Weekly Pin Butterfly Strategy
- Thread starter caroy
- Start date
I wouldn't say always. I have a hedge type of fly on in VXX that's 44 DTE with wider wings and profit zone. I'm using this journal primarily for weekly fly or weekly expiration trades. Enter a few on Monday manage them through the week. Sell iron fly on the close on Wednesday and if the set-up is there day trade a straddle on expiration Friday. Want to keep track of the trades p/l for a few months and see what I can do with the strategy. I trade some other strategies too. = short cash covered puts, calendar spreads, some ICs. Not a big fan of selling anything naked other than puts I have cash to cover. I've been playing around with the wheel and some covered calls against stocks I like to hold. I trade some futures positions in another account. With those I do mostly trend following using options and layering.
I get in at the MAC D cross shorting a credit spread and then add a long ATM option if it breaks out to new highs or new lows usually with a 30 DTE for the initial spread and then a 45 or longer for the ATM option as I like to give it time to run. Catch a nice one like soybeans and corn and they pay off pretty nicely. A nice hurricane in Florida can knock the oranges off the tree. Pretty conservative with risk management in these positions as my gut feeling is that is a large part of the secret of long-term successful traders. The commodity forum in ET is pretty much dead and no one seems to have much of an interest in them.
In general I'm on here trying to find strategies I like. I'm trading small but want to up the ante when I cash out a business in a few months will scale hopefully 500k to 1MM depending on how it all settles. Trying to figure out the best overall strategy. I'm more of a take the opportunities the market presents rather than force one strategy. Day trading doesn't appeal to me as I don't like having to really be at the screen all day. Flies and options as I think there are plenty of great set ups and potential ways to manage them with pretty minimal risk and good reward possibilities.
I grew up around trading. My father traded large grain spec positions for Bunge, Continental, Bartlett and then traded his own capital until retirement. My uncle was the chief investment officer for a mutual fund. Most dads play catch with you in the back yard mine taught me about TA, crop reports, and COT reports. My dad passed a few years ago from cancer while we were planning to launch a little fund based on his grain seasonal spreading strategies. Miss that guy and our market talks. Didn't care for his right wing political rants and his love of Ayn Rand but mutual respect was there. I read Sheldon Natenberg's Option Pricing and Volatility as a high school kid and my football coach who was a broker in bean options gave me a job clerking in the summers. I worked for a market making group out of college for a year but left to start a career in education teaching and then as a head of a boarding school for a few years. (BA in Philosophy / Religious Studies turned into something.) This was around when the pits were disappearing and the market making edge didn't seem of much use anymore as algo's took over that role. I'd have to learn to take a more directional approach.
So I'm on here to learn, practice, and develop an edge that I'd like to size up when the time is right be profitable and use the winnings (if they come) for something a little more productive than coke and whores. Like to start some employee owned co-ops of a wide variety to test out a few theories in that area.
Looks like I've rambled. Mea Culpa.
Updates before Expiration Friday
Today's Trades:
CHWY closed 98-100-102 call fly for max loss at @ 2.04
CHWY closed hedge adjustment 102-98 put spread @ .03
Final CHWY Loss 1.64 with commissions after initial credit and hedge profits.
SNAP sold Iron Fly 49-50-51 @ $0.79 Credit - hoping for the Pin Tomorrow
Other Open Positions:
DKNG 54-55-56 C Fly trading at $0.30 on the close up $20 so far - Hoping for the ex pin
SNAP Iron Fly 51-54-57 @ $1.59 This one annoys the shit out of me. It was sold on Wednesday's close with the hope of buying it back this morning at 10% max profit Well it opened and traded around the higher OI before having a huge sell off to 50 range where the most OI is. It was profitable at 9:00 AM and was working an order to buy it in @ $1.35 and then foiled by the day job. Fucking Zoom meetings. By the time I looked again SNAP had sold off and it was a loser. Fucked around with rolling down the untested side but figured I'd just sell a new fly mentioned above. This is either a hedge or adding to losers what can I say. I need to stop scheduling monthly employee performance reviews around my trading windows. Kicking myself on this one as I hate when a winner turns loser and it did what I thought it would - pin. See chart below.
