This plan doesn't make sense to me. If you know the index is not going to move up for 1-2 years, why tie up your capital buying it now? Wouldn't you be better off buying it in 1-2 year?
VIX and call/put are about at the same level as the were on Feb-09. not a big deal, except that SPY was 14% HIGHER back then! can SPY really drop 14% in a couple of weeks?
I know that. But Vega's (that's the word you should be using) only a small portion of the option pricing. not only that, but you're wrong all together pretty much. Options are priced off their on IV and HV for the most part with $vix playing a role WITH that. AKA not a big deal. I bought these options a few days ago....not when the $vix was at the highs.
Exactly that's what he's not getting. I didn't get into these things until a few days ago. I took some profits today and actually added a new put? If i'm doing something wrong here please inform me. I sold USB for a 150% gain as well as ESV for 100% leaving quite a bit (mostly money) on the table at the moment. Options are mis-priced anyways by a normal curve.
I give you full credit for your honesty. I was right about you being really young. Let me get this straight. Are you saying you're paying for 2 people's rent and other monthly bills solely with your trading profits?
Did the same today - so I claim to be half ass-smart (make up for yesterday) Who knows tomorrow I may be all stupid.. or all smart - or half and half... we'll just have to see Take Care
FEB-27 Update: SPY -2.2%, VIX +4% (did not really budged), call/put +44% at 0.98 (still not at the extreme of recent bottoms). How are the major sectors doing? Most near or below Nov-2008 lows: SPY, DIA, XLF, XLE. Only QQQQ is noticeably above the previous year lows. The bottom line: the sentiment is WAY TOO Bullish. I am forced to conclude that there is more downside near term.