Busy week away from the market again but still adding an experimental position on UVXY. Low risk high reward playing it’s long term downtrend. Reverse Whiz style.

#LongPutDiagonals #SyntheticShortStock – I’ll be adding a similar position on VXX after the split next week. I’ll let ’em race each other down and see what works the best.

BTW…TDA portfolio margin for this trade is only 2600 increasing to 4000 if UVXY doubles overnight…

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Synthetic short stock with disaster long calls (17.75 debit)

Sold UVXY JAN 18 2019 30.0 Calls
Bought UVXY JAN 18 2019 30.0 Puts

Long call for possible disasters capping potential losses:

Bought UVXY JAN 18 2019 40.0 Calls

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Weekly put sale against synthetic short stock to really boost the profits on this trade:

Sold UVXY AUG 25 2017 29.0 Puts @ 1.25

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The plan:

Sell weekly for the next 74 weeks and let the thing decay. Hopefully capture 10 dollars of the move from 30 to 10.
Once I get a little profit under it I’ll reduce the size or possibly eliminate the disaster calls so I’m only treating those as a temporary expense. Once I remove the disaster calls and get some of that debit back I don’t see how this thing can’t make any less than 100 points per spread with very little stress and risk.