Donna, I felt so bored this morning that I decided to jump in your trade with you. I am sitting on 100% cash. So I decided to do 10 SPX 1340/1350 @1.50 or 15%. I am testing the water and next week I will see If I can get a little bit more premium. I shouldn't be at less than 1350 but I used just a little of my capital. We shall see
I dont see why you guys like the oex so much. I agree with what momoney said about the existence of a very small window where it makes any sense to go that route over the SPX spread. Due to a better strike availability of the SPX options the majority of the times you can pick exactly what you are looking for at the credit you are seeking whether you wanna go ATM, OTM or FOTM. I dont see that with the oex.
To balance that suggestion, I personally could not advocate putting on an IC 2 or 3 days before expiration. The risk/reward is not attractive - likely to be in the region 20:1 or worse. It is a pure binary bet with very low reward and not even great probabilities to compensate. One only needs to look back to Jan '06 expiration to witness a 10 point drop in the XEO/OEX on expiration day. Whatever makes you money though! MoMoney.
If you play at the right time for the right premium, it's wort trying. OEX gets you faster fill than SPX. JMHO
just noticed in looking it up I can sell another 20contracts with no add BP needed..woo hoo...I'm trying for 1.20
Mo, The IC is placed Wednesday afternoon and it's a directional play and you are ready to get out at anytime of the tsrike that's being threated. 10% is not impossible in a trade like this.