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AFAIK, the past 3 years was a once in a lifetime opportunity... at least until it occurs again. The current going nowhere doldrums is the most boring market of all. In addition to changing the width of your double diagonals, you might consider experimenting with ratioing them (unbalanced).

Going nowhere can get you somewhere. You've got talent! :)

I'd answer you point by point but most of your reply had nothing to do with anything. Reality is, the general public uses the word premium to mean total cost. If you and your market maker friends want to use it another way, fine, but don't go to England and insist that everyone is wrong and...

OK, I'll bite. The Series 7 exam (for brokers) states that the OPTION PREMIUM is the amount that someone pays or receives for the option contract and is composed of two parts - extrinsic or time premium and if in the money, some intrinsic premium as well). Books by reputable authors say the...

The two spreads are eqiivalent. If you're bullish, sell the put spread instead of buying the call spread and vice versa if you're bearish. If you're right and the options expire OTM, you save on exit slippage and commissions. IV change has no relevance with these equivalents.

Combining TBT and TLT in a 1:2 pair would give you a result far different than the correlation that you expect. Leveraged ETFs have compounding errors and over time their values skew away from the underlying that they track. There are cumulative time periods where TBT far out/under performs...

With yesterday's news regarding their tender offer, implied volatility is up so puts have inflated in value.

You margin requirement will be calculated based on holding 3 covered calls and 7 naked calls.

First off, my oops for my previous reply. I misread the question and thought that you were asking about a short straddle. My bad. You're an evil person. You made my head hurt! It doesn't matter which side you roll because the net delta will be the same either way. Therefore, the result...

Not that it's of any great importance to you but if you want to highlight your text instead of using CAPS, bracket your comments with a b and a /b in brackets. I can't type them in correct order since they do their thing rather than show as text so reverse the two below [/b] your written...

IF YOU WANT PEEPS TO HELP YOU, YOU SHOULD PLAY NICE... EVEN THO I'M PROBABLY BE THE LAST ONE WHO SHOULD SUGGEST THIS :)

SANITY CHECK ? The title of this month's issue of MONEY magazine is "The 20 Best Money Websites... and the one's you should avoid." I quote, "Don't take investing advice from Yahoo Finance message boards." ROFL

It depends. Rolling the put up will be better if the UL reverses. Rolling the call up will be better (or at least less worse) if it continues up.

Why wear a collar when you can just spread em??

Thanks for sharing that. I learned something today! :)

Over the years I've found that risk graphs are a little more optimistic than reality because of slippage. So I'd say that I'm not wild about this position. I think that your analysis of the what ifs is correct but I'm not sure that you'll see a serious increase in July IV unless all months...

Yes, one of the many strategies that LTCM used was pairs trading. As MTE mentioned, it was their extreme debt to asset leverage that was their downfall. It was something like 30:1 before the Russian bond defaults eroded their equity and forced them to unwind positions prematurely.

If you hold only appreciated shares, you can't write a covered call, get assigned and then buy shares to fulfill the assignment. A short option isn't likely to be assigned if there's time premium remaining - but that's no guarantee it won't happen. The only sure fire way to avoid...

And that's exactly the point that you missed previously. The strategy that you say isn't equally good for that type of market isn't a bad strategy. It's just not the appropriate one for the circumstances at that time.