Weekly Trade Updates - Week 5: Taking off Winners and New Trades
Hi Steemians,
here are my weekly trade updates for Friday April 27 2018, 1.5 hours before the markets are closing.
If you haven't read my series on recent options trades, you can do it here:
https://steemit.com/trading/@stehaller/trade-ideas-for-today-s-pop-in-implied-volatility
https://steemit.com/busy/@stehaller/more-trade-ideas-for-this-high-iv-market
https://steemit.com/trading/@stehaller/trade-updates
https://steemit.com/trading/@stehaller/trade-updates-week-2
https://steemit.com/trading/@stehaller/trade-updates-week-3
https://steemit.com/trading/@stehaller/important-trade-updates
https://steemit.com/trading/@stehaller/weekly-trade-updates-week-4
Well, the market did what it did. We had some important earnings announcements, like FB, TWTR and AMZN, but I don't trade earnings and since I don't care about financial news, I don't know what their earnings were about.
Before we talk about my positions, let's have a look at some volatility indexes:
VIX (S&P 500)
RVX (Russell 2000)
OVX (Oil)
GVZ (Gold)
TYVIX (10 Year Treasuries)
So, as you can see ,volatility came in across the board, which helped our positions.
Let's have a look at the positions:
SPX Put Calendar (closed for a winner)
We put this trade on for a debit of $16.65. Today I closed it for a credit of $18.25, so a $1.60 ($160 per one lot) winner.
XLE Straddle Roll
I had the XLE May 71 short straddle on. Today we hit our 21 DTE threshold, so it was time to close or roll to avoid gamma risk.
I rolled it up to the 74 strike, to make it delta neutral again and out to June for a credit of 38 cents.
Here is the new position:
We now have the June 74 straddle on for a net credit of $4.05, but our original profit target hasn't changed, it is still 25% of $3.67 (=92 cents)
So if this straddle trades for $3.13, we take it off.
IWM Short Strangle
We collected a credit of $3.25 for this strangle.
It is profitable at the moment, but not at our 50% management target.
So we sit and wait.
QQQ June 162/165/185 BWB
This broken wing butterlfy is a 50 cents winner at the moment, but that's not enough, so we sit and wait.
New Trades
1. Short Strangle in TWTR
TWTR had earnings this week, but IVR is still high.
So I sold a 25 delta short strangle
Buying power reduction is only $294 per one lot, so I did four.
As always management target is 50% of max profit, so 82 cents.
3. Short Strangle in FB
FB had earnings this week, but IVR is still high.
So I sold a 16 delta short strangle
Buying power reduction for this trade is $1,857.
As always management target is 50% of max profit, so $1.21 cents.
4. Short Straddle in TLT
IVR is kinda low, but short straddles/strangles in TLT are my bred and butter trades (together with IWM, GLD, XLE)
The buying power reduction for this straddle is $2,377.
The management target for short straddles is 25% of max profit, which is 78 cents in this case.
So when this straddle trades for $2.35, we take it off.
5. 30 Delta Short Strangle in GLD
IVR is also kinda low, but I love to have short strangles on in GLD.
The buying power reduction for this trade is $2,278 and our management target is 50% of max profit (= 78 cents), so when this strangle trades for 78 cents, I will take it off.
If you want to learn more about options trading you have to wait, until my book comes out.
Stay tuned and watch https://www.tastytrade.com/tt/
I wish you a great weekend,
Stephan Haller
Legal disclaimer: These are not trade recommendations. Options involve risk and are not suitable for all investors. The trades shown above are for educational purpose only.