Weeklys 2

July 12, 2012.
To shorten the information on this page, I’ve cut it into sections. Everything prior to July 1,2012 is on this page.


This is the page for anything related to short-term option trades. These are my real world trades, although I may not list all trades.

{{{gold}}}

Trades for week of Jun 25, 2012

842am
RUT=761.20
Collected only 85 cents. Midpoint was $1 then dropped to $0.95
RUT Jun ’28 ’12 730/735p; 785/790c

Entered order for more at 95 cents
Filled as the market rallies and the call spread gains value.

No more weeklys trades for today.
I may try again tomorrow.

Jun 27

8:33 am
So far a lucky trade. Cannot beat that.
Hope to exit end of day.
Currently bidding 25 cents, but that is probably too low.

10:34 am
Covered put spread at 5 cents.
Cancelled 25 cent bid for whole iron condor.

2:54 pm
Decision time. The shorts are 9 points OTM, carry a 21 delta, and the market is about to close. A higher opening tomorrow is going to mean that risk is quite high. On the other hand, a down opening may not be enough to get this spread at a cheap price. We obviously have more to lose than we have to gain by holding.

If trading strictly by profit/loss, I would exit, take the small gain and be satisfied. So what is preventing me from exiting? I don’t know. The arguments are all in favor of being afraid.

2:58
RUT = 775.49
Entered a timid bid of 65 cents. The offer is 90 cents.

3:01 went to 70 cents, but there is no chance…unless bad news comes out in the next few minutes

Jun 28

8:32 paid 25 cetns. RUT= 770

Very happy to be out pre-SCOTUS news


Trades for Jun 18

Did not get my price
Trades abandoned.
Will try again tomorrow.

Was working RUT 730/735P; 795/800C and also 725/730P; 795/800C

June 19

8:36 am RUT = 776

Collected 75 cents for 745/750P; 795/800C
Not a wonderful price, and I only received a partial fill (4 out of 10)
Canceled balance.

9:20 RUT ~782.
Added 6 lots; collected $1.20
RUT 7550/760P; 795/800C

Jun 20

9:30 am. Covered put spread at 5 cents


Trades for Jun 11, 2012

8:43 am.
RUT = 771.05
Bought (or sold, if you prefer) iron condor: 740/745P; 790/795C
Midpoint 1.10, settled for $1.00 credit.

Just the one trade for today.

2:57PM
Butterfly roll. Paid 40 cents to move down the puts
Bought 745 puts
Sold 740 puts
Bought 735 puts
Ratio 1 x 2 x 1

Update Jun 13

2:13 pm
RUT ~752
Covered call spread @ 5 cents

Update Jun 14

2:14pm. Hoping to cover several open positions but the news has results in wide markets and high IV. To get out of anything now is going to cost.

2:54, with RUT @762, I paid an unbelievably high 20 cents to cover the put spread. With the wild rally, decline and rally – who know what news will arrive overnight.


Trades for Jun 4, 2012

1) Typical iron condor: 10 lots;
8:38 am. RUT = 742.61
Collected $0.85 for the RUT Jun 07 ’12 iron condor: 705/710P/770/775C

2) Broken Wing Iron Condor
8:33 am
Sold 5 705/710 put spreads
Sold 5 770/780 call spreads
Credit $1.15.
Sold another 5 and collected $1.20

Note margin on this trade (for the total position; 10 lots) is higher: $5,000 for the puts plus $10,000 for the calls. No offsetting margin break from Interactive Brokers.

Update June 6

Bot in put spreads at 5 cents for both trades. InteractiveBrokers executed the trade three minutes before OptionsHouse.

Comment: Yesterday I got greedy. I was bidding 5 cents to cover the 770/775 call spread, but did NOT bid 5 cents for the 775/780 call spread (which is part of my 10-point call spread)

Update June 7

7:54am
OK. The chickens have come home to roost. I was hoping that the rally would be one day affair, and did not roll down the calls yesterday.

I have to cut risk now. This is going to cost two or three weeks worth of profits, but I mention that as a point of reference. It does not affect my decision to cut losses. Going forward, the question is: Has the market become too volatile for Weeklys iron condors?

8:35 am, RUT +10
Paid 5.80 for the 570/580C spread. It’s too much to have paid, but I feel better to be out. This loss is far greater than just a couple of weeks worth of profits. I lost a substantial portion of my Weeklys profits with this single trade.

Still working the 700/775 spread

8:46 am
Paid $2.90 for 770/75 spread to complete the semi-disaster.

Not a good week.


Trades for May 21, 2012

These are my real trades, and include a small bearish bias.

1) 8:31 RUT: 750

Premium $1.05
RUT May 24 710/715P; 775/780C

8:40 am. Side comment: Not opening any Aug right now. Do not like the RUT premium.

2) Have had this order in almost all day. No luck:

RUT May 24 705/710P; 780/785C. I want an 80 cent credit. Midpoint was 90 cents when entered.
Will probably cancel soon and wait until tomorrow or another trade.

