SPX Credit Spread Trader

Quote from Maverick74:

Rally, you missed my point. I never what said happens all the time. I simply said the fact that he saw it once does not mean that it happens all the time. I explicitly said it depends on the order flow. The skew changes changes constantly. It can change because of a sharp move in the market or it can change if the market trades flat. So I never said what happens all the time. nothing in the market happens all the time. THAT WAS MY POINT!
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Point taken. I should avoid general statements like that.:)
 
Quote from Maverick74:

Rally, you missed my point. I never what said happens all the time. I simply said the fact that he saw it once does not mean that it happens all the time. I explicitly said it depends on the order flow. The skew changes changes constantly. It can change because of a sharp move in the market or it can change if the market trades flat. So I never said what happens all the time. nothing in the market happens all the time. THAT WAS MY POINT!
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mav, thats not what you said in your initial reply to cache or i wouldnt have addressed it.

Quote from Maverick74:

That's not true. With a steep negative call skew in most indices, vols will actually rise on rallies as a result of the vol skew. Yes, the ATM vols will drop, but the skew floats.
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Anyway, now that you have qualified your statement it's all good. No beef here.
 
As long as we stay below 1400, normal as been defined by the past few months does not exist for me yet :)

Quote from kalikahuna:

The market seems to be returning to normalcy. I'm thinking of putting on some Put spreads. whaddya think? another massive drop before 15th?
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yeah, I hear ya coach. But with VIX being higher than it has been for months and us being 2 weeks away from exp. and this being a friday, the finger is itching to pull the trigger and put something on the other side of the RUT 830/850.

Dont know if I'm gonna sit this one out or jump back in. I'll decide at 12:30PST
 
Play some X-box, that will cure that itchy trigger finger.



Quote from kalikahuna:

yeah, I hear ya coach. But with VIX being higher than it has been for months and us being 2 weeks away from exp. and this being a friday, the finger is itching to pull the trigger and put something on the other side of the RUT 830/850.

Dont know if I'm gonna sit this one out or jump back in. I'll decide at 12:30PST
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Quote from MechTrade:

Ugly & Rally,

Did either of you read my post about exiting a FOTM bull put spread during the heat of the battle Tuesday afternoon?



Legging out during the meltdown yielded an unexpected profit of $3500.



Once I was out of the short position, I went into trading mode, where the other three long legs were exited over a period of about 30 - 45 minutes using limit orders. And while the SPX was frothy during that period, my orders were executed between the B/A. The trading mode brought home the bacon.
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MT, I am very pleased that you made money getting out on a rough day. The thing is, those profits were either luck (not predictable) or your skill (not replicable by others). My concern (and possibly Rally's, but he can speak for himself) is that there is a major flaw in the low vol condor strategy. Condors are always a bet that realized vols will be lower than implied. Does this make sense in a historically low vol environment? Couple that with the fact that you will get screwed on the exit cost when the market crashes, and I think that this becomes a catastrophe in waiting.

Your profit reflected good luck and good skills, not good positions, if I may be so bold.

Today would be a more reasonable time to sell condors/verticals in my (probably useless) opinion.
 
Quote from optioncoach:

As long as we stay below 1400, normal as been defined by the past few months does not exist for me yet :)
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LOL. I am discovering the deeper zen of "normalcy" as I watched the market drift down into one of my BULL PUT SPREADS on light volume. It was an unexpected and subtle joy to watch the market finally produce normal b/a spreads to offer me a partial loss exit over the full enchilada. Tempting it was...

Right now what I want to know is when the corporate treasurers are going to step in with their mega-billions as the Calvary to buy back these great deals. That would be better than normal right about now to see the bears get caught shorting...

TS
 
Quote from TrendSailor:


Right now what I want to know is when the corporate treasurers are going to step in with their mega-billions as the Calvary to buy back these great deals.
TS
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Do you mean cavalry?
 
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