Destriero - Butterfly Trades

[ironchef]

Im long the 227.5 and 230 calls going out tomorrow..Its a punt,and I legged the butterfly for a small credit..This year I decided to punt more and not grind it out..

I am my own worst enemy:

Everyone here drilled into me never legged in or out of a butterfly. So I have two more GILD flies, one 60/64/68, the other 61/64/67. yesterday GILD gapped up to $68 and I panic, closed out the challenged wings but left the other side alone. Shouldn't have done it! Now I can only make a small profit if GILD is above $64 or take a loss if GILD goes below $64 at expiration. If I did nothing, both would still be profitable and I have a shot at some decent profits.

 

[caroy]

I am my own worst enemy:

Everyone here drilled into me never legged in or out of a butterfly. So I have two more GILD flies, one 60/64/68, the other 61/64/67. yesterday GILD gapped up to $68 and I panic, closed out the challenged wings but left the other side alone. Shouldn't have done it! Now I can only make a small profit if GILD is above $64 or take a loss if GILD goes below $64 at expiration. If I did nothing, both would still be profitable and I have a shot at some decent profits.

As I've been trading weekly flies I will leg out at the close and on expiration day but I only do it after buying back the guts first leaving my long gamma and a chance for the long options to run into the profits. Did it last week as I exited draft kings and ended up a few bucks ahead for doing it that way. But I often ask if it's really worth it.

 

[taowave]

Does not compute...

I am guessing you are long the flys,and assuming they are call flys..

What is a challenged wing?? Im guessing the upper strike wings??

Why would you blow out of your long wing as the stock gapped up?? Did you want to get short??

Your sweet spot is 64,as I believe you are now in the 1x2 with "unlimited" upside risk.

Either I am completely confused or you are a bit confused

I am my own worst enemy:

Everyone here drilled into me never legged in or out of a butterfly. So I have two more GILD flies, one 60/64/68, the other 61/64/67. yesterday GILD gapped up to $68 and I panic, closed out the challenged wings but left the other side alone. Shouldn't have done it! Now I can only make a small profit if GILD is above $64 or take a loss if GILD goes below $64 at expiration. If I did nothing, both would still be profitable and I have a shot at some decent profits.

 

[ironchef]

Does not compute...

I am guessing you are long the flys,and assuming they are call flys..

What is a challenged wing?? Im guessing the upper strike wings??

Why would you blow out of your long wing as the stock gapped up?? Did you want to get short??

Your sweet spot is 64,as I believe you are now in the 1x2 with "unlimited" upside risk.

Either I am completely confused or you are a bit confused

I have two sets of flies: both 121 calls one set is long 1 60, short 2 64 and long 1 68, the other is 61/64/67.

I closed out the upper "spread": bought to close short 64 calls and sold to close long 68 calls.

So now I am left with a set of long 60 short 64 and a set of long 61 short 64.

Does that make any sense?

 

[ironchef]

As I've been trading weekly flies I will leg out at the close and on expiration day but I only do it after buying back the guts first leaving my long gamma and a chance for the long options to run into the profits. Did it last week as I exited draft kings and ended up a few bucks ahead for doing it that way. But I often ask if it's really worth it.

Thank you for the coaching.

 

[taowave]

Ok,so you were long the flys and closed out the short 64-68 call spread,leaving you long the 60-64 vertical..What did you pay for the 64-68 call spread?? What did you pay for the fly?? You may have locked in a loss..

Im guessing you were trying to cover deltas,but thats not the way I would go about it...

You shifted a positon that had a favorable risk reward to one where it is now unfavorable with very limited upside,if any at all

I have two sets of flies: both 121 calls one set is long 1 60, short 2 64 and long 1 68, the other is 61/64/67.

I closed out the upper "spread": bought to close short 64 calls and sold to close long 68 calls.

So now I am left with a set of long 60 short 64 and a set of long 61 short 64.

Does that make any sense?

 

[Justrade]

I have two sets of flies: both 121 calls one set is long 1 60, short 2 64 and long 1 68, the other is 61/64/67.

I closed out the upper "spread": bought to close short 64 calls and sold to close long 68 calls.

So now I am left with a set of long 60 short 64 and a set of long 61 short 64.

Does that make any sense?

NO... doesn't make sense
Unless U covered the 64-67 as well
which I know U did if u say ur now holding 60-64 and 61-64 call spreads

 

[taowave]

He covered both short verticals,and is now synthetically short the OTM put spreads at most likely pennies

NO... doesn't make sense
Unless U covered the 64-67 as well
which I know U did if u say ur now holding 60-64 and 61-64 call spreads

 

[.sigma]

Peace.

OK so he didn't select her, someone else did. Still his persistence and perseverance after half a century is admirable. I would have given up a long time ago.

America is a tale of two cities. Hope he can bridge the grand canyon gap between the two, for America's and the world's sake.

You are one of the good guys on ET. Keep up the good work.

I’m just playing devils advocate. I have no idea if they truly do select the Vice Presidents or not, but it’s healthy to question anything related to these oligarchs.

thanks for the kind words, appreciate it.. you are too!

 

[caroy]

@taowave, @newwurldmn, @TrailerParkTed et al,

I noticed almost no one that worked for him or supported him lasted. He used people until they were of no value to him, then threw them under the bus.

OK, back to lossless butterflies. Is that possible?

In the limit, body -> 0, loss -> 0.

As a member of the papist distributivism line of economic thinking I can't say i'm a fan of either party when it comes to politics. I am very curious what the Orange One does next. He owes Deutschebank a rather large sum due in a year. I'm hoping for an ex-president reality show strictly for the entertainment value. For Biden I respect his tenacity. He's been running for president for over three decades and finally hung in there for a win. I'm hoping for a better spirit of bipartisanism. I have a number of friends who are big Trumpers and were convinced he was returning at noon on Wednesday to arrest all the democrats. I can't understand how in the last few years so much thinking has become detached from reality. Hoping the dumpster fire of 2020 is behind us and things look up.