Hi all, sorry for the previous long post list. I was out of town and only had a chance to peek at my positions and no time to even check the blog. I will read all of the post to see if I need to answer any questions.
Hopefully all made some money in this market. It certainly was an up and down roller coaster. All of my positions ended ok with all expiring today.
I want to remind all to be careful and leave lots of cushion for this crazy market. Stocks like PCLN (which I had over 100 positions) need plenty of extra cushion. I see one day it was up 28 pts...wow. AAPL has been a pretty good source of money (free) for the last few weeks. But don't get careless. I have not had time to look forward to the coming week. Maybe some of you posted new ideas? If so I will check them out to see if they fit my style. The last week I avoided any of the SPX OR SPY trades. Maybe they will fit nest week. Again this week I will look to start opening positions on Monday - Tuesday or better yet Wednesday, The more cushion and less time the better in this market.
Be careful with your picks as earning season is coming fast.
Jerry
76 comments:
Is anyone concerned about the Greek votenext week? I'm holding some Spx spreads and think of buying back on Monday. Yes I have cushion but who really knows what will happen. Only bought them for some time decay.
Chris
Hi all! I know I've asked before and I'm actually getting quite good at it. But, BID and MID on SPX.
I'm looking at doing my first SPX trade this coming week. Since it is my first I'm going conservative.
I'm looking at the 1185/1190 put. Here is my question:
Bid is a debit at .40
MID is a credit at .35
What would you guys put down as your credit limit to get filled?
I'm thinking .10 to .12 will get filled.
Thanks!
DR3Z!
Hi Doc, I am also looking at the SPX but different than you I am looking at the 1150/1125 that is a 25Pt spread but if I can get.25 it will be a 1% with 118 pt of cush.. Maybe the 1175/1150 also a 25 pt spread but I might get .3 for a little over 1%. As you can see I look for cush before return.
also some ideas for next week for me..and I only open them tomorrow if the market is going in the correct direction. If not I will wait until Tuesday- Wed etc.
aapl @ 325 290/285 350-355 IC
nflx 220/215 290/295 ic
goog 510/515
gs 115/110
I like to do my IC's (iron condor) by legging in. Otherwise if you can only get filled on one side it does not hold up the whole position. Also someone asked abut where to pick a price when opening. I usually go far enough away that either .05 or .04 is about all I can get. If I can get .10 to me it is an alarm bell telling me that I am getting a little to close. Just me, but safety is the most important part of a trade.
Jerry (good to be back)
Jerry! Jerry! Jerry!LOL...Glad to see you back on here, you really need to get internet access on your phone! :P lol. j/k!
Hi Jerry, I know your win % is extremely high but if you get .04 aren't you left with only ~.02 after commission? With TK I find it comes to about 2 cents for a spread. Maybe the answer is volume so you're still netting .035 out of .04? Tks!
Hi Glenn, yes the commish does eat into profits, but just part of the cost of doing business. I try to do volume of 50 in each spread or with regular puts. The average cost is .014 per option. So yes, starting with .05 nets around .035 One problem is that most stocks trade in .05 increments. So the next step is asking for a dime and net .085 ish. Sounds good and I do get that at times. But I try to avoid the temptation of risking my capital for a few cents more.
Jerry
There are 2 features that I prefer to have but not available in TOS platform. Given we trade far OTM puts or calls I believe these are essential!
1. AON (All or None option).
2. Last sale date and timestamp at each strike price.
#2 above is available in cboe website with a 15 min delay. But we have to go into every strike to find out the time.
Not sure if these are available at other brokers.
@kris
1&2 are available at TDA platform. Plus FOK(fill or kill) order.
Since TDA clients have access to TOS platform, I use one or the other.
hi jerry,i was wondering how was the trading after october 2008.i was looking at stock prices and they did drop by 10 to 15 percent per month.Was it easy to find many options returning 4% per month with 20% cushion.Nowadays its hard to find any options with 4 percent return unless u drop the cushion to less than 20%.thanks
Anyone trading SPX this week? There's going to be a storm of economic data hitting us all week.
I have spx ic's 1195/1200/1310/1315 for the week which I bought on Thursday and Friday. Also looking at some GOOG and PCLN call spreads and may dabble in a couple others.
