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  • #41
  • Jul 12, 2016 10:28am Jul 12, 2016 10:28am
Bought to close SPX July 22nd 2020/2030 short put vertical for a .15 debit; it's done its job. Rolled SPX July 22nd 2110/2120 short call vert to July 29th 2115/2125 short call vert for a .75 debit and sold an SPX July 29th 2085/2095 short call vertical to finance the call side roll, completing a July 29th 2085/2095/2115/2125 iron condor. The strike improvement on the call side isn't much, but I tend to make these strike improvements small and incrementally over time.

Bought VIX Aug 17th 12.5P/14.5P/15C/17C "Super Bull" for a .25 debit. The "Super Bull" is made up of two parts -- a short put vertical (bullish) assumption, for which you receive a credit; and a long call vertical (also bullish assumption), for which you pay a debit. In essence, the short put vertical pays for the long call vertical. Ideally, I'm looking for an up move at some point to take off either the short put vert in profit, the long call vert in profit, or the entire setup off at once ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #42
  • Jul 12, 2016 6:40pm Jul 12, 2016 6:40pm
Ugh. I start to get itchy waiting for decent earnings season premium selling plays ... . Usually the first one I play is NFLX, which is next week ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #43
  • Jul 13, 2016 3:07pm Jul 13, 2016 3:07pm
For some reason, and in spite of its being easily Googlable (if that's a word), I get a lot of questions about brokers. Here are the best ones: http://www.nasdaq.com/investing/online-brokers/ My two cents: stick with the large, reputable brokers. If anything the Swissie flashcrash and/or the Binary options craze has taught us, poorly capitalized brokers go under and less than reputable brokers take your money ... .

That being said, they're not all created equally. Some brokers' platforms blow chunks, but their pricing's great; other's brokers' platforms are great, but their pricing's not so hot, unless you're doing a lot of trades and a lot of volume.

For platform, TDA's ThinkOrSwim beats most others, hands down, followed by TDA's affiliate, Dough (www.Dough.com) (it's somewhat a matter of taste; ToS has a huge number of bells and whistles that novices just won't use; Dough's easy on the eyes and easy to use). I think you can sign up to Dough for free, which is probably worth it just for the graphical user interface (although all the excellent educational materials that are linked to it (e.g., DoughTV) are a ginormous bonus). Additionally, I think you get some kind of break on fees/commissions if you do Dough's little options educational program (you do it online) and then open a TDA account through Dough (don't quote me on that).

With respect to pricing, most brokers are set up with two "per trade" components: a flat fee per trade + a per contract commission. In other words, you pay X dollars for every trade regardless of contract size and then a second charge that is X dollars times the number of contracts being traded. For some brokers, the per contract fee gets smaller as the number of contracts you trade gets larger, but the per trade fee remains the same for the first x number of trades per month and/or the per trade fee gets smaller when you exceed a particular number of trades per month or they exceed a particular dollar value. In other words, comparing fees/commissions between brokers is often difficult, since it depends a lot on the number of trades you're doing and the overall dollar value of those trades.

Naturally, if you're only doing 1 or 2 "small" options trades (e.g., 1 or 2 contracts) per month, it'll be easier to compare ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #44
  • Jul 14, 2016 4:20pm Jul 14, 2016 4:20pm
Quoting ZebraSquirl
Bought VIX Aug 17th 12.5P/14.5P/15C/17C "Super Bull" for a .25 debit.
Today:

Doubled down with another VIX Super Bull in the same expiry with the exact same strikes, but for cheaper (a .15 debit), resulting in a cheaper, per contract net value for the entire position. Not looking for much out of that trade, to be honest. I'll be happy to walk away with $50/contract (which would actually be like a 250% return, since the net contract value is currently $20). As usual, however, a pop will be required out of VIX ... . A 250% return may seem like "a big thing," but, as usual, I do these "small," so it's not like it's going to be making my month, quarter, or year ... .

Delta Hedge: Sold RUT Aug 29 1120/1130 short put vertical for a 1.10 credit ($110). This is a delta hedge to protect the call side of an existing setup (an iron condor) that I don't want to roll the put side up on here (because (a) there isn't much time left in the setup; and (b) rolling toward current price while keeping the rolled spread "high probability" isn't decently profitable). Unfortunately, this results in a unit imbalance on the put side (I've got one more RUT put spread on than RUT call spreads, but I'll keep an eye on my RUT net delta. If it skews back long, I'll match this delta hedge up with a call side. Otherwise, I'll ride it to expiration and/or take it off when it's done its job).

Roll (Call Side Defense): Gosh, doing a lot of call side defense here. Rolled NDX Aug 5th 4350/4375 short put vertical to 4400/4425 for an .90 ($90) credit. I've rolled this put side up so much that I've now got a 4350/4375/4375/4400 "iron butterfly" (both the short call and the short put at the same strike). This is another setup that I will probably not be rolling the put side further up. I generally don't like to roll iron condors "inverted" (put side up over call side or vice versa). Instead, I'll watch the setup's net delta and hedge with a separate spread set up in a different expiry, usually farther out in time.
Fireworks are fun ... as long as you don't blow your fingers off.
  • #45
  • Jul 15, 2016 7:01am Jul 15, 2016 7:01am
Bought ZIOP covered call at open.

