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Monday, April 7, 2014

VXX and SPX Iron condors

Weekly Iron Condors - best fits for my trading

VXX
Buy100VXX11Apr14(W) 39.00 Puts
Sell100VXX11Apr14(W) 39.50 Puts
Buy100VXX11Apr14(W) 45.00 Calls
Sell100VXX11Apr14(W) 44.50 Calls

Market:$0.12 Sell

SPX:

Buy10SPX11Apr14(W) 1,800.00 Puts
Sell10SPX11Apr14(W) 1,805.00 Puts
Buy10SPX11Apr14(W) 1,885.00 Calls
Sell10SPX11Apr14(W) 1,880.00 Calls


Market:$0.60 Sell

Monday, March 17, 2014

Weekly Iron Condors - best fits for my trading

Week of March - 17 - 21 2014

GLD
GLD Mar 14 129.50 Put
GLD Mar 14 130.00 Put
GLD Mar 14 135.50 Call
GLD Mar 14 136.00 Call

IWM
IWM Mar 14 115.50 Put
IWM Mar 14 116.00 Put
IWM Mar 14 121.00 Call
IWM Mar 14 121.50 Call

QQQ
QQQ Mar 14 88.00 Put
QQQ Mar 14 88.50 Put
QQQ Mar 14 91.00 Call
QQQ Mar 14 91.50 Call

SPY
SPY Mar 14 181.50 Put
SPY Mar 14 182.00 Put
SPY Mar 14 189.50 Call
SPY Mar 14 190.00 Call

VXX
VXX Mar 14 42.00 Put
VXX Mar 14 42.50 Put
VXX Mar 14 48.00 Call
VXX Mar 14 48.50 Call


Tuesday, March 11, 2014

Two of my positions are up four down...

my positions today...

                                chg | %
QQQ 90.14 -0.47
GLD        129.82 +0.69
SPY        187.10 -1.11
VXX 49.36 +0.40
EEM 38.82 -0.43
EWZ 39.45     -0.18
UNG 25.47 -0.25

Monday, March 10, 2014

what is volatility?

Volatility on an instrument can be defined in terms of the normal distribution curve, a bell shaped curve, if curve is flatter and wider, it represents the occurrences of a wider range of prices for a particular period of time. A more narrow and cylindrical (taller) curve, representing a narrower range for the price occurrences. In the first case the instrument will be considered a high volatility vs the latter case.

Lets say we have two stocks each priced at $100, we buy a $110 call expiring in 30 days. Now lets suppose the 1st stock moves only $.5 each day, while the 2nd one moves $5 each day. In 1st scenario the of the $110 call option, the stock has to move up for 60 consecutive days  for the option to end up in the money. The 2nd stock with price moving $5 each day the stock has to move up only two days for the option to end up in the money. That is why volatility matters and options are priced differently.

Friday, March 7, 2014

Total premium, margin required for this week's trades



Date Symbol Premium Total Premium Margin/contract Total Margin Date Expire
3/6/2014 QQQ 20 $0.11 $220$50 $1,000 3/14/2014
3/7/2014 EEM  20 $0.12 $240 $50 $1,000 3/14/2014
3/7/2014 GLD 20 $0.15 $300 $50 $1,000 3/14/2014
3/7/2014 EWZ  20 $0.12 $240 $50 $1,000 3/14/2014
3/6/2014 SPY  20 $0.13 $260 $50 $1,0003/14/2014
3/6/2014 UNG 20 $0.15 $300 $50 $1,000 3/14/2014
3/6/2014 VXX  20 $0.12 $240 $50 $1,000 3/14/2014

Weekly Iron Condors - best fits for my trading

Candidates for the weekly Iron Condors week of Mar 7-14

QQQ
Buy20QQQ14Mar14 (W) 89.13 Puts
Sell20QQQ14Mar14(W) 89.63 Puts
Buy20QQQ14Mar14 (W) 93.63 Calls
Sell20QQQ14Mar14(W) 93.00 Calls

GLD
Buy20GLD14Mar14 (W) 133.00 Calls
Sell20GLD14Mar14(W) 132.50 Calls
Buy20GLD14Mar14 (W) 127.50 Puts
Sell20GLD14Mar14(W) 128.00 Puts

EEM
Sell20EEM14Mar14(W) 38.50 Puts
Sell20EEM14Mar14(W) 41.00 Calls
Buy20EEM14Mar14 (W) 41.50 Calls
Buy20EEM14Mar14 (W) 38.00 Puts

EWZ
Buy20EWZ14Mar14 (W) 39.00 Puts
Sell20EWZ14Mar14(W) 39.50 Puts
Buy20EWZ14Mar14 (W) 43.50 Calls
Sell20EWZ14Mar14(W) 43.00 Calls

SPY
Buy20SPY14Mar14 (W) 184.50 Puts
Sell20SPY14Mar14(W) 185.00 Puts
Buy20SPY14Mar14 (W) 191.50 Calls
Sell20SPY14Mar14(W) 191.00 Calls

UNG
Buy20UNG14Mar14 (W) 24.00 Puts
Buy20UNG14Mar14 (W) 27.00 Calls
Sell20UNG14Mar14(W) 24.50 Puts
Sell20UNG14Mar14(W) 26.50 Calls

VXX
Buy20VXX14Mar14 (W) 40.00 Puts
Sell20VXX14Mar14(W) 40.50 Puts
Buy20VXX14Mar14 (W) 47.50 Calls
Sell20VXX14Mar14(W) 47.00 Calls

Wednesday, March 5, 2014

why trade weekly options?

Trading weekly options  has the potential to offer quick turn around on your capital. 
In my observation weekly options has a higher probability of expiring worthless then the monthly option contracts. 

Although the premiums are lower but if done right the return may be higher in the weekly's. 
Out of the money weekly options on indexes and etf's offers enough premium to sell
at lower cost/margin requirements. 

In my strategy I choose a balanced portfolio of etf's to offset the risk on either side, the candidates have highly liquid options contracts, strike prices are 1 to .5 points apart and finally the underline has enough implied volatility offering adequate premiums to offset fees/commission costs and turn into a profitable trade.