Chris
I'm currently short (naked) the following SPX puts:
1050 - quarterlys @ .20
1075 - quarterlys @ .15
1100 - weeklys @ .25, .30, .35
Normally, I BTC these positions (I established on Thur-Fri) on Mon or Tues for .05. This week I think I'm just going to let them expire worthless (first time I will have done that, we'll see, don't know for sure yet). I'm looking to do my normal (so far ace-in-the-hole) .10 trade on SPX twice this week. STO .10 options on Wed. that expire on Thurs. (quarterlys), and STO .10 options on Thurs. that expire on Fri. for the normal weeklys. BTW, the quarterlys expire PM on Thursday.
Henry, I'm not seeing this week as a big week for economic data, what are you seeing out there? Maybe I'm missing something. The Greek austerity issue, I think, comes into play tomorrow, jobless claims on Thursday (the BIG jobs report is next Friday-7/8), ISM is on Friday and that is about it for this week, for what I see of the major stuff. Friday will probably be trading on light volume, so it will be easier to whip the market up or down because of that. The debt ceiling issue is still out there and needs to be watched as they have till 08/02 to vote on raising it or not.
seems like US has a lot of economic reports come out from time to time.
Is there a place where we can find the calendar of all these reports?
Ying, I like to use the following:
http://mam.econoday.com/
* Red stars are the big ones
http://briefing.com/investor/
* Move your mouse pointer over "Calendars" and select "Economic"
Thanks Dave!
@Dave G, thanks for the calendar data, it will come in handy.
@All, I have been thinking about waiting to open some positions on Thursday just to try it out. I would have to break my rule to come closer to the stock price BUT I would only need enough cushion for 2 days of trading.
ok ok wait, hold the phones, I just looked up the Jun5 11 Quarterly for the SPX and found a position with 102.54 points of cushion for this week. I put an order in and will let you know if it goes through.
I am going to start looking at positions for Thursday and Friday like you all are talking about. I think you can get more cushion with regards to per day then you can if you were to open a position on Monday, for the same return. I will let you all know.
@dave:
What ying said haha. And I use money.cnn.com for my news updates.
Opened some SPX put spreads.
1200/1190, and 1205/1200
We'll see how this monster moves this week.
Didn't get filled on that 102 point position. I opened some SPX weekly spread for the 1185 / 1180. 94 points of cushion for 4.5 days (today is half over). Premium was .10
I think I will open up some positions or look for some on Thursday to see if I can get 50 points of cushion for 2 days of trading for the weekly
Tried a 5 cent fill on quarterlys 1175/1170. It has been sitting there for hours without a fill! I prefer the quarterlys to get margin funds released on Friday. will have to check other strikes or weeklys now.
I feel more liquidity in weekly than quarterly. Not easy to get filled with quarterly.
@avid_kris, Ya I tried the quarterly too but it did not get filled, so i moved to the weekly which DID.
ok. Thanks. I have put an order for 1180/1175 weeklys now at .10. Let me see if it goes through.
@avid_kris you can get filled at .10 on the 1175/1170. more cushion same money.
SPX traders, reference the following video where Doc Severson, from OptionsMD, talks (briefly) about the benefit of trading the SPX during times of higher volatility.
http://www.youtube.com/watch?v=WtoyH09HU1I
I tried various strikes. Got a fill on weekly 10 puts @1175/1150 at 20 cents.
I added more SPX put spreads this afternoon.
So I have following positions now
(all are weeklys)
1. 1175/1190 @.20
2. 1200/1205 @.15
3. 1190/1200 @.15
Hope all are expiring worthless!!!
FYI, it was mentioned on Fast Money, just a little bit ago, that the Greek vote on their austerity package will be on Wednesday.
Got SPX IC fills at .25, .20, and .15 today
1205/1210/1335/1340. The call side was only worth .05 each time. Maybe zero at the last fill. Incredible, considering the Cush on put vs call side.
@Rick,
That's why I seldom do IC. I don't want to risk for small profit of call side compared to relatively large profit of put side. you're braver than I am!
Kenny
You have a point. I'm just a sucker for the "free" spin. No additional margin required. So for 100c it cost me $15 to collect $500. The second spread on an IC is free money, albeit at some risk.
If I used all my margin on put spreads. That's ok, but for .015 per contract, I can sometimes increase ROI by 10-100%. I'm a premium whore ;-)
Rick
Rick, a few questions for you:
1. In your 1205/1210/1335/1340 IC fills, did you do 100 contracts for each of those fills (.25, .20, .15) for a total of 300 contracts for all three?
2. You’re paying .15/contract...right? Do you also pay a ticket price?
3. What is your exit strategy should price action threaten one of the legs of your IC?
It appears, Rick, you're certainly working this market with lots of success and profits.