Shares @ 4.90 with Aug 19 5 short call, resulting in a cash basis of 4.20/share, so my per contract max profit is $80/contract if called away at $5/share (i.e., shares only need to be .10 up from here at expiry).

Thank you, implied volatility (currently at 100%+ in this little fella).
Fireworks are fun ... as long as you don't blow your fingers off.
  • #46
  • Jul 15, 2016 2:54pm Jul 15, 2016 2:54pm
Turkish coup attempt in progress ... . http://www.cnbc.com/2016/07/15/gunfi...of-ankara.html Could be interesting for markets at Asian open on Monday ... . Naturally, early days; facts sketchy ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #47
  • Jul 16, 2016 6:43pm Jul 16, 2016 6:43pm
Unfortunately, the only underlying announcing earnings next week that has sufficient implied volatility to consider selling premium in is NFLX, with an implied volatility of 52%.

It announces earnings on Monday after market close, so look to put on a play some time on Monday, preferably right before the NY close.

Preliminarily (I'm checking this crap in off hours, so it's rarely spot on), here are the possible setup metrics:

NFLX July 29th 85.5/111 short strangle
Probability of Profit: 74%
Max Profit: $215/contract
Max Loss: Undefined
Break Evens: 83.35/113.15

NFLX July 29th 81.5/85.5/111/115 iron condor
Probability of Profit: 70%
Max Profit: $99/contract
Max Loss: $301/contract
Break Evens: 84.51/111.99
Fireworks are fun ... as long as you don't blow your fingers off.
  • #48
  • Jul 16, 2016 7:58pm Jul 16, 2016 7:58pm
I'm not currently set up to trade spot forex, but if I were, EURTRY, USDTRY just say "short" post-failed coup all over them ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #49
  • Jul 16, 2016 8:15pm Jul 16, 2016 8:15pm
CMG announces earnings on Thursday. It's very juicy premium wise, but the bid/ask on the options is just incredibly horrid. Here's an example: the Aug 19th 345/465 short strangle is 6.40, the mid is 9.20, and the ask is 12.00. Hardly a "tight" bid/ask ... . The thing to do with junk like that is to put in for a fill above the mid; if it fills, it fills ... . No sense in paying more than you have to (or, in this case, getting less credit than you could were you just a touch more patient).
Fireworks are fun ... as long as you don't blow your fingers off.
  • #50
  • Jul 16, 2016 9:21pm Jul 16, 2016 9:21pm
I think this guy is reading wayyy too much into this:

Attached Image (click to enlarge)
Click to Enlarge Name: % Spread.jpg Size: 86 KB


It really isn't a "signal" of anything beyond the fact that some think that August will be way more volatile than current spot indicates. At some point, "somebody" will have to converge; spot may do all the converging, the futures may do all of it, or it may be a little of both ... .

One thing it does tell us, though, the contango in things like VXX is awfully "brutal" here ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #51
  • Jul 17, 2016 1:50pm Jul 17, 2016 1:50pm
When you scrounge around for premium selling, something eventually turns up:

NVAX covered call: 100 shares @ 7.56; sell Aug 19th 8 short call; whole package 6.20. $170 max prof if called away at 8 (27% ROC).

These are off hours quotes, so I doubt it will have its current "sexy allure" at NY open.
Fireworks are fun ... as long as you don't blow your fingers off.
  • #52
  • Jul 17, 2016 2:23pm Jul 17, 2016 2:23pm
Quoting ZebraSquirl
When you scrounge around for premium selling, something eventually turns up: NVAX covered call: 100 shares @ 7.56; sell Aug 19th 8 short call; whole package 6.20. $170 max prof if called away at 8 (27% ROC). These are off hours quotes, so I doubt it will have its current "sexy allure" at NY open.
Showing .75 for Aug 8 calls. Decent OI so quote should be pretty close to market price.
7.56-.75=6.81 total cost
Max profit = 1.19

***Good OI in Oct calls & nice premium but would have to sit through earnings.
***Prefer call spreads in biotech rather than covered calls in case of "blow-up" from phase 1,2,3 results.
Attached Image (click to enlarge)
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  • #53
  • Jul 17, 2016 5:44pm Jul 17, 2016 5:44pm
Quoting srt
{quote} Showing .75 for Aug 8 calls. Decent OI so quote should be pretty close to market price. 7.56-.75=6.81 total cost Max profit = 1.19 ***Good OI in Oct calls & nice premium but would have to sit through earnings. ***Prefer call spreads in biotech rather than covered calls in case of "blow-up" from phase 1,2,3 results. {image}
May be the bid/ask on the actual stock that is making this look "sexier" than it'll be at NY open ... . But even 1.19/6.81 is a 17.5% ROC, which ain't shabby.

