Wow, you are incredible dude - not only are you one of the greatest calendar traders on the earth (haha), but you can also magically read my mind from across the Atlantic and figure out what my rational for the trade was. And.....and.....simultaneously, you can talk complex bollox without limitation. Wow, we are truly blessed. What vol-switch argument? Who said anything about vol-switch? You did. And only you. I've never mentioned that in any of my posts. I care less about the vol-switch than I do about what opinion you have of other peoples trades.
You're lying to yourself. That's exactly why you bought the calendar. The vol-switch is the voldiff between two x-series (tenors) and not the y-series (vertical/strips). It's your argument.
You see....to normal people, this reads like.... "Regarding.....blah blah blah.......mark". You buy a calendar at an edge of say three handles (b23 x s26) That's a diagonal you fool, not a calendar.
I am not referring to a strike. Those are vols."Edge of three handles." 26-23=3. We're discussing the vol-diff. It's implicitly a discussion of calendars which are same strike.
Do you actually just make up your own words, just cos you think you're special? vol-switch = just say "vol diff", FFS. strips - just say "vertical", like everyone else. I've long ago stopped even trying to decipher the nonsense you write. The juice is not worth the squeeze, as they say.
You have witnessed a homicide. Your nick was just murdered. You should take the deal and enter witness protection.
Before I leave this wonderful thread. The time fly was a better trade with long wings in the back and short body in the front. Much better gamma/dgamma position. Meaning, much greater return on the cash-requirement. This is what you want.
You are probably one of the best Hindsight traders in the world. Incredible! Pls tell me what other trades would have been great, with the benefit of being able to see what happened in the markets. Oh...let me see.....do you recommend that I should have bought long Puts in the SPX on Mon evening because the market fell -4.5% on Tue?! Please don't leave....oh please, Desty.....pls stay. I was really enjoying this repartee. Okay, go on then, go and waste someone else's time.
FDX calendars jumped for the same reason that market wide calendars jumped post CPI print. But FDX calendars actually reversed back to their levels on the 8th before hand so unless the market prices in an earnings move larger than the 7.1% earnings straddle relative value at the time of entry, the calendar relative value should continue its march upward. The trade would have made sense on the index from a vol standpoint only but you'd have lost on gamma in hindsight. With the generous IV of the earnings contracts coupled with the relative value reversal undoing several days of theta, the FDX calendars had more edge than the index equivalents.