@ Dave G,
My three orders were 200c, 100c, 50c (x4 legs ea.). If the market moves against me, I a)roll up/down/out b)close, or c) hold on tight and pray. "C" has worked best :-)
Yes, .15/c and there is an $8.95 base fee on each order, but only ONE, regardless of the number of legs (1-4).
Again, I like IC's for the 'free' second use of the same margin requirement. i.e. the margin required is the same for one spread, or if I add a 2nd spread (ie IC). This effectively doubles my ROI. Like Jerry, sometimes I add the second spread later.
Cheers!!
rick
@Rick
When I tried to add a second spread later to 'create' an IC my broker seemed to required a second maintenance. Does this sound right? do you have to establish both legs simultaneously in order to get the break on the maintenance? Maybe I just didn't have something right.
@safesimple - I don't think you have to do it simultaneously to avoid maintenance. But you have to do it for the same weekly or expiration date as the original one.
Hi all, safe’n’s. normally you do not have to open them at the same time. Some brokerages might require it but a phone call alerting them that it is becoming an IC should clear it up?
I have started some positions so far.
GS 115/120
SPX 1195/1200 - 1200/1205 - 1230/1235
AAPL 305/310
Tomorrow I will turn them into IC's if the mkt is cooperating.
good luck all and start watching for earnings season. That is another advantage of weeklys. Normally if my stock reported during the month, i avoided that one. But now you can still get 2 or 3 weeks of plays with that stock.
Good luck all
Jerry
Thanks Rick!
@Jerry, What premiums did you receive for the SPX spreads?
Yes I am thinking about opening mine up to an IC on Thurs or Friday for the extra crumbs
The one I will watch for, is for earnings for EXXON. They are big in the SPX and if they drop it could ripple into the SPX. By how much i am not sure as i have not traded SPX while Exxon had
earnings.
Big Player on the S&P, these earnings could affect the S&P during earnings season
Exxon Mobil Corp. 3.81% Energy
USA General Electric 3.15% Industrials
USA AT&T Inc. 1.92% Telecomm
@Safensimple,
As reported, you do NOT have to enter both spreads as one order. In fact, as Jerry has pointed out, sometimes it is advantageous to open one side (put OR call spread) and see how the market moves so your 2nd spread can be entered closer or farther away than had you entered at once.
I 'discovered' the margin maintenance requirement quite by accident. I already had a put spread, and decided add a call spread the next day, and the margin requirement said $0. I thought it was an error, but realized it was an IC, and only one side is at risk, thus only one margin requirement. Coll eh?!?!?!? Call your broker, and they will fix the margin issue.
Good luck!!
rick
Jerry,
The first legs of your SPX IC's look fantastic. With SPX up 20+ last two days, I sure with I had waited on the Call side of the IC. I know better, expecially opening up the trade on Monday. I still have 55pts cush on the upside. I'm probably OK, but I could have gotten a better premium with 50pts cush on Thursday...
- Work in Progress -
rick
Cool is right. Thanks all, I'll call 'em.
@Bald, you are reading my mind, this week will be the first time I will be adding to my SPX put spread making it an IC on thurs or fri. I find that on Monday they just don't give you enough room for cushion for the premium you recieve. I went 90 points on the put side with a .10 prem and with only 50 points on the call side was .05 prem.
If i wait until thurs or fri i can get 30-40 points of cushion for the .05 i think. We will see, but i definetly think this is the best play to make when playing the SPX. open up a put on monday if you think the cushion and return is good and wait for the call side till Wed, Thurs, or even Fri to get that little extra crumb.
SPX up 12.30 today. go as high as you want SPX haha, i got the put side. over 105 points of cushion right now haha.
Rick, how do you feel with your call side of 1335/1340? The chain after that is in increments of 10 with maybe a measly .05 premium (0.5%) before commissions.
@Fulgore
There is one more play we can try with SPX this week. "Roll up". I can roll up my put spreads more higher so that it can generate another $$$. I'll see tomorrow if I can do that.
@Kenny, not sure about my rolling up. I think the commissions would kill me. I will try it and see what my TOS says the cost will be. Also I do like knowing that basically i get to keep my money 100% this week. I don't want to get in the greedy factor. As Jerry stated many times most of his losses are from rolling up to soon.
Let me know if you see any good rolls though.
@All Using TOS, Anyone ever do a create rolling order?
So I highlighted my current positions for the spread
right click the blue dot on the left of the positions
choose creating rolling order for the spread
menu comes up for 4 positions. I am unsure what this is. Is the top 2 my current position and the bottom 2 what im rolling to?
