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Devilfish, I understand what you are trying to do. However, the skew that you have in your IC is quite substantial. I suggest a much reduced skew, but using some insurance. Your premium earned for the puts will be minimal, and won't help much if the market moves upward. 25 points upward can...

Sebastion, I'm glad you are asking questions. It's far better to ask questions before you try to use options than after you have lost your money. Keep asking. Most of the people on this forum want to help you keep your money! As I (and many others) stated before, you really should save...

Sebastionay: You're getting good advice from the responses above. 1) Read all you can before starting. Any investment that gives you leverage, such as options, is an investment that can be very dangerous as well as potentially quite profitable. Realize that there are substantial risks...

His website talks about theta decay. Practically speaking, this inevitably means selling some sort of spread. It may be an Iron condor style or broken wing butterfly with a little twist or some sort of calendar play.

Interesting discussion. Please read my comments very carefully before you respond! Credit spread trading is a very interesting game. Frankly, adjustments are a huge part of how I play (and succeed) . To me, an adjustment is an admission that you have been wrong and need to get out of the...

I hope you collected a really healthy premium for that IC, and I also hope it isn't a large fraction of your overall portfolio!! It is possible that the SET will be below 1165, but it's about a 50/50 bet it will be higher. The problem for you is that it easily could be $5 higher. In that...

After reading the first post I had to chuckle when I saw the OIC's optionseduction.org part. Look carefully at the letters in bold, folks. That's a whole new use for options that we've never heard of before!!! :)

Nitro, I really like your idea. Anything which allows a retail trader to simplify a process or customize his risk exposure is a good thing. In this case, if I were vega negative overall, I could simply choose to buy some calls to neutralize my exposure should I desire to do so. It strikes...

Adam, Since the SPX has many strikes (a feature that I really like along with the liquidity of this market), it is pointless to try to give you what the true prices should be for various spreads since the possibilities are nearly endless. However, I will give you a few tips for determining...

re Xflat's comments above--- (and he is right) As a consequence, you should always wait a minute or two before you change your bid on a spread, and a bit more if you are entering a butterfly or condor. It is surprising how quickly things are done, however. I think it may depend on your...

Charles Cottle's books are superb for this and give illustrated examples of multiple styles of adjustments. He even has a chart or two dealing with many of the ways to transform one named strategy into another. My only caveat is that knowing the name of the strategy is trivial compared to...

Where would you like him (Favre) to go...home to Minnesota?? Possibly to a nice retirement home? On a vacation in Tahiti? Away for good? :D

Actually, xflat, the put prices he is quoting are correct, at least they are if Yahoo Finance is. I see the 4 Put at 0.98-0.99 and the 5 Put at 1.76-1.79. He will obtain a credit of at least 0.77 for his trouble, assuming he is getting the worst price being currently quoted. He risks 0.23...

Can you give me a specific example to model, Walt? Pick one that looks like it might work really well for you. I'll be happy to look at it and comment.

I believe the reason reverse calendar spreads are rarely mentioned is the unfavorable margin treatment that is attached to them. A regular calendar-- buy February, sell January-- is considered covered and requires no margin other than the initial purchase cost which is obviously present...

Some comments: 1) I checked the current prices at the close Friday and see that about $1.60 is a more likely price for this condor. If you actually got 1.95, you are doing well. The SPX market makers are a bit tricky, but you can make this work if you are patient. 2) Have you simulated...

erol, My instinct is that Tao is correct with his comment about delta/gamma. I have noticed this buy high/ sell low situation when adjusting IC's, as well. For instance, when the market index moves up, you wind up rolling up calls that have become noticeably more expensive. If the...

Sorry, I wasn't clear when I referred to the 25:15 ratio. This is my own particular way of thinking about BWB's so it needs some explanation. When I set up a BWB, or a DBWB, I look very carefully at the spacing of the wings. My preference, if it can be done, is to have a butterfly that...

Spin, I think that the collar can involve either the 620 or the 630. The risk characteristics are quite a bit different. Writing the 620 is much more conservative. Writing the 630 improves the upside quite a bit, but it is much harder to make a profit to the downside. Walt, the idea...

Spin, Omaha steaks?? That's what comes out of the back of an Alberta steer!!! Seriously, Alberta AAA beef aged 28 days is better than anywhere else except for beer fed Japanese beef, which is a little hard to get around here. I've eaten beef all over North America and in the UK and...