Basically, your position is a long calendar spread or rather multiple calendar spreads at various strikes so the P/L profile as well as that of the Greeks is as expected. If you want a more useful comment you need to provide more details not only about the actual positions, but also about your thinking as HowardCohodas mentioned above.
I did what I did because that is what the course I purchased did. We started with index based ETFs because of liquidity and more consistent that a single stock. (I did a single stock LCC as an experiment.) I selected an entry price where the Delta was ~.25 and also looked at the EEM chart looking for trends lines, support levels and resistance levels. EMM looked like it was trending up with support at 48 and resistance around 50 so that is where I started. EEM - Double Calendar May 11: (-1) 48 Put, (-1) 50 Call, Jun 11: (+1) 48 Put, (+1) 50 Call As EEM moved up and approached my break-even on the up-side I added an adjustment. EEM - Double Calendar May 11: (-2) 49 Put, (-3) 51 Call, Jun 11: (+2) 49 Put, (+3) 51 Call I followed that same approach with my other positions. DIA - Iron Condor May 11: (+1) 118 Put, (-1) 199-Put, (-1) 127-Call, (+1) 128-Call SPY â Iron Condor May 11: (+1) 127 Put, (-1) 128-Put, (-1) 138-Call, (+1) 139-Call LCC â Double Calendar Jun 11: (-1) 8 Put, (-1) 10 Call, Sep 11: (+1) 8 Put, (+1) 10 Call If the market moves up or down and approaches my break-even points, I add positions to adjust the P/L graph. I made an adjustment to the LCC as the stock moved down. LCC â Double Calendar Jun 11: (-1) 7 Put, (-1) 9 Call, Sep 11: (+1) 7 Put, (+1) 9 Call I want to keep the Delta and Vega for the portfolio less than 100, which is currently at 45 and 12 respectively and of course a positive Theta which is at 3.07. Currently my market posture in neutral so the Long Spread positions match my sentiment and according to the class, predicting the market is hard to do so their philosophy is to build spreads around the current market position and adjust them with new positions as the market moves. If I were concerned about a rapid movement in the market in the near future I would avoid this strategy. But looking at the Leading and Consistent Economic Indicators available from the Conference Board I feel that the economy and market are both going to go sideways for a while. Everything seems to doing fine. But Iâm still learning. This is an experiment to get me started and to help me find out what I donât know. I wonder why the Theta graph is so choppy yet the P/L graph appears smooth between the break-even points?
Forums âºâº Main âºâº Options âºâº What's the Purpose of a Forum? jkgraham Registered: Apr 2011 Posts: 19 04-13-11 09:59 AM ""I hope itâs to help others"" ....quit your hope'n, hope does not fly here....the porpose of this options forum is for spin to tell his bad jokes, donna to fawn on him, attic man to kick the shit out of noobs, and hoco to wander around with his dashbored looking for prob of being touched....
The course just uses the P/L Graph and current values of Delta, Theta and Gamma to manage the portfolio. It never discusses the Theta 'Graph'. Just that we want positive Theta and the more the better. However now that I'm looking the graph, it appears that my Theta is drastically limited at some values of the market. That seems like a bad thing to me.
If options strategies are your area of interest, I would recommend that you pick one and practice it exclusively with paper trading until you are ready to risk small money trading it. Only then, should you branch out into other options strategies. There is a lot to learn and it is a wonderful journey, however scattering yourself over multiple strategies (condor, vertical spread, butterflys, strangles, etc) will diminish your ability to learn one thoroughly.
this forum needs to change its formatting so that when people post huge images, only that post gets extended to the right and not every other post in the thread. I mean, I know everyone here is a trader with huge monitors, but for those of us with regular sized monitors, we have to scroll back and forth.
I had the same conclusion. At least the board is active. I agree but I'm only working with two: Iron Condors, Double Calendars. That shouldnât be too bad should it? I think that being able to compare and contrast them in practice may be helpful. Iâll keep that in mind and try to reduce the image size next time.
About the Theta Graph. I had the "Plot Lines" setting at (+1@Expiration) which gave me the jagged saw-tooth graph. If I change the "Plot Lines" to (+1@Date) and incremented the "Prob Date" {Red Line} or "Simulation Date"{White Line} between today and expiration, the Theta Graph had a much smoother growth rate between the break-even points until the Monday before expiration at which point it started to become distorted as it approached expiration. This sort of confirms the philosophy of closing the position(s) a week or so before expiration because the Theta is mostly gone anyway. As long as it has a smooth and steady growth pattern which is more like what I hoped for and expected then I'm happy with my position and feel better about what the graph is telling me.