Jeff 6:44 am on Tuesday, April 12, 2016
Tags: ContangoETFs ( 446 )

too deep in the NUGT

After dumping ZSL completely and scaling back on KOLD, NUGT became my favorite son, but I got a bit too deep in the calls. Plus my broker turned up to 11 the margin pressure on these overnight, so I had to dump four under water calls at losses. #ContangoETFs

Example, BTC Apr 29th 105 call for 3.60 released $7K in margin.
Also BTC Apr 8th 85 call for 5.00
BTC Apr 15th 80 call for 7.50
BTC Apr 29th 100 call for 4.40

Total losses only $1K as these were sold for decent premium. Easy to start building back with puts, which also reduce the margin.
STO May 6th 55 put for 2.00
STO Apr 22nd 70 put for 3.30

vxxkelly 7:13 am on Tuesday, April 12, 2016

Feel for you Jeff. I didn’t have any margin issues, I had a self imposed issue. With the massive run again yesterday, $NUGT became too large with a significant impact on buying power. This morning on the weakness, I closed out my May 6, 13 and 20’th $95 calls, took about a $3K loss but had a positive $55K impact on my buying power. Will make that $ back over the next few weeks. I want to make sure that I have $ available to sell $UVXY calls if the market turns south. If the market does turn south, Gold might also spike higher taking up even more of my available funds, so I’m going to get smaller in $NUGT. It is just takes up soooo much capital. If opportunity arises, I’d rather trade $UVXY. I was intending to get smaller over the next few weeks with positions expiring, but this latest move is forcing me to be a bit more aggressive in the reduction plan. What I have in my favor is that all but 1 position I have on expires in the next 3 weeks, so short of another massive run higher,

STO Apr 22 $120 calls @ $.85
STO Apr 22 $110 call @ $1.40
STO May 13 $120 call @ $3.80