Although, I try to make good trades. And as a percentage my good trades generate profits, I had a very good day yesterday. And the past 7 days in a row have yielded profit.
Yesterday the big mover was KO, I was delta long KO through bullish calendar spreads. The upgrade came in the morning, and without knowledge of the upgrade I sold into the rally.
I watched this movie this evening… And Oh, yeah.. The next $5,000 that goes in my “Play jar” is being used to go to AK.
KO – sold 5 units of 60p calendar (much too early) for .17 and .20. I now have a very balanced “circus tent” calendar going. July/Aug 55p, 57.5p, and 60p. I have taken cash and risk off the table, and still have a 8:1 reward to risk on this trade.
EWZ – Yesterday’s gap down open hurt, yet I only had 1 spread on so it didn’t hurt too much
IWM – I added a few JunQuarterly/Aug 75c for 1.30. I picked this off on the intraday low 72.74.
SPY – I bought a bearish calendar JunQ/Aug 134 for 2.17. This should have enough Gamma, negative Delta, and Vega exposure to earn on the down move. And it’s breakevens are wide (129/139 with the pump in front month volatility. Also fits well into my double butterfly position. SPY 135 or SPY 140 provide the largest returns on Expiration June 20.
The KO and my index positions were nice winners. Increasing the porfolio by 3.2% on the day. I am pleased with that as only 20% of the porfolio is in the market, and I sit on 80% cash.
Getting ready for Wednesday. I think we still are seeking a drop to the 61.8% retracement on the SPY (133). Oh, and it is SNOWING in Breckenridge on June 11th. Hmmm. I went swimming after the market close yesterday, and on a 45 mi bike ride on Monday.
I have 53 SPY weighted POSITIVE deltas. I will be looking to add negative delta exposure today. Yet I am planning to sell some of my negative deltas as part of my individual plans… AEE, MFE, UST. What to do?
Michael Covel giving some good advice – I realize I am a trend trader, however a sideways trend. High Vega/Low Beta issues.
I have been flipping trades a bit here.
SDS – Bought 2 units on a break down of the SP. Bought @ 60.79. It ran up to 61.43 (S2 support pivot), and then reversed. Ran there again with a powerful A/D line then came back. I started adding some position exposure with SPY calendars, once I had some downside protection, I exited this SDS position with a very slight gain @ 61. It closed the day @ 61.75.
SPY – 1 unit in 3 accts July/Aug 134p calendar for 1.20.
MFE- Rolled all of my June 35p to July 35p for .75 and .76. I put the original Jun/Sept calendar for 1.48. I am getting half of my risk back on the front month. 2 months to go. It has a great sideways chart. And has just broke below its consolidation range 35.40 to 37.25 . Back into its wide trend 31 to 38.
KO – added 2 units of the 55p July/Aug for .30. I wanted to protect from the lower high, lower low trend. This gives me a 1-3-1 allocation to my KO position across 4 accts. This should have been how I started out the trade.
When all was done, the Markets were beaten. Even though I started the day aligned positive delta. Volatility and Theta overcame Delta. I ended up $172… Not worth putting a percentage to the gain. However, that does make 8 days in a row with positive P/L. Horray.
The market was down big today: SPX down 22.95 @ 1335, Dow down 181 @ 12,116, NDX 48 @ 1924.
Big movers for me today:
CHTT – OTM bear put spread profited from back to back $2 down moves in the underlying
MFE – Rolled my calendars for max profit on the day, underlying @ 35.
UST – the calendar spread moved my way another .17. I will be peeling this trade off, and looking to another spread.
IGT- moved down and hard against me.
Current Market greeks (SPX weighted)
I am very market neutral at this point without much gamma risk going into the next few days. That is good side, yet I had seen this move and I chose not to profit from it. Hmmm, trade offs. I am about 25% invested, 75% in cash (earning more than an index fund today)
Current SPY weighted