it was a roll-up, look at the first post, he now has a dia feb/jan puts at 136/137 strikes. bought the initial at about .80, sold it for about 1.00 and paid about 1.00 for the current position. i think i got that right.
My apologies for the shoot from the hip post. BTW, I recommended this thread in a PM about managing diags.
You've got it traderlux. My philosophy is that whenever you can roll to a better position for a credit, you're doing something right. lol Josh
This is an update for those who have followed the progress of the diagonal spread strategy I first posted in December. I initiated the strategy by entering a 5 contract diagonal spread in the GLD Feb/Jan put strikes at the Dec expiry, buying the 134's and selling the 135's for a debit of 0.80. The total margin required for the trade was $900. GLD moved sharply higher in just a few days and I closed the position on Dec 29th for a credit of 1.02, netting a 0.22 credit ($80, after deducting brokerage commissions). On that same day I entered a new 5 contract Feb/Jan spread at the 136/137 strikes for a debit of 1.04. GLD subsequently sold off and, when I felt that near term support had been reached, I added 5 more contracts at the same strikes for a debit of 0.65 on Jan 5th. I added another 10 contracts on Jan 12th, again at the same strikes, for a debit of 0.68. Summing up then, I currently have a total of 20 contracts at an average debit of 0.7625 ($3,525 total margin required). As of the close on Jan 12th, the MTM value of the position is $3,720, so the strategy is coming along nicely. Importantly, with only 7 trading days remaining in the Jan options cycle, there is about 60 cents left of time value in the Jan strikes, all of which will go away by Friday a week. Thus, a good ROI looms on the horizon. For those interested in how I wind this position up, the exit trades will be posted at blog.wastingassets.net as well as on the results page at wastingassets.net. Cheers