I was looking at getting into some long NFLX puts if it bounced back off of that resistance at $30 because IV at 40 is super low. But IV is picking up fast and I'm already too -delta to open any long put positions.
Vertical Spreads for Aggressive Growth
- Thread starter Cache Landing
- Start date
I was looking at getting into some long NFLX puts if it bounced back off of that resistance at $30 because IV at 40 is super low. But IV is picking up fast and I'm already too -delta to open any long put positions.
Don't want to jinx myself, but it definitely didn't feel too bad to be overall -delta today. The IV increase is working against a couple of my spreads but I'm not worried about that yet.
On that topic though, I'd like to pose another question;
Under normal circumstances, when the underlying moves up, IV typically decreases. The opposite is generally true for a downward move in the underlying.
If a bear call is chosen it will profit from a downward move in the underlying, but it will be hindered by the accompanying IV increase until expiry. So, most positions must be held for a worthless expiration. On the other hand, if the underlying moves against you the IV drop should help to limit the damage somewhat.
If a bull put is chosen it would profit from an upward move in the underlying, and also from the accompanying IV drop, so profits might be captured more quickly. But , with an adverse move in the underlying, the IV increase will only enhance the loss and make adjustments more difficult.
I'm interested in everyone's preference. Bear call so an adverse move will be more adjustment friendly? Or bull put so profits might be captured sooner?
Granted there are times when IV is at a low or high and doesn't follow the rules. I'm only referring to situations as described above.
I wasn't able to update the journal earlier today as I do have a "real" job. but I took the opportunity to reverse the AAPL trade. I have consistently misread this issue.
Anyway, I bought back the short leg at the end of the day today. I've got a trailstop in on the long leg so we'll see how it moves tomorrow morning. I don't imagine I will be in for much longer before the stop is hit. I'm looking for a bit of a correction tomorrow so that I can come close to break even.
(I'll update the account PnL when I close out the long leg. It's easier that way.)
Anyway, I bought back the short leg at the end of the day today. I've got a trailstop in on the long leg so we'll see how it moves tomorrow morning. I don't imagine I will be in for much longer before the stop is hit. I'm looking for a bit of a correction tomorrow so that I can come close to break even.(I'll update the account PnL when I close out the long leg. It's easier that way.)
Looking to open a position in AMD. We'll see if the price action is favorable.
Long or Short?
Bearish, but couldn't get filled as it was dropping this morning.
[edit]I was a couple days late finding this one. I didn't show up on my radar until last night when I should've found it two days ago.
Today's Action
BTC 4 AAPL APR 65p @ 4.60
STC 4 AAPL APR 62.50p @ 3.60
Year to Date P/L
Account Value: $10,899.50
YTD Gross P/L: 1,090.00
YTD Commiss: 190.50
YTD Net P/L: 899.50
YTD % P/L: 9.0%
Legged out of AAPL bull put for a net profit of $36. Disappointing, but at least I was able to eek out a little more than commiss.
BTC 4 AAPL APR 65p @ 4.60
STC 4 AAPL APR 62.50p @ 3.60
Year to Date P/L
Account Value: $10,899.50
YTD Gross P/L: 1,090.00
YTD Commiss: 190.50
YTD Net P/L: 899.50
YTD % P/L: 9.0%
Legged out of AAPL bull put for a net profit of $36. Disappointing, but at least I was able to eek out a little more than commiss.
Yeah, that's why I bailed. I opened the position when that critical resistance point was a critical support. Once it fell through I was just waiting for a good time to get out. It came with yesterday's rally. I'd considered a bear call, but I think I'll wait until the resistance holds this time.