Fulgore, I have never "rolled" using the TOS platform, always have done it using the app on my phone. Simple and easy and you get to pick what spread. What a market! I'll be rolling as well if the markets don't turn. Only good part is that I don't have alot of spx spreads.
Chris
HI traders, Fulgore, for most I received .05 but I did get .10 for the 1230/1235 and I have done some 1235/1240 for .10 Generally I try for .05 as I have said, it is a way for me to know that at .10 I'm getting a little to close to the current stock price. These SPX are for Thursday so only two days to go. Same old preaching from Jerry, but do be careful. These coming weeks have budget talks for the U.S. and there is Greece and stocks starting to report earnings. Settle for less ROI, control the time factor and pick your positions carefully. You will make money and sleep better.
Jerry
Fulgore,
I like the modification of adding the call leg of the IC later in the week. 30 to 40 points for 1 or 2 days sounds a lot better than 50 points for 4 days and the same .05.
Plus no comission and you were going to ride the put to expiration anyway at that point.
George
Is SPX closing on Thursday this week? I thought that was only when it coincided with the monthlies?
Nic, the June quarterlys (which became weeklys last week) expire tomorrow (Thursday PM). The normal weeklys for this week (expiring this Friday PM) are also in play. And, starting tomorrow morning, next week’s weeklys (expiring Friday 7/8) will also be in play. So, in essence, tomorrow (and for tomorrow only) we will have 3 sets of SPX weeklys in play--the quarterlys that expire that day (PM), this week's weeklys that expire 7/1, and the new weeklys that expire 7/8.
Good morning.
@Dave G
Add on one more set for spx - the monthly set July 16 has been there some time.
Have been extra cautious. Like this article & share the same sentiment as the author:
http://www.marketwatch.com/story/the-most-important-juncture-in-market-history-2011-06-28?link=MW_popular
US - reverse course or dig harder & deeper.
@ Kiteman, yes adding the call leg later on is nice, i will have to try it out this week.
@All thanks for the rolling info, i will just rolling to .05 and see what happends.
Is it just me or does it seem that we're getting a little greedy by using iron condors? I thought we were happy with around 1% ROI per week. I've use IC in the pass and the returns are great, not going to lie haha.
Hi guys. I didn't understand the advantage of iron condor until I read your comments above! It really can boost up my ROI per week a lot!
It's so good to be here to learn money making technique from smart traders like you all :)
I have had 1195/1190 and 1230/1225 position. I am looking to add 1335/1340 to make it as IC w/o additional maintenance :). I think I'll wait until tomorrow, not confident to do it today, market is going up strong.
Hi all, a lot of traders doing SPX. Make sure when doing SPX for this week, which ones you have. There are June 30 and July 1st. As mentioned the advantage of the June 30 is they expire so that the maint can be used on Friday.. Plus a sooner expiration time(less exposure time).
@Jerry, Thanks for the heads up. I thot, lets see what chain i'm on and sure enough it was the July 1. So many little details to trip you up. Thank goodness for this board! It would take me years to figure all this stuff out. Guess Jerry in your case it has, lol.
@All, ok so I checked into the vertical roll. Unfortunately it will cost me to much commissions to roll for 0.05, i will end up losing money haha. So I will keep my 1185 for now.
My commissions to trade 10 vertical contracts is 39.95 ouch. So if i used say $40 to get out of my current position and $40 to get in to the next one that is $80.
so prem is 0.5 X 100 = $50 for the trade
$50-$80 = -$30
I would have to get .10 prem for me to think about moving. Even with .10 the return is only $20 to roll up which I don't think is worth it because i would have to go to around 1250 on the SPX.
Someone smack me if I'm way off!!!
@All, my trades are currently JUL 1 trades and so i will have to wait till Friday PM for my maintenance.
@Ying, I am also eyeing up the SPX 1335 / 1340 to make an IC to my current vertical put. I will wait a bit though, maybe even tomorrow morning to see how it turns because 29 points of cushion scares me with 1.5 days to go.
I am sure it is safe because SPX has been up all week BUT you never know. Safety over greed, safety over greed, everyone say it with me haha.
FYI, from the traders almanac in regards to tomorrow & Fri:
THURSDAY:Last day of Q2 bearish for Dow, down 14 of last 19, but bullish for Nasdaq, up 12 of 18, although down 6 of last 7.
FRIDAY: First trading day in July, Dow up 18 of last 21
TUESDAY 7/5: Market subject to elevated volatility after July 4th.
