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Blazin

Blazin

Creative Title
<Nazi Janitors>
6,958
36,165
So I sold the 600 shares of SPY Yesterday, my main goal here is to try to gain some further alpha on the market, not avoid any downside. Today I sold 3 SPY put contracts expiring tomorrow with a 445 strike for $1.50. Holding the other half back to see things behave in the final hour.
 
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Sanrith Descartes

Sanrith Descartes

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<Aristocrat╭ರ_•́>
44,637
121,070
Blazin said:
It grows the size of your trade, either via time or $. So it doesn't become oversized I would pick time. Issue with this strategy is that you don't get out unless it recovers. I'd shoot for a strategy that lowers the strike even if that means more time. So you have March expiration still at $20 strike?

Assuming yes, they are currently trading at around $11.80 that means a very high delta, there is no premium left in that option. So you have no theta decay working in your favor because they are too deep in the money. Looking at options chain you are in a tight spot because there is no way to get into the juicy premium without getting closer to the strike and you can't do that unless you realize part of this loss, ie you roll them into a lower strike and pay the $5-6/contract now.

This still could potentially get you out of the trade with near half the loss, without the stock recovering that much. If you want to avoid taking the stock and manage the option position you have to over the months continue to make sure you have a lot of premium in the option and not just sitting in a .94 delta position because at that point you should just hold the equity and sell calls.
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I forgot about the Delta. Thats why I wasnt seeing much time value the further out I looked. Me R dumb. PArt of my is also tempted to just close out the puts, take the loss and buy the shares down here and at least I can make some coin with covered calls.
 
Blazin

Blazin

Creative Title
<Nazi Janitors>
6,958
36,165
Sanrith Descartes said:
I forgot about the Delta. Thats why I wasnt seeing much time value the further out I looked. Me R dumb. PArt of my is also tempted to just close out the puts, take the loss and buy the shares down here and at least I can make some coin with covered calls.
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Because it was a trade for you, it may be one to just take the loss on. Because we are in a decline more likely to find a good home for the money. It's either that or take the share and just start the grind of selling calls and hope it doesn't pop 30% on some earnings report. I don't think any of these names are going to get beyond 10 P/S anytime soon, so it would take strong revenue beats and forecasts to get it moving.
 
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Sanrith Descartes

Sanrith Descartes

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<Aristocrat╭ರ_•́>
44,637
121,070
Blazin said:
Because it was a trade for you, it may be one to just take the loss on. Because we are in a decline more likely to find a good home for the money. It's either that or take the share and just start the grind of selling calls and hope it doesn't pop 30% on some earnings report. I don't think any of these names are going to get beyond 10 P/S anytime soon, so it would take strong revenue beats and forecasts to get it moving.
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Thanks. When it looked like we bottomed it was worth holding it but if we are retesting lows what is left of the cash might be better allocated elsewhere.
 
Sanrith Descartes

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<Aristocrat╭ರ_•́>
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MP
Dont know if its true or not but it would explain how MP was able to turn a profit in this location where everyone before them went bankrupt trying.

1643917934344.png
 
Sanrith Descartes

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<Aristocrat╭ರ_•́>
44,637
121,070
I am almost tempted to lower my FB limit because I am sure the last 10 minutes gonna be a bloodletting across the markets.

edit: too late. Filled at $237. PS.. this was dead in the middle of the trade range I outlined before the open.
 
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Sanrith Descartes

Sanrith Descartes

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<Aristocrat╭ರ_•́>
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Someone just bought 15,000 SPY puts way out of the money for 1 penny expiring Monday

1643919955136.png
 
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