Instead of being in a great mood with these grain and bond profits, I find myself in a bitter mood. I was unable by less than a cent on an additional 10 corn buys on Tuesday. That folks is turning into a 20k unable. Also I paid the high Wednesday for 10 bonds. I never got repositioned so there's another 13 g's not sitting in my account. It's IMPERATIVE that I not let this effect my trading to-morrow. Positions entering Monday: S 11 USM (ZB) L 7 Cotton L 10 Corn S 5 SK 780 puts
30mins to go. Good luck this week. You might want to ratio some short gamma against your spot position.
Thanks bro. On the Corn I'm all ears if mo slows to sell May calls and clip a nickel in premo. I'm going to be all about some backspreads as well. I need coaching on those. Bonds is probably the best place for some serious premo collection BUT as you'll see I'm infected as a perma-bear on Bonds and it's awfully hard for me to do anything that'll cut my -d's. One of my truths, and I think we can benefit from this, I believe this is the dawn of a new age in premium buying. Not blindly of course. We both know that ultimately most options trades have to involve selling liberal amounts of gamma. That's why they exist, eh? I just don't want to get foolish in the midst of what I think are going to be some freight trains. Another strat I like and that you know how to implement is the selling of OTM vertical put spreads as a means to pay for OTM calls in select commodities. Flip that shit the other direction in bonds and stocks. The concept of a less noisy "no action" zone is an awesome tool for the directional spec. July Corn provided an AWESOME opp last week. Something like selling 320p-300p vs. a buying SHITLOAD of $4 calls.
Yeah, I agree vol is cheap in a lot of futures, especially bonds. You\\\'re trading synthetic long calls and puts if you buy vol against your futures positions. Selling some gamma otm to lock some deltas at a decent vol. Of course you may be locked into the futures position if you\\\'re trading the options to lock deltas. I wouldn\\\'t go long premium to add deltas to your futures. IMO, pick one or the other. For spec, it\\\'s a good bet to stick to the atm options, especially in the gains. The bull skew is tough to overcome. Makes for a good sale to lock you position at favorable edge. The covered risk reversal: You pay for the defined risk in terms of the position debit, but it\'s a nice idea. PM or detail your corn position here.
At least there was some fisticuffs, lol. I'm long 10 July from 361 3/4 Are you saying OTM's in grains are pumped relative to the ATM's. Similar to the skew in OTM index puts?
Right, although the skew is much more pronounced. I don\'t have the quotes for corn options here, but I recall a 2000bp vol-premium on the 20d vs. 50d options last year this time for the front month. Upside skew.
My vols are flashing \"NA\" but the 30d outside risk-reversal is trading 4.00 call over put. That\'s nice, but nothing like last year.