Tomorrow looking to exit the iron flies and trade a ATM Straddle. Trying to pick which stock tonight.
And look at how DKNG pinned around the highest OI at 55 today.
Will update after the close tomorrow and do some reflecting on what to change alter going into next week.
Today's Trades:
CHWY closed 98-100-102 call fly for max loss at @ 2.04
CHWY closed hedge adjustment 102-98 put spread @ .03
Final CHWY Loss 1.64 with commissions after initial credit and hedge profits.
SNAP sold Iron Fly 49-50-51 @ $0.79 Credit - hoping for the Pin Tomorrow
Other Open Positions:
DKNG 54-55-56 C Fly trading at $0.30 on the close up $20 so far - Hoping for the ex pin
SNAP Iron Fly 51-54-57 @ $1.59 This one annoys the shit out of me. It was sold on Wednesday's close with the hope of buying it back this morning at 10% max profit Well it opened and traded around the higher OI before having a huge sell off to 50 range where the most OI is. It was profitable at 9:00 AM and was working an order to buy it in @ $1.35 and then foiled by the day job. Fucking Zoom meetings. By the time I looked again SNAP had sold off and it was a loser. Fucked around with rolling down the untested side but figured I'd just sell a new fly mentioned above. This is either a hedge or adding to losers what can I say. I need to stop scheduling monthly employee performance reviews around my trading windows. Kicking myself on this one as I hate when a winner turns loser and it did what I thought it would - pin. See chart below.
Tomorrow looking to exit the iron flies and trade a ATM Straddle. Trying to pick which stock tonight.
And look at how DKNG pinned around the highest OI at 55 today.
Will update after the close tomorrow and do some reflecting on what to change alter going into next week.
Attachments
Outcome Week 1
Weekly Flies
TLT 1:2:1 152-154-156 Calls enter $0.31 exit $0.75 +$0.44
CHWY 1:3:2 98-100-102 Calls enter credit $0.17 exit $2.03 -$1.86
Hedge CHWY 102-98 Put spread enter $0.68 credit exit $.03 +$0.65
DKNG 1:2:1 54-55-56 Calls enter $0.10 exit $0.36 +$0.26
Total P/L - $0.51
Percent Winners 66%
Iron Flies
SNAP 51-54-57 entry $1.59 exit $2.97 -$1.28
SNAP 49-50-51 entry $0.79 exit $0.66 +$0.13
EBAY 54-55-56 entry $0.58 exit $0.45 +$0.13
Total P/L -$1.02
Percent Winners 66%
Straddle
RIOT 26 entry $1.75 exit $0.92
Total P/L -$0.83
Percent Winners 0%
Total all weekly pins -$2.36
Reflections: Learning week. Obviously not happy with P/L losing a couple hundred off the bat sucks. Applying this tuition towards the following lessons. I'm going to widen the wings on m flies and avoid the 1:3:2 unless I have a wider broken front wing to address the R/R. Overcoming my TT orientation that I need to collect a credit when setting up a fly - I don't The pinning phenomenon seems to show an effect. With the iron flies fucked with Snap - my own fault let a winner turn into a loser. When looking for 10% quick am just going to take it and run and not mess around being greedy. Going to enter these more on Thursday's close than Wednesday's for next week. On the straddle bummer. Was hoping this one would bail me out. Bought too early. Wanted some revenge on RIOT. Going to give next Friday's expiration till 9:00 AM or so after the initial vol theta bleed.
Long term hedge with VXX looking better. Have the 42 DTE 16-20-24 1:2:1 bid $1.02
In other effort called away in RIG after running the wheel for a few months hurray. Some puts expired worthless so not a total loss. Week two starting next week with the flies. Stay tuned. Enjoy the weekend.
