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Let's Trade Options

  • #13,541
  • Jun 21, 2016 12:46pm Jun 21, 2016 12:46pm
Quoting ZebraSquirl
that Goddamn Tom Preston and his once a month SPY short put ... . Ridiculous how that's working out for him ... .
he's the only TT/Dough guy I look at anymore. Prolly cuz he sends me an email at 0300 every morning.

I am making money if the ^VIX is running up, but I need it to run up hard here for the next couple days. I need to see blood in the indices. I have a wide variety of VXX spreads (UVXY spreads were set up earlier and there are still a few.) I am trying to close VXX put spreads now - some are going off around 3 bag - these are things like: Jun 24/Jul 15 $17, $18, and $22 put calendars. I need to close these out, as the short legs are itm. Luckily, they can come off now in some profit, maybe really nice profit if VXX would run up another few buck to close the week.

Funny thing is, I put these on anticipating they would work as trades to catch the ^Vix reversion. I thought they would be on mid-strikes otm and the front week would expire worthless, allowing me to let the further long legs run alone after that. So, ....no complaints, I knew they could work as an outright trade. Just need the market to sell off starting about right......now.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,542
  • Jun 21, 2016 1:22pm Jun 21, 2016 1:22pm
Quoting The Fool
{quote}he's the only TT/Dough guy I look at anymore. Prolly cuz he sends me an email at 0300 every morning. I am making money if the ^VIX is running up, but I need it to run up hard here for the next couple days. I need to see blood in the indices. I have a wide variety of VXX spreads (UVXY spreads were set up earlier and there are still a few.) I am trying to close VXX put spreads now - some are going off around 3 bag - these are things like: Jun 24/Jul 15 $17, $18, and $22 put calendars. I need to close these out, as the short legs are itm. Luckily,...
very unusual option volume of 100 000 contracts placed for SPY 230 call at this Fridays expiration for 1c
  • #13,543
  • Jun 21, 2016 1:25pm Jun 21, 2016 1:25pm
Quoting Cecil Gee
{quote} very unusual option volume of 100 000 contracts placed for SPY 230 call at this Fridays expiration for 1c
Cant see that happening, I'm looking to buy puts tomorrow for Fridays exp
  • #13,544
  • Jun 21, 2016 1:28pm Jun 21, 2016 1:28pm
Quoting Cecil Gee
{quote} Cant see that happening, I'm looking to buy puts tomorrow for Fridays exp
Might be forced to buy puts near the end of today on SPY or DIA for friday and next weeks expiry
  • #13,545
  • Edited 2:45pm Jun 21, 2016 2:00pm | Edited 2:45pm
Quoting Cecil Gee
very unusual option volume of 100 000 contracts placed for SPY 230 call at this Fridays expiration for 1c
gotta be a seller, easy $100,000 for somebody who prolly trades for free.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,546
  • Jun 21, 2016 3:24pm Jun 21, 2016 3:24pm
Quoting The Fool
{quote}gotta be a seller, easy $100,000 for somebody who prolly trades for free.
Mmmm. How can I get into that club? I assume a tie is required ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,547
  • Jun 21, 2016 4:10pm Jun 21, 2016 4:10pm
Quoting ZebraSquirl
How can I get into that club? I assume a tie is required ... .
Prolly wouldn't hurt, but I spec the big fat bank account is the real ticket.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,548
  • Jun 21, 2016 4:25pm Jun 21, 2016 4:25pm
Someday when I have some spare time I will look into becoming a member of one of the options exchanges. I looked into it at the CME once a time, that's where you get into trades cheap - exchange membership. Could make sense if you have the volume, the net worth, can pass the Series 4, etc, etc....

http://cdn.batstrading.com/resources...pplication.pdf
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,549
  • Jun 21, 2016 4:41pm Jun 21, 2016 4:41pm
[quote=Cecil Gee;8992009]{quote} Might be forced to buy puts near the end of today on SPY or DIA for friday and next weeks expiry[/quote