9:06 am; RUT 750.32. Filled at 80 cents

3) 9:50 am. Not liking what I have so far did not deter me from another:
RUT = 757.

Credit 90 cents
RUT May 24 720/725P; 785/790C

I’m finished. Enough size for one week.

3:04 PM This move was not large enough to require any action. A gap higher tomorrow will be a problem.

Update May 22, 2012

9:26 am
RUT = 769
Entered a 40 cent bid to roll down the 775/780 call spread by 5-points (The butterfly roll). I won’t keep this bid too long. I will either raise it or cancel it. The 10-point roll (condor roll) is an alternative, but is not my preference. Update: 9:40 am. Roll bid canceled.

9:29 am
Bought 710/715 put spread @ $0.05

9:35 am
Did something unusual for me. I rolled up the put spread.

RUT = 769
Sold Aug 740/745 put spread @ 0.45 (13 delta)

9:54 am
RUT is 79
Bought 720/725 put spread at $0.05

NOTE: The only put spread I did not yet buy is the farthest OTM: 705/710. This is through OptionsHouse and it does not say good thins about them as a broker.

11:13 am
RUT = 762

Bought 705/710 put spread. Finally.

2:46 pm Took a break to work on a video and I come back to RUT down 8 @ 757. And this is the reason that I seldom roll up put spreads.

2:54 pm
Rude awakening. I bought only ONE (not all 10) of the 720/725P spreads at 5 cents. But looking to exit this condor. Am bidding 15 cents for each leg separately – That is trade #3 for May 21.

Also bidding 25 cents (have been for hours) for the 780/785C spread

3:00 pm
Oops. Bot remaining 9 put spreads at $0.15 and the 22 cent offer for the call spreads disappeared. This is the risk in taking legs. I woulds not usually pay 15 cents to exit. I did not bid for the whole condor because I could see an unfilled 50-cent bid, so there was no point in bidding 35 cents.

Update May 23

8:20 am, before the opening
Bidding to exit call spreads:

$0.05 for the 785/790

$0.10 for the 780/785 9:20 AM Filled by raising bid to 15 cents.

$0.15 for the 775/780 (I do not really believe I will get this one at this price, but one never knows)

The 740/745 put spread is the only one remaining (it is the result of a ‘roll up’) from the three condor trades.

11:44 am
RUT = 750
a) Rolled put spread 5-points lower. I bought the 735/740/745 butterfly (call)spread, paying 55 cents.

b) To prevent the whipsaw, I raised my bid 5 cents and covered the 775/780C spread @ 20 cents.

Now short the 735/740P spread and still have a net credit of 70 cents (not counting commissions)

2:39 pm
RUT = 764
Covered remaining call spread at 10 cents
Will get the puts today. Bidding 20 cents right now.

2:49pm
RUT 765+
Paid 25 cents – just for safety. Still earned 35 cents on this trade. Amazing.

Another good week for weekly iron condors. Two good gains and one smallish profit.


May 3, 2012

It’s Thursday and the new 8-day options will be listed for trading today.

As a reminder, I recommend letting the weekend go and not opening new positions until Monday or Tuesday morning. The strategy calls for exiting all trades no later than Thursday afternoon. This is short-term trading and can be directional (sell a credit spread) or market neutral (sell call and put credit spreads; the iron condor).

Buying options is viable as a positive gamma market play, but I do not recommend that idea for anyone.



Trades for May 14, 2012

1) Not a real trade with real money: CTM Weeklys

8:38. Not getting updated RUT prices. I do not know whether the deltas are reliable.

Collected between 1.65 and 1.70 for this CTM

    760/765P; 805/810C

    Put delta 21
    Call delta 19

2) Real trade: RUT options

8:34 RUT 790.
Collected 80 cents for 3-lots and 75 cents for 7 lots.

    RUT May 745/750P; 810/815C
    Sold 12-13 delta options.

3) RUT options

Opened another trade (another account) with a bearish bias

    8:52 am
    RUT = 782

    Correction: 740/745P; 805/810C

    Put delta 10
    Call delta 14

    85 cent credit

4) VCTM RUT iron condor

    9:04 am
    RUT 781
    33-34 delta 765/770P; 790/795C

    credit: $3.05 est [I did not make this trade with real money]

Update May 15

All is going well @ 8:47 am

Bidding 5 cents to cover RUT 810/815 Call spread
Bidding 30 cents to cover RUT 740/745; 805/810 IC. This is a low bid for now. May push to 0.35 this afternoon

CTM and VCTM ok for now. The real decision is whether to exit today.

Update May 16

I had planned to exit the CTM (Trade #1) and VCTM (Trade #4) yesterday, but as sometimes happens I was distracted and was away from the computer. I’ll enter an order to exit, and will take advantage of passage of one extra day.

Bidding 15 cents for trade #2. Changed my mind at 8:19 am. For the opening, am bidding 5 cents for each spread. I expect to get filled on the calls. If that happens I may raise put bid to 10 cents.