I can understand the desire to go bull call spread on stuff like this. As always, there are trade-offs: a bull call spread has greater max profit potential if the underlying explodes to the moon vs. the covered call is basically "capped" off at the short call strike price (although you can always roll it out to reduce your cost basis further); the bull spread is on a timer vs. the covered call isn't, since you own the underlying. I guess I'm just going for the "no timer"/capped profit option; just looking to get to my short call price and then bow out. Don't wanna be married to the darn thing, since these things can cave just as easily as they can pop ... .

Good point, though.
Fireworks are fun ... as long as you don't blow your fingers off.
  • #54
  • Jul 17, 2016 5:48pm Jul 17, 2016 5:48pm
Quoting srt
{quote} Showing .75 for Aug 8 calls. Decent OI so quote should be pretty close to market price. 7.56-.75=6.81 total cost Max profit = 1.19 ***Good OI in Oct calls & nice premium but would have to sit through earnings. ***Prefer call spreads in biotech rather than covered calls in case of "blow-up" from phase 1,2,3 results. {image}
Also, looking at the chart, a bull call spread would have been sweet from down below at 4.50-5.00 to even here ... . Oh, were I not to have my head up my ass (an unfortunately frequent occurrence).
Fireworks are fun ... as long as you don't blow your fingers off.
  • #55
  • Jul 18, 2016 2:16pm Jul 18, 2016 2:16pm
GDX (gold miners):
-long term trade
-current price @ 29.98

Ratio Spread:
Buy 1 Dec 27C @ 5.00 and Sell 2 Dec 39C @ .94
$500-$188=$312

-max. risk = $312 (if price below 39 @ expiration)
-max. risk = unlimited (if price above 39)(just watch & roll if price approaches 39)
-max. profit = $888
-paying $14 in premium @ quoted prices

***I've been in GDX call spreads since the teens. Just keep rolling up & out. Currently in Sept 27/36 ratio spread.
Attached Image(s) (click to enlarge)
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  • #56
  • Jul 18, 2016 3:18pm Jul 18, 2016 3:18pm
Quoting ZebraSquirl
Unfortunately, the only underlying announcing earnings next week that has sufficient implied volatility to consider selling premium in is NFLX, with an implied volatility of 52%. It announces earnings on Monday after market close, so look to put on a play some time on Monday, preferably right before the NY close. Preliminarily (I'm checking this crap in off hours, so it's rarely spot on), here are the possible setup metrics: NFLX July 29th 85.5/111 short strangle Probability of Profit: 74% Max Profit: $215/contract Max Loss: Undefined Break Evens:...
Filled the NFLX iron condor option for .94 ($94/contract) ... . Looks like rippage post announcement ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #57
  • Jul 18, 2016 3:19pm Jul 18, 2016 3:19pm
Quoting ZebraSquirl
{quote} May be the bid/ask on the actual stock that is making this look "sexier" than it'll be at NY open ... . But even 1.19/6.81 is a 17.5% ROC, which ain't shabby. I can understand the desire to go bull call spread on stuff like this. As always, there are trade-offs: a bull call spread has greater max profit potential if the underlying explodes to the moon vs. the covered call is basically "capped" off at the short call strike price (although you can always roll it out to reduce your cost basis further); the bull spread is on a timer vs. the...
Yeah, that NVAX trade was less sexy on open ... . I'll have a look at it again tomorrow, see if it still gives me that "come hither" look ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #58
  • Jul 18, 2016 3:19pm Jul 18, 2016 3:19pm
Quoting srt
GDX (gold miners): -long term trade -current price @ 29.98 Ratio Spread: Buy 1 Dec 27C @ 5.00 and Sell 2 Dec 39C @ .94 $500-$188=$312 -max. risk = $312 (if price below 39 @ expiration) -max. risk = unlimited (if price above 39)(just watch & roll if price approaches 39) -max. profit = $888 -paying $14 in premium @ quoted prices ***I've been in GDX call spreads since the teens. Just keep rolling up & out. Currently in Sept 27/36 ratio spread. {image} {image}
Excellent trade for a trending issue ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #59
  • Jul 19, 2016 2:39pm Jul 19, 2016 2:39pm
SPX sideways action today ... . What am I saying, sideways action for last three days ... . Lol.

PGNX covered call
Bought 100 shares 5.31
Sold Aug 19th 6 Short Call
Whole Package: $463 ($4.63/share is my cost basis)
Max Profit: $137 if called away at $6

Of course, it dropped after I put this on ... .

I look at these sub-$10 trades as engagement trades while I'm waiting for some volatility to reappear in my bread and butter index trades (not looking good for that short-term; VIX finished at $12 or so today ... ).
Fireworks are fun ... as long as you don't blow your fingers off.
  • #60
  • Jul 19, 2016 2:42pm Jul 19, 2016 2:42pm
Quoting ZebraSquirl
{quote} Filled the NFLX iron condor option for .94 ($94/contract) ... . Looks like rippage post announcement ... .
Out of the call side for a .02 debit. Hanging on to the put side for now to see if it can hold 85 ... .
Fireworks are fun ... as long as you don't blow your fingers off.
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