... for a .77/contract credit.
Metrics:
Probability of Profit: 89%
Max Profit: $77/contract
Max Loss: $223/contract
Break Even: 16.77
Notes: This is way farther out than I generally like to go with these, but with the /VX term structure the way it is currently and the way it has been for the past several months, this is probably the best I'm going to get until...
You may have heard me say in the past that you should use high implied volatility strategies in high implied volatility environments and low volatility strategies in low volatility environments. A credit spread is generally considered a high volatility environment play, while a debit spread is considered a low volatility environment play.
Consequently, since...
... for a .50 credit.
Probability of Profit: 63%
Max Profit: $50/contract
Max Loss: $150/contract
Break Even: 52.50
Notes: Setting this up at the 50 delta strike. The set up isn't that "sexy" in terms of premium collected versus max loss, but going small on this minor VIX pop. Would prefer going 50 delta short call vert in this instrument on corresponding /VX...
... for a .75 ($75)/contract credit.
Another "Term Structure" trade (See Posts, Below). Since the beginning of the year, all of them have been setup as 16/19's or 17/20's and have been filled for around .75/contract.
Naturally, I look to set these up in expiries of 90 days or less; 120 days, after all, is an awfully long time to "get your candy." That being...
This is another one of them there "Term Structure" trades which use the VIX futures as a guide for the short call strike.
Here, I'm using /VXH7, which is the March VIX futures contract, which is currently trading at 15.72, so I'm using the 16 short call in VIX.
... Filled for a .71 credit.
Notes: This is a little bit farther out in time than I generally like to...
... for a .66 ($66)/contract credit.
I did this on 12/30, but neglected to post it.
This was another VIX "Term Structure" trade (See Post Below) using the Feb VIX futures contract price as a guide. The Feb contract was going for 16.55, so I used the nearest strike above that price, the 17, for my short call leg.
With these, I'm playing it "by ear" as to the...
I'm doing a little planning ahead here for the UVXY 5-1 reverse split, currently scheduled to occur on Jan 12th.
Truth be told, UVXY is not one of my favorite VIX derivatives to play, largely due to options liquidity, which leads to wide bid/asks that you have to putz with in order to get filled for something vaguely approaching a "fair price." Nevertheless, I...
With Dough transitioning over to TastyWorks (it's basically Dough on steroids), I'm looking to wind up positions I've got on here over the next several weeks so that I can transition over to TastyWorks, which will not interface with TDA accounts. While I can naturally use ThinkOrSwim (ToS), it just doesn't have the features of Dough that I've come to know and...
As previously noted in other posts, the short volatility product plays I like most are "Term Structure" plays in VIX and "Contango Drift" plays in VIX derivatives, with the preference being toward the latter play, since you're getting in on a pop in VIX and then taking advantage of "Contango Drift" in the derivatives to the downside (in UVXY, VXX; SVXY is an...
The last VIX pop around elections, I chose to piddle with an SVXY ATM short put credit spread (see post below). It worked out great, but SVXY isn't the most liquid thing in the world (I knew that going in).
In comparison, VIX options are about the cleanest short volatility setup you can get, although a small drawback is that you won't get the added contango...
I don't trade news, but this is an event whose outcome I think is now relatively certain (Bremain) such that it might be worthwhile to take a small position to take advantage of the relief rally that will occur if that is the result. Naturally, I could be totally wrong on the result, but the probability of a Bremain vote is currently higher than a Brexit vote, if...
Selling the "Big Boy" on strength here (and looking like it might be possibly turning over on the 1H and 4H time frames ... )
But going small, narrow, defined:
Probability of Profit: 74%
Max Profit: $110/contract
Buying Power Effect/Max Loss: $390/contract
Notes: Look to leg into the short put vertical side on weakness to complete a full iron condor ... .
After closing the short call wing of my original iron condor, I rolled out the short put wing down one strike and out one week to the April 8th expiry to give it a little more room and a little more time.
I'm just matching that rolled out side with a new call wing to hedge, resulting in an April 8th 1050/1060/1100/1110 iron condor.
Since I rolled out the short...
Several weeks ago, I iron condored GLD on the notion that we would see some resistance around the 111 area. The short call spread of that original iron condor was 111/114. I stripped off the short put side at near worthless and also added to the position with a GLD 115/118 short call spread. Needless to say, 111 provided scant short-term resistance and now GLD...
