SPX Credit Spread Trader

I could do that. I do not trade or flip the CEFs so it would not really be a trading journal but I could dedicate it to discussions of CEFs. I definitely do not want this thread to get off topic so that may be the best way since there is enough interest. Also, instead of getting back into my newsletter I could simply place the suggested funds in that thread and leave it for discussion.

I will look for past information to post and I will create a new thread on Closed-End Funds which will work in conjunction with this thread. I will post my criteria and profit/income goals there and post my monthly picks (CEFs are long-term holds so I am not doing a Cramer of daily picks or lightening rounds- if you have a lot of cash then you add 2 or 3 a month and then just monitor them, buy and forget until stop loss is hit.).

Phil

Quote from skanan:

Coach,

What do you think about starting this in a new forum just for discussing about CEF ? I think we can all help do the research and post our favourite funds. That might make it easier to follow and won't clutter this forum.

Nick
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Coach:

Do you trade calendar spreads, and if so would you be willing to post say one trade a month. I don't know about others, but I wouldn't mind diversifying a bit out of credit spreads.

Your call of course, just some ideas :)

Thanks.
Quote from optioncoach:

I could do that. I do not trade or flip the CEFs so it would not really be a trading journal but I could dedicate it to discussions of CEFs. I definitely do not want this thread to get off topic so that may be the best way since there is enough interest. Also, instead of getting back into my newsletter I could simply place the suggested funds in that thread and leave it for discussion.

I will look for past information to post and I will create a new thread on Closed-End Funds which will work in conjunction with this thread. I will post my criteria and profit/income goals there and post my monthly picks (CEFs are long-term holds so I am not doing a Cramer of daily picks or lightening rounds- if you have a lot of cash then you add 2 or 3 a month and then just monitor them, buy and forget until stop loss is hit.).

Phil
More...
 
Quote from optioncoach:

I have a bunch of criteria but basucally I look for at least 6% yield, monthly dividends and trading at a discount. All that monthly income is good for the portfolio and the gains and losses in the CEF share prices pretty much cancel each other in most cases, but usually add another 1 - 3% on top of the 6% yields.

Phil [/B]
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Hi Coach,

What do you mean by "add another 1-3% on top of the 6% yields"? Those price changes can result in capital losses and might lessen your overall realised yield. How much is the total average yield over a period of years that you have achieved with your CEF investments? And do you do this by holding the portfolio or by timing it a few times a year?

Thanks
 
The point is that if you diversify your CEF holdings then you greatly reduce risks of net negative share price returns, espeically using the stop loss I discussed. that means in addition to the income yield you could also get additional returns from share price appreciation. Of course the net share price appreciation of all your funds could be negative, that is why the stop loss is so important to protect the main purpose, income yield. CEF selection and diversification are crucial to produce consistent income. In the last 3 years I have produced a net 7 - 10% on average yield on my CEF positions (dividend and share price returns netted together). The effect on your total portfolio depends on what % are in CEFs.


Quote from LoosenUp:

Hi Coach,

What do you mean by "add another 1-3% on top of the 6% yields"? Those price changes can result in capital losses and might lessen your overall realised yield. How much is the total average yield over a period of years that you have achieved with your CEF investments? And do you do this by holding the portfolio or by timing it a few times a year?

Thanks
More...
 
Sorry, I rarely trade calendars so not the best person to discuss em...

Quote from rdemyan:

Coach:

Do you trade calendar spreads, and if so would you be willing to post say one trade a month. I don't know about others, but I wouldn't mind diversifying a bit out of credit spreads.

Your call of course, just some ideas :)

Thanks.
More...
 
Coach,

Great thread...thank you for starting this!

I'm in a bear call spread 585/595 on the OEX, out to DEC. Over the last couple days, the OEX has settled in the 565-8 range. I am a bit nervous as I suspect the market will be heading north as per the MACD. Any suggestions for hedging and what do you see happening technically over the next 4 weeks.
 
Rdemyan,

Funny you mention this -- I'm taking a hard look at calendars and calenderized credit spreads (diagonals). Many people shy away from calendars because credit spreads/iron corndors are, on the surface, so much simpler, and because calendars have an element of the unknown (roll value).

The reason I'm looking at calendars is because the VIX is 11+ and I believe it's going to get higher in the near future. In October the market showed that VIX was capable of popping into the high teens at short notice. I say this is akin to skirting around in a hovercraft on the Amazon where 20 foot alligators lurk under the surface.

Coach doesn't trade calendars and I gues we should not pollute this thread with calendars. Can someone sign up to mentor a calendar thread? Momoney?





Quote from rdemyan:

Coach:

Do you trade calendar spreads, and if so would you be willing to post say one trade a month. I don't know about others, but I wouldn't mind diversifying a bit out of credit spreads.

Your call of course, just some ideas :)

Thanks.
More...
 
Wow, can't believe I'm doing this, but here's your calendar thread. Anyone with ideas!?

http://www.elitetrader.com/vb/showthread.php?s=&threadid=58716

Quote from andysmith:

Rdemyan,

Funny you mention this -- I'm taking a hard look at calendars and calenderized credit spreads (diagonals). Many people shy away from calendars because credit spreads/iron corndors are, on the surface, so much simpler, and because calendars have an element of the unknown (roll value).

The reason I'm looking at calendars is because the VIX is 11+ and I believe it's going to get higher in the near future. In October the market showed that VIX was capable of popping into the high teens at short notice. I say this is akin to skirting around in a hovercraft on the Amazon where 20 foot alligators lurk under the surface.

Coach doesn't trade calendars and I gues we should not pollute this thread with calendars. Can someone sign up to mentor a calendar thread? Momoney?
More...
:p
 
well...after completely wasting my sat am reading journals (not yours of course gator or nick...that other guy) I need to update my spx...Nov is not yet over for me (although I did start Dec with a 1285/1300 call spread for .55)

11/11 sold 1245 (currently have 1250 long)...for 1.30 (accidently gave .10 to the man because I hit send before adjusting from the natural to mid...got to stop being so trigger happy) monday will look to open an new put spread so this will be my second IC for Nov..depending on how the mkt opens the put side will be 1215/1200 or 1220/1210or1205. Ideally would like to be about 15points from the set of Fridays weekly which was 1231.7

While this is agressive it is only greedy if the mkt goes nuts:D
 
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