A Trade

Discussion in 'Options' started by donnap, Aug 20, 2014.

  1. donnap

    donnap

    It's like watching paint dry. That line from Robin William's golf bit, "not even a German geneticist could have come up with that one," has still got me chuckling.
     
    #51     Aug 27, 2014
  2. convexx

    convexx

    Yeah, best to spread here. I wouldn't want to short vol naked into a $3 range in SPX.
     
    #52     Aug 27, 2014
  3. donnap

    donnap

    My thoughts exactly (I think?) I wouldn't mind just putting it back into the approx. shape it was in. I'll wait.
     
    #53     Aug 27, 2014
  4. donnap

    donnap

    Bought back aug ES 2000C at 2.90
     
    #54     Aug 27, 2014
  5. donnap

    donnap

    Buy back SPY shares at 200.07
     
    #55     Aug 27, 2014
  6. donnap

    donnap

    Buy back SPY puts at .61. Right back where we started from.
     
    #56     Aug 27, 2014
  7. donnap

    donnap

    You summed up the entire trade nicely there. I've been trying to do that from the start. Could have gone with a BWB any old time, but was trying to regain an advantage.

    But my efficiency here has sucked. Too many trades. Using the BWB earlier, even at a disadvantage may have saved on costs. I want some delta to work with, anyways, possibly to add size.

    I've been thinking about diag. backspreads and that seems like a decent structure to start with in this environment.
     
    #57     Aug 27, 2014
  8. convexx

    convexx

    Well, you won't see a decent return if correct. Asym flies are good risks if made path-dependent and var doesn't stretch. You can easily earn more on convergence (modeled PNL path from inception to expiration) than you lose on vola, even if realized-vol is more than expected. I have to generalize, but there are positions that are indeed best-practice.

    If you don't like the wing-risk then trade narrower and smaller size.
     
    #58     Aug 27, 2014
  9. donnap

    donnap

    Thanks for the input. Much respect. Part of the fun of reading your posts is trying to figure out, What'chu talkin' 'bout, Willis. But you've always been generous about explaining stuff, IMO.

    I have an atticus story I should share sometime soon. This thread is way longer than I expected and belongs as a journal. I'll try to finish up the trade and perhaps start one. Can I hear a collective Amen to that.
     
    Last edited: Aug 28, 2014
    #59     Aug 27, 2014
  10. donnap

    donnap

    I like the long side, soon.
     
    #60     Aug 28, 2014