SPX Credit Spread Trader

Not that it is the only thing I look at but I always check where 2 sigma lies at the time I am putting on a spread. With higher volatility it pushes this point farther from the market.

 

Coach,

Will you or John Sebastian be doing the radio show this week. Clue please on this weeks show. Thanks...your listener that makes your show coast to coast.......waiting for border to border.

 

Good point, it has been a while since I have brought it up but 2 sigma is a good rule of thumb for guidance in selecting strikes for spreads. As vols increase so does 2 sigma distance.

For a quickie estimate, take the ATM straddle on SPX and double it for a 2 sigma range.

 

LOL well this monday I think I will do put ratio spreads and some other strategy for discussion, alone though .

July will also be my last month for the radio show. Trading full-time, the little trader and the fact that getting sponsorship has been tough and it is hard to demonstrate options on the air made me decide to cut it at the end of the month. It is fun, but it aint free. I am also lecturing at George Washington University to the MBA and MSF classes on options and technical analysis and writing for Option Trader mag so the plate is getting quite full lol. I would rather devote the extra outside time here on this thread .

 

Ryan:

Please refresh my memory on how to check this in ToS.

Thanks.

 

Just go to the Probability Analysis tab (under the graph) on the Analyze page. In the upper right hand corner you can change the percentage to 95% for the 2 sigma values and the graph will update.

 

Hi Coach, rally or anyone,

This question may have surfaced in the past but dont remember seeing it. I noticed that I can get a higher credit on SPX than on ES spreads. Why would you want to trade ES when you can get better credit on SPX?

eg

ES ~ 1281

1315/1325 spread 0.55 mid


SPX ~ 1273

1305/1315 spread 0.78 mid

These are based on IB quotes but I haven't compared whether I can get better midpoints on ES or SPX.

Is the better credit on SPX because of SET?

Thanks

 

nope..remember ES is 1/2 the value of spx so double your .55 and your actually getting a better spread

 

Let's see how much you guys have learned from this Journal

Why is the market up since Friday....

 

Coach bought put hedge!:eek: