OPENING: X FEB 22ND/APRIL 18TH 18/22.5 UPWARD CALL DIAGONAL
... for a 3.09/contract debit.
Metrics:
Max Loss/Buying Power Effect on Setup: $309
Max Profit on Setup: $141
Break Even on Setup: 21.09 vs. 20.71 spot
Debit Paid to Spread Width Ratio: 68.7
Delta: 37.91
Theta: .61
Notes: The front month short doesn't pay for all of the extrinsic in the back month long (which is generally why you want your break even to be at or below spot), but I'm somewhat fine with that given the debit paid to spread width ratio.
On a side note: I'm getting into quite a bit of long delta here, so will have to look for opportunities to add short delta, either on a per instrument basis or via a broad market short delta setup ... .
Metrics:
Max Loss/Buying Power Effect on Setup: $309
Max Profit on Setup: $141
Break Even on Setup: 21.09 vs. 20.71 spot
Debit Paid to Spread Width Ratio: 68.7
Delta: 37.91
Theta: .61
Notes: The front month short doesn't pay for all of the extrinsic in the back month long (which is generally why you want your break even to be at or below spot), but I'm somewhat fine with that given the debit paid to spread width ratio.
On a side note: I'm getting into quite a bit of long delta here, so will have to look for opportunities to add short delta, either on a per instrument basis or via a broad market short delta setup ... .
Trade active:
Mmm. Missing a roll here ... . On 1/9, rolled the 2/22 22.5 short call to the 3/15 22 for a .36 credit; scratch point at 2.73.
Trade closed manually:
Covering here on this short call breaking up move for a 3.41/contract credit; .68 ($68) profit/contract; 22% ROC.