ROLLING (IRA): SPY DECEMBER 18TH 255 SHORT CALLS TO 260
... and selling the 250 short puts to finance for a net 2.90/contract credit. (See Financing Strike Improvement Post, Below).
Notes: My original thought process behind just rolling my 255's out "as is" over time was that I (a) didn't have all that much time until retirement; (b) have experienced a couple of those 40% sell-offs and didn't want to endure another one of those here; and (c) just plain ass slept better at night knowing that I had a ton of down side protection on in the event of a massive sell-off, even though I knew that my shares could literally be called away at any time. Naturally, I didn't expect that this would continue with its up grind ad infinitum (or so it seems), so am throwing a little caution to the wind here to improve those short calls strikes by 5, while getting paid some premium to do so, all in a high volatility environment.
I would also note that I overwrote some calls via a laddered call diagonal, so am net delta short on my SPY position in the IRA at the moment. Consequently, I am less hesitant to add back in some long delta, particularly where the calls are buried so deeply in the money (the 260's are at the 81 delta at the moment). Naturally, doing this here comes at a price, just as overwriting calls did, but I'm not doing a ton here in the IRA at the moment, and this gives me a way to deploy some idle capital, albeit at the risk of potentially acquiring additional SPY shares at 250, which I'm not particularly keen on.
Notes: My original thought process behind just rolling my 255's out "as is" over time was that I (a) didn't have all that much time until retirement; (b) have experienced a couple of those 40% sell-offs and didn't want to endure another one of those here; and (c) just plain ass slept better at night knowing that I had a ton of down side protection on in the event of a massive sell-off, even though I knew that my shares could literally be called away at any time. Naturally, I didn't expect that this would continue with its up grind ad infinitum (or so it seems), so am throwing a little caution to the wind here to improve those short calls strikes by 5, while getting paid some premium to do so, all in a high volatility environment.
I would also note that I overwrote some calls via a laddered call diagonal, so am net delta short on my SPY position in the IRA at the moment. Consequently, I am less hesitant to add back in some long delta, particularly where the calls are buried so deeply in the money (the 260's are at the 81 delta at the moment). Naturally, doing this here comes at a price, just as overwriting calls did, but I'm not doing a ton here in the IRA at the moment, and this gives me a way to deploy some idle capital, albeit at the risk of potentially acquiring additional SPY shares at 250, which I'm not particularly keen on.
Comment:
Wider context: www.tradingview.com/chart/CKMSqrHT/
Comment:
Posted a link to the entire position, so that you can see the various options in context, albeit without the number of shares shown or the number of contracts, although this isn't particularly important, since all sets of contracts are equal in number. My cost basis in the shares is below 220, which is when I last acquired, and the entire setup has a net delta of approximately +2.00 per lot (i.e., basically flat net delta).
