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Hey!!! Someone deleted the funny posts about homosexuality and Dianetics! What gives??

GATrader, What do you mean by "if u buy an extra wing, you have the early participation as it moves to sweet spot"? Thanks! Andy

Riskarb, Thank you for your contribution to this board -- they are quite educational (and thanks Coach for occasionally translating riskarb-speak for the rest of us). Wondering if you can share the source of the analyis you buy in case we want to subscribe too? Also, did this analysis...

I can't put my finger on it but I'm expecting a mini rally next week.... We've been correcting-by-time healthily for a few days now without any huge dips. If the Fed even hints at some good news next week, along with the propensity for the market to rally during exp week, plus the fact that we...

Coach, Thanks for the translation. So in your example, 1220 to 1300 is the MM's expected distribution of pricing over the life of the straddle -- but is that 1 sd (68% of the time) or does sd not come into play here? Thanks!

Anyone interested in a speculative DEC 1250/1265/1280 (or thereabouts) fly?

Cody, Great point about the hedge (the purchase part) of a 25-point spread not being super effective. I wonder if that can be fixed by purchasing some slightly OTM calls/puts or a fly as additional hedges. Also, I know coach does not really like to do this but when the short strike is in...

Wouldn't a 5 pointer be a much quicker death than a 15 pointer? Speaking of which, I'm checking out some 25 pointers for Jan. Coach, you ever do 25 points spreads?

1236? Um, I think your 1280 strike is causing some wishful thinking.....

Any other funds or fund managers besides Yu-Dee Chang, Ansbacher, Oxeye and Welton selling option premium? Any insight on how they use futures to hedge their short options? Are they just neutralizing deltas every so often?

Coach, With the market so extended, possibly close to the peak of it's cycle, and likely to reverse on Jan 1 (see last years chart after a bull Dec), why would you put on a put spread now?

It's 9.75% right now...

rdemyan, I'm not answering for coach but whatever you end up doing should be based on your belief of what the market will do. In the next weeks/months do you think the market will go up or down or sideways? Are vols low or high compared to where they will be in the next few weeks/months? My...

I just checked front-month (dec) ATM vol and it is indeed 7.5%. How do you know that is 40% below model fair value (which puts fair value at 12.5)?

ENCORE!

Yes, yes, yes,.... I should have stated that you'd have to move to options on SP instead of SPX (same mechanics) so you could use SPAN margin -- that's a given. So, why not sell naked options? Yu-Dee Chang, Ansbacher, Zenith Fund, Oxeye,... and several other premium selling funds do it.

Coach, I'm curious, why don't you just sell naked options? You'd be able to go MUCH further OTM. I know, I know, "unlimited risk"... but right now, you stand to lose $10 to make only $0.50. I can't imagine naked options would be any worse than 20:1? You'd cut your losses way before you got...

Hey Coach, Question for ya... Say the market did rally suddenly and you had to roll out your 1285 strike (or close the spread). Would you consider rolling to say the FEB 1325/1350 for a lot more credit ($2.80). The premise would be that in the next 30 days the market would end it's year end...

1205/1220 put spread for $1.15 is looking attractive (of course, AFTER the pullback ends and the rally resumes so as not to get in the way of a locomotive)...

Coach, I guess the last hour has a lot to do with this, but if this is the beginning of the much anticipated pullback, the pullback is likely to last either long enough or go low enough to touch the 10-day EMA, which is currently at around 1250. If this happens, you probably can leave your...