UPDATE- CALL DIAGONAL POSITION
Sold 135 SEP EW 1340 Calls @ 6.50 ($43,875 Credit)
Bot 150 OCT ES 1360 Calls @ 5.25 ($39,375 Debit)
Net Credit =
$4,500
Max Theoretical Risk = $150,000
Current Return on Risk = 3%
I shorted 2x as many SEP EW and added more OCT ES to even out the legs.
I did so by shorting 135 SEP EW 1340 Calls @ 3.30 ($22,275) and buying 120 OCT ES 1360 Calls at 2.75 ($16,500) for a net credit of $5,775.
New Net Credit = $10,275
Max Theoretical Risk = $270,000
Return = 3.8%
--------> DEC ES is trading at 1333.50. Not gonna make any adjustments yet with 2 weeks to go in order to see if we pull back some as I expect. The EW shorts are European style so no worry about early assignment. I would like some of the time value premium sucked out of them to make adjustments easier next week if needed. I would like to see the market bounce off of these surges for a week or so to draw out that prmeium but 1353 is the high and it might be tested with the fed meeting.
Will watch closely and see.....
Some stress but not as much as a vertical credit spread....
