Jan 12 #fuzzy
Fair question on the last post about risk. I’m always VERY concerned about risk. Being concerned about risk cost me a LOT of money this week. I’m planning to open a shelter for battered hedge sellers. I have a feeling a few folks here will be standing in line with me. I’ve had a wonderful start to the year. Except that I probably lost 20K in hedge rolls this week. But here’s what I’m doing to address risk: I’m closing fuzzies every few $ move up in underlying, taking the profits and resetting them. They are being reset smaller and tighter. Much as I would like to stay unhedged, I just can’t. So my Fuzzies are smaller in size, tighter in spread, and still hedged. So I’m not making as much as my brave hedgeless friends, but I know I can handle a crash. Fuzzy design started for me with $10-wide protection on the puts. Now they are all $3-$5.00. Also by closing and rolling them frequently, the long puts are retaining most of the their value.
The net on my CLOSED fuzzies is now $38,615. So that’s a nice crash cushion.
Current amount of hedges on open positions net collected and sold: 18,770.00
Just some highlights:
1. Closed TGT due to runaway hedges for net $870, but 300% on the core
2. Closed and reset all the Q’s with tighter puts for a net of $4235
3. Closed AAPL for a net of $3300.00 due to older design with $10.00 spread risk
4. New MU Fuzzy on the recent dip, nice weekly premium Mar2 43/43/41 @1.77 w/ 44.5 call hedge
5. New JPM Jun 110/110/105 @ 5.18 with 112 hedge (might be too tight)
6. COST flipped the cards and put on a bull fuzzy here with shored up technicals Mar 190/190/185 @ 5.20 with a 195 hedge due to squeeze and “RAF buy” indicator
7. SPY is all reset with 277/277/274 with hedges
Hey….Remember “SPX Guy?”(ok, maybe not a guy) On January 2? The guy that did the 5000 Risk reversal in SPX? I’ve been tracking that trade just for fun. How would you like $30,975,000 in 9 days.
I’m very happy to have this 3-day weekend! Hoping rest and recharge for all of you, too!