Thanks Ed - Funny that I am going to get the book...
Henry,
I have been trading iron condors for a while. The way I look at iron condors (IC) is two separate trades in one. Yes, you can do an IC all in one trade but if you are like me you leg in to an IC. I will open one spread and then depending on market direction I will open the other side later in the week. This is two separate trades and two separate ROIs, even though you only maintainence is put up once. It all depends how you trade and how you look at the maintainence.
Chris
Cautionary tale: I'm sure most of you experienced traders on this board have thot about/run into this but maybe there are some other novices like me who have not. With all this talk of maintenance free legging into an IC, I ended up with a GOOG505 (never should have been there anyway) on the call leg that was making me nervous. I had already pretty much maxed out my maintenance for the week when I got very nervous about the GOOG and tried to liquidate position at market.'Not enough cash in account to settle' says the broker. Selling this leg does not free up mainentance. Was finally able to wiggle out sideways using remaining maintenance and a limit order. And of course as soon as I did, GOOG stopped going up but I'm still glad I'm out. Be careful out there.
@gssound,
You make a good point. I'm going to practice paper trading using the IC strategy to get a feel for how it works. Thanks!
@Safensimple - Good point. I have thought about this too.
Wouldn't this apply to even normal orders, not necessarily just ICs?
Let us say if I have 10K in my account and I have used all of it for a spread already. Now if I have to buy back the spread are we supposed to have liquid cash available in the account other than the cash that will be received after liquidating the spread?
Rollin, Rollin, Rollin, Rawhide!!
Sorry, I could not help myself. If you are too young to understand, so am I, I just saw the last 2-3 episodes when I was a kid...
Rolling your spreads - some of you guys have PUT spreads that are SOOO conservative (150pts), you could actually roll TOWARDS the current price and make another .10-.15 this week.
ex: Roll the 1175/1170 (~.10) all the way to 1235/1230 (~.25)for an extra .15 cents!!! with 72pts cush!!!
How do you guys sleep with 150pts cushion??? LOL!!!
btw Gssound - are you still holding the 1310/1315 call? Now, that is living on the edge. I thought all my SPX calls were 1335/1340, but I have one at TK that is 1325/1330, and I'm man enuf to admit I screwed up.
I could have closed out today for a 10k loss. I tried to roll to 1340/1350, but I don't have the extra margin for the 10pt spread. I'm gonna pull the trigger about 10am tomorrow and wire funds as needed. Then I can roll to 1335/40 or 1340/50. Or close out, hopefully before it goes any higher.
My word verification is schiesh. Incorrect spelling, but it is my sentiments exactly.
rick
Rick,
I had 1150/1125 expiring tomorrow (Thursday) with 20% cash on the sideline. Yes about 160 points margin lol. The other one was 1150/1175. I was looking and looking at spx...nothing worthwhile (that is safe enough for me)this week. There is 5 cents left with $1335/40 or 1240/50 and I have to cover 1125/50 with 5 cents left on the table, and I'll end up with negative cash flow with rolling up. Don't get me wrong - I got about 1% week last 2 weeks.
Rolling up or down or closing IC so far has not worked for me...
Rick,
Yes I did have the 1310/1315 spread. Heck I didn't think the market would rage like this! I was able to roll out of it today. I was so fortunate on a couple of Visa spreads. Crashed and burned on those.
Chris
Correction, I was not so fortunate on a couple Visa spreads.
Chris
I love using ICs for the usual doubling they give for ROI, but the problem is that they so fundamentally change the simple psychology of this game that sometimes I feel just like swearing them off. There is just something so nice and clean about having a one-way vertical spread where you can just *not care* when the market goes in your one direction as much as it wants. Somehow I think that the doubling of money generates MORE than doubles the worry; perhaps it is some kind of inverse square law, and the worry gets quadrupled? OK, obviously just making stuff up, but I know that my anxiety is greatly increased having to watch two ends. (That being said I still have one of them out there now heh.....can't quite give em up just yet...)
@avid kris Don't know the answer to that. Maybe somebody else on this board can answer. Please.
@Gremjun. Well said, I'm trying again a little this week to see about the 'anxiety' level. It sometimes seems we take a simple thing and make it difficult. I'll report in on mental health Fri afternoon!
ahh good ole Friday afternoon. That dearest of times where we finally know whether the weekend will entail drinks of celebration, or drinks of commiseration! (of course things are more complicated than that if you are involved in monthlies lol.....)
Post a Comment