IT wasn't bad - I got filled at mid pretty quick.
When does a 0 dte SPX stop trading?
- Thread starter klattermusen
- Start date
But I still don't understand this completely.
So tell me now; what strike price did the SPX Aug 18 4255 puts settle at? I cannot pull them up this morning at all. And yet the market is not open. But the SPXW are trading pre-market. How do I see the settlement price of those aug 18 4255s puts (i shorted them)? I guess I want to know how badly I could have screwed up $$.
We don't know where these settled at yet. They are no longer trading and settlement will be based on the opening price of each of the SP 500 component price this morning. The exact number will be posted on the link I listed an hour or two after the opening.
If you were short those puts, looks like it would have been bad. Glad you covered.
There is a lot of risk (and potential reward) trading these AM expiring options as they are difficult to hedge and you can have an extreme print on the settlement price.
Looks like SPX SET is 4258.21
i would have been ok by the skin of my teeth. Again lesson learned. Thank you all.
https://www.cboe.com/index_settlement_values/
i would have been ok by the skin of my teeth. Again lesson learned. Thank you all.
https://www.cboe.com/index_settlement_values/
Yes, it can be confusing. They list Aug 18th as it is the last trading date. You have to know the difference between SPX and SPXW. It's confused a lot of people.
Since this thread addresses SPX 0DTE options, I'd like to jump in here with a few questions.
As I recall, late last year we had a discussion on trading SPX 0DTE options. I think @MrMuppet suggested that, when trading from the long side, you want to look for a strike with the most gamma per unit of theta. At the time, I didn't really know what that meant.
Still learning, but now I *think* it means: You want as much gamma as you can get to overcome whatever remnants of theta decay that is left, and still have some gamma left over to give delta a kick in the butt, which, in turn, would help kick up the option price.
Assuming that is correct, I'm thinking the reverse of that would be true coming from the short perspective: You would want gamma to be <= to theta, preferably less, so that the exact opposite happens.
But if your strikes were far OTM, would that gamma:theta suggestion still apply?
For instance, after looking at what happened overnight and premarket, it didn't look to me like we would see a big move for the day. Keep in mind, I'm not trading options yet, but in a scenario where you believed there wouldn't be a big move, wouldn't a short strangle be appropriate?
ES opened at 4259.25, I think SPX opened a few points higher. Giving SPX 50 points of breathing room to move either way, it seems to me that selling a 4300 call and selling a 4200 put, both expiring today, would be a reasonably good trade. Around 10 minutes after RTH open, it looks like you could have collected around $250 premium, and with maybe a $100 stop-loss, you'd have a risk:reward of 1:2.5.
And wouldn't a short strangle that far OTM (the deltas were like 7 and 8), be exempt from the gamma:theta ratio suggestion?
Or am I completely off base with all of that?
I realize you would have to have the appropriate options trading level approval in order to trade short strangles, as well as satisfy the margin requirements.
Now that I've written all that up, you might not be able to use an appropriate stop-loss on a 0DTE trade. If not, then that type of trade would probably be much too risky.
As I recall, late last year we had a discussion on trading SPX 0DTE options. I think @MrMuppet suggested that, when trading from the long side, you want to look for a strike with the most gamma per unit of theta. At the time, I didn't really know what that meant.
Still learning, but now I *think* it means: You want as much gamma as you can get to overcome whatever remnants of theta decay that is left, and still have some gamma left over to give delta a kick in the butt, which, in turn, would help kick up the option price.
Assuming that is correct, I'm thinking the reverse of that would be true coming from the short perspective: You would want gamma to be <= to theta, preferably less, so that the exact opposite happens.
But if your strikes were far OTM, would that gamma:theta suggestion still apply?
For instance, after looking at what happened overnight and premarket, it didn't look to me like we would see a big move for the day. Keep in mind, I'm not trading options yet, but in a scenario where you believed there wouldn't be a big move, wouldn't a short strangle be appropriate?
ES opened at 4259.25, I think SPX opened a few points higher. Giving SPX 50 points of breathing room to move either way, it seems to me that selling a 4300 call and selling a 4200 put, both expiring today, would be a reasonably good trade. Around 10 minutes after RTH open, it looks like you could have collected around $250 premium, and with maybe a $100 stop-loss, you'd have a risk:reward of 1:2.5.
And wouldn't a short strangle that far OTM (the deltas were like 7 and 8), be exempt from the gamma:theta ratio suggestion?
Or am I completely off base with all of that?
I realize you would have to have the appropriate options trading level approval in order to trade short strangles, as well as satisfy the margin requirements.
Now that I've written all that up, you might not be able to use an appropriate stop-loss on a 0DTE trade. If not, then that type of trade would probably be much too risky.
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Okay... it looks like that type of trade would be a huge gamble. You'd either win and keep all your premium, or you'd face the possibility of unlimited losses.
I'm not even sure if a defined-risk strategy like an Iron Condor would be a good idea.
I'm not even sure if a defined-risk strategy like an Iron Condor would be a good idea.