IN for Friday expiry plus next week long vertical puts ready now for bear action
  • #13,550
  • Jun 21, 2016 5:16pm Jun 21, 2016 5:16pm
Quoting The Fool
Someday when I have some spare time I will look into becoming a member of one of the options exchanges. I looked into it at the CME once a time, that's where you get into trades cheap - exchange membership. Could make sense if you have the volume, the net worth, can pass the Series 4, etc, etc.... http://cdn.batstrading.com/resources...pplication.pdf
Ugh. Series 4 sounds "like work." Plus the, um, other "hurdles" (i.e., mounds and mounds of cash).
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,551
  • Jun 21, 2016 5:24pm Jun 21, 2016 5:24pm
Does this, um, look "tight" to you running into Brexit?

Attached Image (click to enlarge)
Click to Enlarge Name: SPX IC.jpg Size: 162 KB


May have gotten "a touch" aggressive with the rolling in ... . But the notion here is a "pin" in the 2080-2090 area running into Brexit. Max profit is $585/contract, but I'll have to chicken out prior to expiry (these are Friday a.m. settlement options), as I sure ain't holding this bag Thursday overnight ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,552
  • Jun 21, 2016 5:36pm Jun 21, 2016 5:36pm
Quoting The Fool
Someday when I have some spare time I will look into becoming a member of one of the options exchanges. I looked into it at the CME once a time, that's where you get into trades cheap - exchange membership. Could make sense if you have the volume, the net worth, can pass the Series 4, etc, etc.... http://cdn.batstrading.com/resources...pplication.pdf
Can't even ballpark a BATS membership and associated fees with all the crap they have on the schedules ... . Lol. My guess it's in the ballpark of "a lot."
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,553
  • Jun 21, 2016 6:00pm Jun 21, 2016 6:00pm
Quoting ZebraSquirl
{quote} Can't even ballpark a BATS membership and associated fees with all the crap they have on the schedules ... . Lol. My guess it's in the ballpark of "a lot."
You can either buy a CME membership outright for $380,000 or lease one for $1,700 (I assume that's per month). There are a wide variety of fees on top of that, but if you trade an average daily >16000 E-Mini's a day, you can get a .25 discount (off a .30 fee via open outcry; .47 contract Globex is more expensive). CME offers some volume credits, so I assume that 100k short calls was done with a combination of standard discounts + credits received for volume (whatever broker it is that they used; CME's a futures shop) ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,554
  • Jun 21, 2016 6:00pm Jun 21, 2016 6:00pm
My gut is we should see some selling into the mouth of the Brexit vote. Regardless of what the bookies say, the polls are still tight as a tick, and there's no sense in risking hard earned assets with such a big binary event looming. Anything can happen. I will be surprised if we don't see the market sell off on Wednesday. I need ^VIX back above 20, VXX up near $16, UVXY >$14, etc.....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,555
  • Jun 21, 2016 6:04pm Jun 21, 2016 6:04pm
Quoting The Fool
My gut is we should see some selling into the mouth of the Brexit vote. Regardless of what the bookies say, the polls are still tight as a tick, and there's no sense in risking hard earned assets with such a big binary event looming. Anything can happen. I will be surprised if we don't see the market sell off on Wednesday. I need ^VIX back above 20, VXX up near $16, UVXY >$14, etc.....
This crap we're seeing here is just intraday rotations within a range ... . Those dicks will goof around and dump right at the last moment, because that's what dicks do. These polls are still tighter than virgins on their wedding nights ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,556
  • Jun 21, 2016 6:05pm Jun 21, 2016 6:05pm
Quoting ZebraSquirl
You can either buy a CME membership outright for $380,000 or lease one for $1,700 (I assume that's per month). .. .
....a few years back you could lease a CME seat for $1,000, if my memory serves.....leasing certainly the way to go but I don't even know if that is possible on the options exchanges. It's so expensive to trade options, but I don't even have portfolio margin anywhere...that is the next step. Shit, if the ^VIX would pop to 30 again in early July, I'd be there....
"If The Fool persists in his Folly he will become wise." - William Blake
  • #13,557
  • Jun 21, 2016 6:07pm Jun 21, 2016 6:07pm
Quoting The Fool
My gut is we should see some selling into the mouth of the Brexit vote. Regardless of what the bookies say, the polls are still tight as a tick, and there's no sense in risking hard earned assets with such a big binary event looming. Anything can happen. I will be surprised if we don't see the market sell off on Wednesday. I need ^VIX back above 20, VXX up near $16, UVXY >$14, etc.....
Got into some call action before the close today for both VXX and UVXY. Level 2 was showing some late option activity; more like it was last week when both the markets and VIX's all closed green. I see some northerly activity in Wednesdays market. Whatever the Brexit outcome maybe; these equities will rise next week. That's my take anyways.
  • #13,558
  • Jun 21, 2016 6:15pm Jun 21, 2016 6:15pm
Quoting The Fool
{quote}....a few years back you could lease a CME seat for $1,000, if my memory serves.....leasing certainly the way to go but I don't even know if that is possible on the options exchanges. It's so expensive to trade options, but I don't even have portfolio margin anywhere...that is the next step. Shit, if the ^VIX would pop to 30 again in early July, I'd be there....
There's apparently plenty of leases available. It looks like some of the memberships are owned by "dead people" -- trusts and such that'll lease out the seats in perpetuity for virtually guaranteed cash flow. The seats themselves are just too damn expensive for "the little guy" (I'm using that as a relative term ... ), and they apparently rarely go up for sale (at least for CME; there's maybe a couple, tops, a quarter).
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,559
  • Jun 21, 2016 6:38pm Jun 21, 2016 6:38pm
Quoting peterdrill
{quote} Got into some call action before the close today for both VXX and UVXY. Level 2 was showing some late option activity; more like it was last week when both the markets and VIX's all closed green. I see some northerly activity in Wednesdays market. Whatever the Brexit outcome maybe; these equities will rise next week. That's my take anyways.
Just my two cents, but I generally avoid trading on the basis of where the call side/put side action is. It's usually uninformative for several reasons, one of which is that they may be positioning for something peculiar to their portfolio; something neither you nor I can see easily from just looking at strike volume. For instance, they may be selling call side to reduce cost basis; they've got a particular volume of underlying to deal with; if it's large, there will be a large number of offsetting calls to cover ... .

