SPX Credit Spread Trader

Your analysis is correct, maybe I'm just jaded because I've gotten burned so many times on close to the money spreads that end up costing me month's of profits.....

Quote from momoneythansens:

IMHO,

That's not as ridiculous as it sounds. I personally wouldn't take it because it doesn't fit my entry criteria.
[Edit] That's a 72% chance of making a 16.28% Return on Risk in just over 2 days - that's more than some people make all year.

Momoney.
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I'm genuinely sorry to hear that. Did they start out as close to the money spreads? This is a big difference. I think position sizing is also key with NTM/ATM spreads and having as little time as possible to be wrong when you are short curvature/gamma - in this instance 3 days.

Hope you are faring better with FOTM spreads :)

Happy trading.

Momoney.

Quote from skdoyle1:

Your analysis is correct, maybe I'm just jaded because I've gotten burned so many times on close to the money spreads that end up costing me month's of profits.....
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Coach,

I still haven't done anything yet with my 1280/1285. I know it's very risky. I hope I will get some TIME VALUE tomorrow. The OptionsRez Calculator analysis told me I have 81% of success in this trade, using the actual price, option prices, expiration date and volatility.

What do you think?

Also SPX couldn't close above the 1272.89 last high. I am worried for sure but I want to see how it opens tomorrow.

Thanks a lot


Quote from optioncoach:

Those of you in 1280s and 1285s I wuld start devising an exit strategy now since today's price action as of now (SPX @ 1272) is quite bullish.

See below chart...
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A/D line was very bullish today; N100 notwithstanding. I think it's going to be a close call, but expect SET to be <1280. EUR and Asian index markets sold after the Fed. Keep a close eye on the Nikkei close tonight.
 
Hedge up those Straddles or Irons or Verts.

Gamma Week should not be without hedges under almost all circumstances, that's what the ES was made for.

But remember hedges are hedges.....everyone loses money on their hedges. They're designed to lose money. It simply means your original bet was wrong (kind of)(and (only) for now)).

Only Riskarb makes money on his hedges.

But he's really good. :)


Quote from skdoyle1:

Your analysis is correct, maybe I'm just jaded because I've gotten burned so many times on close to the money spreads that end up costing me month's of profits.....
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SET will be between 1285 and 1290. This mkt could get a huge push tomorrow from MO. I am pricing the stock at 80 to 82 after a positive court decision. MO is very heavily weighted in the SP 500. We also have CPI tomorrow and the Iraqi elections. Anything short of WWIII and this mkt could blast off. The boys on the floor are ready this time. It was so easy to mark stocks up last November pre-market to push the SET up. It will be easier now with many players leaving for the holidays and less liquidity. I would be careful.
 
I think based on the technical breakouts and the circumstances you site, we certainly have more room to run before Friday and the SET could be + 8 points....


Quote from Maverick74:

SET will be between 1285 and 1290. This mkt could get a huge push tomorrow from MO. I am pricing the stock at 80 to 82 after a positive court decision. MO is very heavily weighted in the SP 500. We also have CPI tomorrow and the Iraqi elections. Anything short of WWIII and this mkt could blast off. The boys on the floor are ready this time. It was so easy to mark stocks up last November pre-market to push the SET up. It will be easier now with many players leaving for the holidays and less liquidity. I would be careful.
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LOL, Mav had to work in the MO dig... lmao

OK, ok... how 'bout a little wager -- I say no more than $3.00 in upside from today's NYSE close on MO. Loser goes to Manhole, shirtless, and dances on a table.

I realize it's your fantasy, so no lose for you! :p
 
Quote from Dr. Zhivodka:

...means your original bet was wrong (kind of)(and (only) for now)).
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LMAO. Nicely put.

When is a hedge not a hedge? When it makes more money than what it's hedging, in which case, what it's hedging is actually the hedge for your hedge.

[EDIT] Another pointless post from Momoney, enjoy :)
 
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