SPX Credit Spread Trader

[El OchoCinco]

New Experimental Put Calendar Spread:- Update

Original Position

BOUGHT 1 OCT EW 1290 Put @ 12.00 ($600 EOM Options)

SOLD 1 SEP ES 1290 Put @ 2.50 ($125)

NET DEBIT = $475.00 9.50



With the nice pull back today in the market the spread is currently priced at 11.30 (15.50/4.20) to close. I am not looking to close it now but just wanted to track price changes with moves in the market.

 

[El OchoCinco]

Well with the dip in the market today I was looking to enter Put Spreads for Oct but have to say I am a little clueless as to what could be happening in the next 45 days as the Fall gets pretty volatile. Therefore I decided to "scalp" some premium for September with only 8 days or so to expiration:

SOLD 300 SPX SEP 1245/1255 Put Spreads for $0.20

Maximum Risk = $294,000

Net Credit = $6,000

Return on Risk = 2%



Premium is at the bottom of the range for return I would prefer and therefore this is a slightly riskier spread than I would normally enter into but with just one week to go to expiration and Fed and economic data not sending us into any more turmoil, I feel there is enough support levels to hold the strikes.

 

[spreadn00b]

I see a lot of folks talked about trading spreads on Sept 11 or at least paper traded 9/11 ... but my question is, how viable would this strategy be during 98, 99 and then again 00-02? Those were quite volatile times.

It seems like that nice runup in 98-99 might've shook a lot of call spreads, or just plain made it unprofitable.

 

[ChrisM]

Quote from RichardRimes:

so you do have to monitor them daily....

To get the most of it, yes. But only in specific trading range. You may also set GTC orders which would work if you don`t mind giving up of some small percentage.

 

[Pabst]

IMO there's an ABSOLUTE degree of event risk in the next 8 days. I might be willing to give someone 20-1 odds that we don't break 50 handles but 50-1? You're on drugs.

Quote from optioncoach:

Well with the dip in the market today I was looking to enter Put Spreads for Oct but have to say I am a little clueless as to what could be happening in the next 45 days as the Fall gets pretty volatile. Therefore I decided to "scalp" some premium for September with only 8 days or so to expiration:

SOLD 300 SPX SEP 1245/1255 Put Spreads for $0.20

Maximum Risk = $294,000

Net Credit = $6,000

Return on Risk = 2%



Premium is at the bottom of the range for return I would prefer and therefore this is a slightly riskier spread than I would normally enter into but with just one week to go to expiration and Fed and economic data not sending us into any more turmoil, I feel there is enough support levels to hold the strikes.

 

[rallymode]

Quote from optioncoach:



SOLD 300 SPX SEP 1245/1255 Put Spreads for $0.20

phil, you are going to give me a heart attack. mav must be out of town.

 

[El OchoCinco]

Glad I made you all happy...

 

[Cache Landing]

Quote from optioncoach:

Glad I made you all happy...

For what it's worth, I don't think you are in trouble at all.

 

[dagnyt]

Quote from optioncoach:

Glad I made you all happy...

Concerned, rather than happy.

I know plenty of people who went belly up selling (or failing to cover) FOTM options for 1/16 and 1/8 during expiration week.

Mark

 

[Cache Landing]

This market won't drop below 1280 until SEP 15th at which point OC won't be worried at all. Even then, it is likely that we will get one last rally through the next FOMC meeting. But from there it is all downhill fast.