SPX Credit Spread Trader

ryank · Dec 30, 2005

Quote from andysmith:

Coach,

This topics has come up before... does theta decay actually work over the long weekend or has that decay been priced into (spread out over) the number of actual trading days? In other words, does it make a difference whether one sells a credit spread on a Fri versus a Mon? I've heard conflicting answers...

The other day on CBOE TV they were saying the MM's play with IV so you don't really get the 3 day decay over the long weekend. They said it would happen again this weekend with the long holiday, just like last weekend.

ryan

nlslax · Dec 30, 2005

Quote from ryank:

The other day on CBOE TV they were saying the MM's play with IV so you don't really get the 3 day decay over the long weekend.

Did it say what else the MM's play with?

El OchoCinco · Dec 30, 2005

Yeah, MMs play with.... Us!

Quote from nlslax:

Quote from ryank:

The other day on CBOE TV they were saying the MM's play with IV so you don't really get the 3 day decay over the long weekend.

Did it say what else the MM's play with?

More...

ryank · Dec 30, 2005

Quote from optioncoach:

Yeah, MMs play with.... Us!

They also play with t/a, oops, I mean b/a! I heard a Jessica Alba reference on the radio a little bit ago, sorry, mind was in the gutter.

ryan

El OchoCinco · Dec 30, 2005

In the voice of Homer Simpson:

"Mmmmm Jessica Alba.... Arrrrrghhhhhh [drool]"

May have to rent that underwater movie she did recently... lol.

Quote from ryank:

They also play with t/a, oops, I mean b/a! I heard a Jessica Alba reference on the radio a little bit ago, sorry, mind was in the gutter.

ryan

andysmith · Dec 30, 2005

Then when does the 3-day decay actually show up?

Quote from ryank:

The other day on CBOE TV they were saying the MM's play with IV so you don't really get the 3 day decay over the long weekend. They said it would happen again this weekend with the long holiday, just like last weekend.

ryan

nlslax · Dec 30, 2005

According to CBOE TV, it usually is priced into the quotes of the day (today) before a long weekend.

RichardRimes · Dec 30, 2005

Quote from ryank:

Put side not looking so hot though...I should have kept the 1225/1220 but instead got bored and extended it to 1210 so will be watching the free fall closely...Donna,

Your call spread is looking pretty good right now, looks like I may have missed an opportunity (at least short term). I'm at about break even on my put spread with the recent dips. Volume should start to pick up as next week moves along. That should give us an idea as to whether this break down through support is for real or not.

ryan

Synaptic · Dec 30, 2005

Seen this one Coach ?

Quote from optioncoach:

In the voice of Homer Simpson:

"Mmmmm Jessica Alba.... Arrrrrghhhhhh [drool]"

nlslax · Dec 30, 2005