun 13, 2016 11:31pm
Quoting The Fool
{quote}I have some VXX put calendars, put these on a month ago at various strikes either side of $20....the idea here was either to make money outright on the calendar at its expiry, or (maybe better) catch the vol reversion with them and be left with some long puts that go several $ itm. The Jun24/Jul15 shown cost me 20c, but if VXX is trading below $20 at Jun 24 I might let it run if it seems ^vix is done with its run {image}
Yeah. I'm not at all well positioned for the elevator ride down, which is okay ... . I can still get in on that here with some setups ... . As usual, it's the old "Are we there yet? Are we there yet?" with the top of the volatility arc ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,376
  • Jun 13, 2016 11:35pm Jun 13, 2016 11:35pm
Quoting ZebraSquirl
It's okay if you've only got one setup on in a particular instrument, but when you've got 15 ... .
It gets confusing. On one account, the VXX positions run to two 8.5x11 sheets when I export them to Excel and print them out. I will do that, put them in Excel, and then color code the matching trades, space them out, etc.

I am still alarmed that TDA mismatched the legs of some spreads that I had clearly matched in a balanced way, froze my account for over a day, sent me margin call notices, etc. I find myself reluctant to put on trades there now, but I have to, as I am up to my eyebrows in phat trades that must be managed....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,377
  • Jun 13, 2016 11:45pm Jun 13, 2016 11:45pm
Quoting The Fool
{quote}It gets confusing. On one account, the VXX positions run to two 8.5x11 sheets when I export them to Excel and print them out. I will do that, put them in Excel, and then color code the matching trades, space them out, etc. I am still alarmed that TDA mismatched the legs of some spreads that I had clearly matched in a balanced way, froze my account for over a day, sent me margin call notices, etc. I find myself reluctant to put on trades there now, but I have to, as I am up to my eyebrows in phat trades that must be managed....
For several weeks running, I would get a margin call flag on my account every Monday ... . Drove me nuts, checking each setup to see if there was an ex-divvy I'd missed, I'd been randomly assigned, or some such nonsense. Couldn't find anything amiss, had plenty of cash ... . Supposed cash sweep vehicle glitch ... . Made me repetitively nervous.
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,378
  • Jun 13, 2016 11:50pm Jun 13, 2016 11:50pm
Quoting The Fool
{quote}I know, right? WE just need the Brexit angst to reach maximum sphincter clench....I am shopping reversion trades....still a noob here as you don't get these chances very often, but there's gotta be some good ways to catch the fallback. I am presupposing a Bremain, but I already have buttloads of long vol trades running and it is likely I will break even on the whole pile of em within the next week, as I continue to close early ones out and take off partials on the long dated ones....
For some reason, I haven't been fading spikes. I guess it's because the "top" of VIX isn't clean, and you don't know if it's going to go to 25 or 50 (although that late August 50 -- yeesh). However, I think if I'm not fading these spikes, I'm just being a ginormous sissy, particularly if I use a defined risk setup that has plenty of time to work out ... . Naturally, you pay for the time, unfortunately ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,379
  • Jun 13, 2016 11:58pm Jun 13, 2016 11:58pm
I am shotgunning the VXX put spreads, hope to have something on that has a good finish or that puts me in the long legs ready to catch the drop....actually looking good....but I put them all on BEFORE the vol rush got going. If you wait, you pay more.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,380
  • Jun 14, 2016 12:06am Jun 14, 2016 12:06am
Quoting ZebraSquirl
For several weeks running, I would get a margin call flag on my account every Monday ... . Drove me nuts, checking each setup to see if there was an ex-divvy I'd missed, I'd been randomly assigned, or some such nonsense. Couldn't find anything amiss, had plenty of cash ... . Supposed cash sweep vehicle glitch ... . Made me repetitively nervous.
thanks for sharing that.....my opinion of TDA even lower now....
"If The Fool persists in his Folly he will become wise." - William Blake
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