Bought to open $VXX Jan 2019 20 puts for 1.80
Sold to Open VXX Jan 2019 50/60 call spreads for 2.23
Net credit: .43.
I traded 10, so profit near expiration should be about $10K.
Max risk just under 10K if VXX soars above 60 and doesn’t come back down. An extremely unlikely scenario.
I’m on portfolio margin, and due to other VXX, SVXY and UVXY position, I was actually credited margin back for this trade. How much this may strain my buying power during a big correction is up to my broker.
I don’t think I will be buying a safety call as @fuzzballl does, but I will consider it. Also will consider selling weekly puts to increase profits.