SPX Credit Spread Trader

Quote from riskarb:

SPX out of steam here at 133775 -- looks like a decent short here. NK planning a nuke test. Sold Dec 134700.
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Began scaling into short puts here at 134400 to covert to short synthetic straddle -- strikes from 15-30 otm [puts] and various durations.
 
Quote from optioncoach:

lol... short ES at 1345.50.... holding on for late bust lower or else I am out at 1348
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I'm going long and taking out the gazillion stops at 1348. It might take 2 or perhaps 3 ES contracts to achieve this since everyone and his dog is short. As riskarb would say: feel the power! :D
 
Too late... lol

already scaled out of half the position for profit and getting ready to close out if market keeps moving back higher...

anyway still sitting on a NOV SPX spread order below mid and no fill....

Quote from momoneythansens:

I'm going long and taking out the gazillion stops at 1348. It might take 2 or perhaps 3 ES contracts to achieve this since everyone and his dog is short. As riskarb would say: feel the power! :D
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Mark, Coach and others
Can we use the DD to hedge against our traditional Credit Spreads?. For every 10 contracts of selling Credit spreads or IC, buy 1 DD.






Quote from dagnyt:

The longer you hold the greater your potential return - unless

a) your short strike is threatened

or b) the market runs away from your strikes. This is especially problematic if you paid a debit for the position.

Thus, with diagonals, your intention should be to hold and let time do its thing.

But remember, although theta is your daily ally, it's VEGA that will determine the size of your payday. It's VEGA that tells you how much you collect when you eventually close the position. This is especially true when youa re able to hold until very enar expiration day.

IMHO, if you get a nice sized spike in VEGA, think about taking the nice profit (if it's available) and close. If your short strike is threated and you still have a profit, that's another time to consider closing.

If your short strike is breached - do not pass go, do not waste time - take action and close (or adjust) the position. You might want to open another position at that time, but don't take chances when the short strike is breached.

Mark
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DD is $25 a point I believe and is the Large Dow contract. You would have to really try and match the move of the SPX to the DOW and if you are wrong the market moves away from your shrot strike you could lose big.

I have alwyas said, futures are a hedge in an emergency situation for the moment but not to hold for more than the initial shock.

Long options are better than futures for placing a hedge that you will hold in place..
 
Quote from momoneythansens:

I'm going long and taking out the gazillion stops at 1348. It might take 2 or perhaps 3 ES contracts to achieve this since everyone and his dog is short. As riskarb would say: feel the power! :D
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mo, you still scaling into puts? :mad:
 
Coach
By DD i meant double diagonal. I didnot know that it was a symbol for some futures contract:eek:

Quote from optioncoach:

DD is $25 a point I believe and is the Large Dow contract. You would have to really try and match the move of the SPX to the DOW and if you are wrong the market moves away from your shrot strike you could lose big.

I have alwyas said, futures are a hedge in an emergency situation for the moment but not to hold for more than the initial shock.

Long options are better than futures for placing a hedge that you will hold in place..
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:eek:
 
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