I'm looking for AUG. Not enough time left in JUL.
Vertical Spreads for Aggressive Growth
- Thread starter Cache Landing
- Start date
I'm looking for AUG. Not enough time left in JUL.
Quote from rallymode:
hey hey, welcome back, catch any gold fish?
I'll tell you what. Fishing is great up there! I'd like to go back a little later in the season when a couple of the rivers drop a bit. The fish are monsters up there but really picky compared to the locals here. Pretty frustrating when they are jumping right in front of you and you can't get them to take any pattern you've got. It's like trying to hunt elk with a slingshot. All the better though. That must be why they are so big. I'd like to get up to the Madison sometime. I hear the fishing is great there too.
Today's Action
STO 4 GENZ AUG 57.5/60 p @ 1.00
Year to Date P/L
Account Value: $13,829.50
YTD Gross P/L: 4,365.00
YTD Commiss: 535.50
YTD Net P/L: 3,829.50
YTD % P/L: 38.3%
Looking for biotech to be strong longer term, but there might be a lag for a couple months while the rest of the market runs.
Waiting for SPX to get closer to 1290 before I make a move there.
STO 4 GENZ AUG 57.5/60 p @ 1.00
Year to Date P/L
Account Value: $13,829.50
YTD Gross P/L: 4,365.00
YTD Commiss: 535.50
YTD Net P/L: 3,829.50
YTD % P/L: 38.3%
Looking for biotech to be strong longer term, but there might be a lag for a couple months while the rest of the market runs.
Waiting for SPX to get closer to 1290 before I make a move there.
Yeah, I think many people are of the same opinion I am. A bit of strength short term, but down in the end.
Today's Action
BTC 4 GENZ AUG 57.5/60 p @ 0.45
Year to Date P/L
Account Value: $14,049.50
YTD Gross P/L: 4,365.00
YTD Commiss: 547.50
YTD Net P/L: 3,817.50
YTD % P/L: 40.5%
BTC 4 GENZ AUG 57.5/60 p @ 0.45
Year to Date P/L
Account Value: $14,049.50
YTD Gross P/L: 4,365.00
YTD Commiss: 547.50
YTD Net P/L: 3,817.50
YTD % P/L: 40.5%
Quote from Crucis:
Cache, do you usually look about 45 days forward? I usually work with a 30 day view, less credit that way, but the overall risk is less.
Is your risk management different with 45 days vs. 30 days?
Not necessarily. For a credit vertical I generally won't open a position >45d from expiry though. I generally prefer about 30d. You and I have differing views on risk. But to answer your last question, yes it is different.
One of the 10 theories that economists agree on is that, "rational people think at the margin". They also say that people behave in a manner that is consistent with the idea of "rational self-interest". I would agree when we are talking about general life decisions, but I counter with the idea that in the trading world there are many "irrational" people.
I would extend the idea of thinking at the margin to pertain to writing credit spreads. I don't mind opening a position that is greater than 45d from expiry, AS LONG AS I'M COMPENSATED APPROPRIATELY. In my mind the rational trader is compensated proportionately for an additional amount of risk. In my experience there are a ton of traders that will take on the additional risk without requiring sufficient compensation.
For the position in question, I recieved enough compensation given my forecasts for the underlying. I could have waited another month for theta to eat away at the remaining credit. But remember to think rationally at the margin.....
Today I was sitting on a position that had the ability to return an additional 0.45/contract. In considering whether or not I would open the existing trade under the current situation (aka thinking at the margin), I decided that given my current forecast for the underlying I was better served taking the profits.
So yes, the risk management is very dependant on the present situation. I don't really care what happened in the past. When I opened this position, I didn't expect that I would hold it through expiry. Theta decay wasn't my original goal.