Bidding 15 cents for trade #3

Update: 8:32 am. Not filled on the calls. In fact, there was a 10-cent bid (it was filled). Being patient for now.

Update: 8:34. RUT = 781
I would bid 50 cents for CTM iron condor (#1)

VCTM: This is just a matter of being satisfied with the profits – considering the risk taken. I don’t know what I would bid because I would not be comfortable owning this trade. My sense is that $2.00 is a decent bid.

Update: 9:25; RUT =783
#2 Regarding the main trade (from my perspective), the short options carry a 4 delta. We cannot ask for better than that at this stage. Thus the decision is ‘how much to pay to exit.’ I’d be happy to pay 15 cents – just to prevent holding overnight. Thus, I will cancel the 5-cent bids and enter a 15-cent bid for the whole iron condor.

#3 Deltas are 4 and 7. This also feels quite ‘safe’ for the moment. The calls are nearly 3% OTM, and I can live with that. Thus, leaving my 15 cent bid in place.

#1,#4. Again, this is a personal exit decision. How much do you want to earn> I have no advice other than reminding everyone that we have a nice profit. We can go for the big win by holding longer, or we can take our decent profits. Reminder: These trades are illustrative and I am not following them as closely as I would under the Track that Trade banner.

Update 11:22 am. RUT =780

#2. Bot call spread at 5 cents (yes, changed mind again). Bidding 10 cents to cover put spread.

#1. I see zero chance of exiting at 50 cents. Either bid more or hold overnight. I would bid more if this were a real trade.

#4. $2 bid has a chance. If this were my real trade, I’d maintain this bid.

#3. Will probably have to bid 20 cents, but I can wait another 3 hours

update: 2:19 pm.

CORRECTION: This is #4 assume we were able to pay $2.00 to exit. That price was 10 cents worse than midpoint. Profit ~$1.05

update: 2:41 RUT = 773

#2. Bidding 15 cents for puts. It’s time to pay as high as you are willing to go.
#3. Bidding 5 cents for call spread and 10 cents for put spread

update 3:04.
#3 Paid 10 cents for puts.

May 17

8:38. The market has been moving lower as I write this. RUT = 771. Shorts are 6 points OTM

Looking at CTM trade, #1. The calls can be closed at 5 cents. We can bid about 90 cents now, or wait till later to try for a better price. As far as I am concerned, this trade is over. I have nothing more to say and holding depends on how the trader feels about being naked short the put spread for the next several hours.

Clarification: At this point we no longer have an ‘iron condor’ position. The call spread is no longer a hedge. Thus, there is no ‘strategy’ left for us to trade. The decision to exit depends on how much risk the trade is willing to take. If were me, I be bidding to get out – but that is because the downside worries me.

I assume no one will hold this until tomorrow’s morning settlement.

8:51. RUT = 768.

Trade #2 is in jeopardy. I am going to get out – just for the safety of doing so. I own this trade and want to take my gains and quit.

8:53 RUT = 768.

Paid 25 cents.

Doing this with four different trades is difficult. I hope I did not confuse anyone with my mixing up # 1 and #4 yesterday.

ADDENDUM: 8:57. #3. Bot the 805 calls at 5 cents. Offering the 810s at 5 cents. Filled. Bot this spread at zero (plus commissions).

Result: All trades were profitable.

The question is: Did we learn anything from these positions?
More later.



Trades for May 7, 2012

8:32 am: Collected $1.95 for RUT 750/760P; 810/820C iron condor. HALF SIZE because it is 10-points wide

8:50 am: Collected (only) $0.70 for SPX 1325/1330P/ 1400/1405C iron condor.

May 8

Bidding to close whole iron condor, but do not expect to be filled:
25 cents for RUT and
55 cents for SPX

May 9

Bot SPX call spread at 5 cents. For the moment, bidding (a very optimistic) $0.20 for puts.

Thinking about exiting RUT spread because of decent profits. Not yet because delta of short only 12 at 9:21 with RUT = 783. Have been bidding 5 cents for call spread since the market opened.

9:25 am. OK, getting nervous about profits. Bidding 80 cents to exit whole RUT iron condor. Why? because SPX put delta reached 30 and I do not want to suffer a debacle. Raised bid to 85 cents.

9:37.Bid only 80 cents. RUT 783.
9:43. 784. Bidding 70 cents. That’s it. I want to buy this back. No lower.
10:11 am.786. Cancelled combo order. Paid 55 cents for puts. Thought I could easily get calls. WRONG! Bidding 20 cents and feel foolish.
10:13am. 787. Being cautions, I paid 25 cents. That’s a total of 80 cents.

Nice gain ($1.15), but not the best trading technique today.

Raised put bid on SPX to 25 cents. Still away from the market, but I hope to exit later.

May 10

Bidding 15 cents on the opening. According to futures, SPX will open near 1360.

Filled at 15 cents, paying 20 cents for the whole iron condor.
Another decent gain.

8:32am It pays to be lucky – but ‘luck’ is not always the good kind.



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