SPX Credit Spread Trader
- Thread starter El OchoCinco
- Start date
Andy,
I spread the use of credit over time and strike as well. I noticed that my profits drops as well as my loss and my stress. When there was time to roll, I did not have time to roll everything.
I missed the move too. For example, I put on only 3 contracts of DEC 1125-1135 and before I can do more, the index moved away from me.
I don't have good answer but just want to share my experience.
-Nick
I spread the use of credit over time and strike as well. I noticed that my profits drops as well as my loss and my stress. When there was time to roll, I did not have time to roll everything.
I missed the move too. For example, I put on only 3 contracts of DEC 1125-1135 and before I can do more, the index moved away from me.
I don't have good answer but just want to share my experience.
-Nick
Phil,
I had closed all my SPX positons on Thursday, but one. 1250/1260.
Today was an expensive learning experience for many.... me included.
I went back and looked at the Friday opens vs. the SET prices. It was mentioned in an earlier post how the two can be quite a bit different. The SET tends to be higher than the open of Friday... significantly higher with respect to the ATR for the SPX.
We're happy to have been able to support Donna on this learning adventure. Hopefully she'll return the favor someday.
Murray
I had closed all my SPX positons on Thursday, but one. 1250/1260.
Today was an expensive learning experience for many.... me included.
I went back and looked at the Friday opens vs. the SET prices. It was mentioned in an earlier post how the two can be quite a bit different. The SET tends to be higher than the open of Friday... significantly higher with respect to the ATR for the SPX.
We're happy to have been able to support Donna on this learning adventure. Hopefully she'll return the favor someday.
Murray
Market closed at 1242 on THU so we actuall had an 11-point SET. But if you use that 10-point rule- close all short strikes within 10 points of index on THU- it will save you from learning future lessons lol.
I was looking at selling the 1245 about 5mins before the close -- it was going for $.70ish. Having learned the above, I now feel like there are times where it pays to buy the nearest OTM call/put depending on the day's bias as a punt. That was a huge pay off today -- 9 pts for a .70 investment. Admittedly, this may be large but I can't help but wonder if there is a strategy worth investigating there...
Remember that the futures were strong this morning and there was some nice gaps at the opening. This is not a consistent event with respect to SET so if you want to look into it, take the index values on the THU before each expiration and then compare it to the historical SET values. I think you will find that the SET has large moves and small moves, both higher and lower and no way to tell for sure which it will be. That is why MM keep prmeium in the SPX strikes as the market closes on THU, because a SET could be large and they are pricing in that risk.
Nick,
Stress, profit, losses -- you're winning on stress and losses -- that's good. But your profits drop too? That's not good, how do you fix that? How about this: since you are putting on smaller positions, how about moving a little closer to the money and increasing the credit?
Stress, profit, losses -- you're winning on stress and losses -- that's good. But your profits drop too? That's not good, how do you fix that? How about this: since you are putting on smaller positions, how about moving a little closer to the money and increasing the credit?