Call Out Your Potential Option Trade and Let's Discuss it

Martinghoul said:
Yeah, today was weird...
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The Markets are Always weird. -- When is this place ever a smooth, happy, magical, yellow brick road... :wtf:o_O
The marketplace is Part art, part science...takes skill and wizardry to handle and tame it successfully in the long run.
 
sle said:
I like that trade (not my mandate/AC, obviously). I'd sell a bit further out, like next month. Roll-down along the curve is in it's favor big time and it takes advantage of the bear trend.
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sle, can you expand on the "roll down along the curve"?
I think I know what you mean....ARe you referring to curve being options and the expiration time line or the futures curve?
 
J-Law said:
sle, can you expand on the "roll down along the curve"?
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Meaning that the cash is significantly under the futures of the same expiration as the option - if all stays the same in the world, you are gonna make that difference as the futures will converge "roll-down" to spot. It's a statistical trade and only makes sense in the markets that do not have a cash-and-carry style arb, e.g where futures are not fungible.
 
sle said:
Meaning that the cash is significantly under the futures of the same expiration as the option - if all stays the same in the world, you are gonna make that difference as the futures will converge "roll-down" to spot. It's a statistical trade and only makes sense in the markets that do not have a cash-and-carry style arb, e.g where futures are not fungible.
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Got it! Thanx.
 
Martinghoul said:
I haven't looked properly... I imagine the outright vol isn't at a super sexy level to sell. On the other hand, I can see some redeeming features, such as what sle pointed out. The way I see it, the main risk here, which could violently disrupt your trend, is a sharp USD selloff.
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Got to thinking. As a trade like this moves ITM could one effectively buy the next month October against the SEPT futures leg, making it a 1M Calendar futures spread (U/V) Would that lock up the trade & then all you have to do is wait out the decay?
The other idea also being if the mkt rallied making the put then an ATM/OTM, could one again do the same effectively neutralize the open futures leg to a 1M calendar spread & waiting out the trade to expiration. I believe there's a hole somewhere....attempting to piece it all together. Ghoulie, Whatta think?
 
I bought GDXJ Puts that expire This coming Friday August 19th.
My fill was Friday August 12th on the open on the 50 Strikes: 0.50.

This in my opinion is an excellent trade, I'm sure most will argue that it is not because of the massive decay. I think I can easily make 100% on this trade.
 
J-Law said:
Got to thinking. As a trade like this moves ITM could one effectively buy the next month October against the SEPT futures leg, making it a 1M Calendar futures spread (U/V) Would that lock up the trade & then all you have to do is wait out the decay?
The other idea also being if the mkt rallied making the put then an ATM/OTM, could one again do the same effectively neutralize the open futures leg to a 1M calendar spread & waiting out the trade to expiration. I believe there's a hole somewhere....attempting to piece it all together. Ghoulie, Whatta think?
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Calendar spreads in crude are a science unto themselves... Off the top of my head, Sep-Oct shouldn't be anything too exciting, but I am just not an expert on all the rinky-dinky aspects of the crude mkt.
 
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