Weekly Flies
TLT 1:2:1 152-154-156 Calls enter $0.31 exit $0.75 +$0.44
CHWY 1:3:2 98-100-102 Calls enter credit $0.17 exit $2.03 -$1.86
Hedge CHWY 102-98 Put spread enter $0.68 credit exit $.03 +$0.65
DKNG 1:2:1 54-55-56 Calls enter $0.10 exit $0.36 +$0.26
Total P/L - $0.51
Percent Winners 66%
Iron Flies
SNAP 51-54-57 entry $1.59 exit $2.97 -$1.28
SNAP 49-50-51 entry $0.79 exit $0.66 +$0.13
EBAY 54-55-56 entry $0.58 exit $0.45 +$0.13
Total P/L -$1.02
Percent Winners 66%
Straddle
RIOT 26 entry $1.75 exit $0.92
Total P/L -$0.83
Percent Winners 0%
Total all weekly pins -$2.36
Reflections: Learning week. Obviously not happy with P/L losing a couple hundred off the bat sucks. Applying this tuition towards the following lessons. I'm going to widen the wings on m flies and avoid the 1:3:2 unless I have a wider broken front wing to address the R/R. Overcoming my TT orientation that I need to collect a credit when setting up a fly - I don't The pinning phenomenon seems to show an effect. With the iron flies fucked with Snap - my own fault let a winner turn into a loser. When looking for 10% quick am just going to take it and run and not mess around being greedy. Going to enter these more on Thursday's close than Wednesday's for next week. On the straddle bummer. Was hoping this one would bail me out. Bought too early. Wanted some revenge on RIOT. Going to give next Friday's expiration till 9:00 AM or so after the initial vol theta bleed.
Long term hedge with VXX looking better. Have the 42 DTE 16-20-24 1:2:1 bid $1.02
In other effort called away in RIG after running the wheel for a few months hurray. Some puts expired worthless so not a total loss. Week two starting next week with the flies. Stay tuned. Enjoy the weekend.
good point. dually noted.
Trades I'm eying putting on tomorrow for the weekly pin strategy and some rationale behind it for 1/22/21 EXP Am widening the wings based on some reflections from last week.
Weekly
IWM 1:2:1 210-205-200 put fly @ $0.59 - pullback mood in the market and looking for some protection
NIO 1:3:2 56-60-62 call fly @ $0.65- highest open interest at 60 and am looking for the stock to rally
RIOT 1:2:1 26-30-34 call fly @ $0.52 wider wings tied to high OI
Longer EXP
UBER 2:3:1 56-60-64 call fly @ $1.00 loner term play with bigger profit range will look to sell the 60-64 call spread as it develops about $1.00 making it a free fly leaving the balanced 2-4-2 on. 39 DTE
AAPL 1:3:2 120-118-116 put fly @ credit $0.25 - earnings play selling a 1:3:2 put or 1:2:1 broken wing for a credit ahead of earnings to play vol collapse.
Will update tomorrow on entries and prices.
Weekly
IWM 1:2:1 210-205-200 put fly @ $0.59 - pullback mood in the market and looking for some protection
NIO 1:3:2 56-60-62 call fly @ $0.65- highest open interest at 60 and am looking for the stock to rally
RIOT 1:2:1 26-30-34 call fly @ $0.52 wider wings tied to high OI
Longer EXP
UBER 2:3:1 56-60-64 call fly @ $1.00 loner term play with bigger profit range will look to sell the 60-64 call spread as it develops about $1.00 making it a free fly leaving the balanced 2-4-2 on. 39 DTE
AAPL 1:3:2 120-118-116 put fly @ credit $0.25 - earnings play selling a 1:3:2 put or 1:2:1 broken wing for a credit ahead of earnings to play vol collapse.
Will update tomorrow on entries and prices.