Naturally, some crap just sticks out like a sore thumb, like equal volume in a 3-5 wide set of strikes, which smells of spread, but I don't think I've ever made a trade on the basis of volume at particular strikes or what some hugely capitalized nobber is doing ... . I've never found a spread or an obvious options play that I'd want to copy based on looking at strike price, OI, and volume, although there was that one USO trade around December OPEC that was just a fucking stroke of genius ... .

In any event, VIX/VIX derivative products were designed for a purpose -- to hedge long market positions that would be devastated by a downturn. Traders positioning with long calls/short puts here may not be doing anything other than buying insurance for the mere possibility that the market could cave, because they've got their balls way on the wrong side of the trailer hitch, buying this turdpile all the way up to 2100 ... .

Ultimately, it's awfully hard to tell what the hell some of these kids are doing ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #13,560
  • Jun 21, 2016 6:46pm Jun 21, 2016 6:46pm
Quoting peterdrill
{quote} Got into some call action before the close today for both VXX and UVXY. Level 2 was showing some late option activity; more like it was last week when both the markets and VIX's all closed green. I see some northerly activity in Wednesdays market. Whatever the Brexit outcome maybe; these equities will rise next week. That's my take anyways.
All that being said, I'm pulling for your call side ... . Cuz I have long vol plays on ... .
Fireworks are fun ... as long as you don't blow your fingers off.
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