https://www.cnbc.com/2018/02/06/wall-streets-effort-to-turn-volatility-into-an-asset-class-is-partly-to-blame-for-this-market-chaos.html?__source=twitter%7Cmain
Monthly Archives: February 2018
SVXY
Thanks for all the postings down below. Looks like plenty of patience is going to be required to work our way back. As long as the thing is open and trading we’ll eventually get there.
In my “SVXY only” account I’m short 7 puts that will be at an average cost basis of 97.70 including put premium received. I’m fine with these getting exercised ASAP so call selling can begin.
In other account everything was hedged as either synthetic stock or put spreads. Nothing major and will resume selling calls on these as well.
Looking back I was well aware this thing could go to zero but didn’t think I’d ever see it. Still haven’t decided how I’ll trade it in the future if at all. Having nice success with synthetic stock so plan on doing a lot more of those types of trades.
Good luck everyone!
XIV
Some bad news….50 share lots @ 103.65, 100.50, and 95.50 yesterday. Not much you can say…treat it as a little drawdown and work on getting it back.
EWW
#SyntheticStock – Rolled weekly to maintain positive delta. If the delta approaches zero again I’ll consider booking the winner.
Rolled Feb 50 to Mar 51 @ .10 credit
SVXY
#ShortCalls – Some good news…
Bought to Close SVXY FEB 9 2018 124.0 Calls @ .01 (sold for .80)
Bought to Close SVXY JAN 18 2019 260.0 Calls @ .01 (part of a strangle sold for 6.45 I’ll apply to a 45 strike put basis)
SVXY catching some action in after hours
Up over 1.00 (9%) in what doesn’t look to be connected to VX futures movement (UVXY and VXX are also both up pretty substantially).
SPX calls sold
#SPXcampaign Right after the bell, filled on this:
Sold $SPX Feb 23rd 2775/2800 call spreads for 5.70.
BABA covered call
#CoveredCalls #CoveredCallCampaign #LongStock
Sold $BABA Mar 2nd 202.5 call for 1.75. I was assigned 200 shares on Friday.
UPS #FallingKnife Adding to my…
UPS #FallingKnife
Adding to my July position but dropping down a strike.
Sold $UPS Jul 20 95 put @ 1.60
UVXY is getting crushed
Down over 25%
DISH #FallingKnife Sold $DISH Sep…
DISH #FallingKnife
Sold $DISH Sep 21 32.50 puts @ 1.40 with the stock at 43.56. Delta 15.
BMY
#Fuzzy – BTO BMY Mar23’18 60/60/58 Fuzzy for 2.08. Leaving unhedged for now.
SVXY school
Obviously a bunch of us just got schooled in VXX products, especially SVXY.
Some things I have learned.
1. it can really go to zero and be closed down. Even if cash secured you can still be wiped out so spreads probably make more sense.
2. Most of the time it is going to infinity but can also race to zero. In looking at the news now that I have time, they had a huge margin liquidation (probably a hedge fund having to close) and that is why we closed at 70.81 but gapped down as low as 10. Had they not had to do that we probably would have opened around 70.
3. as soon as we see backwardization probably worth closing anything on the put side. I could have been out yesterday with only minor losses. Now looking at 80% haircut once assigned.
4. The option liquidity dries up and bid-ask spreads become ridiculous with a volatility spike
5. I can work with a big loss, cannot do anything with bankruptcy/liquidation. Things that appear liquid may not be all the time.
6. Somedays better to be lucky than good. Glad they are closing XIV and not SVXY. Hope no one here was in XIV but probably not since must of us are option traders.
7. You can lose money a lot faster than you can make it, even if you know what your are doing.
Now going forward.
1. Once liquidity returns will be selling OTM delta 16 or lower calls to try to reel back in some cash.
2. Once I have recovered enough of my original investment will collar that thing so no wipe out type losses.
3. Stay small, have a lot of different eggs in the basket(s) so no big loss. Have to admit I was getting over confident with the VXX trades. My mostly stock accounts have already recovered.
4. Fortunately not all my expirations are the same day so I can stagger some of the losses and may get to roll some once the options are trading well again.
Hope everyone finds a way out profitably, it will take a while but once back to contango we should be back in the right direction at least.
I will only play these trades now with “house money”.
SPX call spread
#SPXcampaign so at the lows about an hour ago I was preparing to take profits on the Feb 7th 2670/2695 call spread I sold earlier for 11.65. It was down around 6.00. Then I realized I had actually PURCHASED the spread. So I’m now long and liking this rally. Hopefully can close today with small profit.
SVXY calculations
#VXXGame Ok, here’s my thinking. I am short 6 naked options between 75 and 120. I also have two spreads, 30, and 40 points wide. All expire by September.
I have calculated two scenarios:
1. I take assignment on the naked options, and allow the spreads to expire and take the loss.
That would result in a $60,000 cash outlay and 600 shares of stock. So $100 per share.
2. Take assignment of the 6 naked, SELL the longs from the spreads when stock is at 15.00, and also take assignment from the 2 remaining shorts.
That would result in a $63,000 cash outlay for 800 shares, or 78.75 per share.
So #2 is preferred, PROVIDED $SVXY survives and gets its way back at least to 78.75.
Thoughts, anyone?
SVXY Fuzzy
BTO 2020, 10 calls @ 6.60
STO 2020 10 puts @ 4.30
BTO 2020 5 puts @ 1.38
STO Feb. 16, 20 calls @ .18
I hope they stay in Business.
XIV…back from the dead?
Hmmmm….
SPX trades
#SPXcampaign Sold $SPX Feb 12th 2550/2525 put spreads for 3.75.
Also bought this in case of strong move down today or into Friday:
Bought Feb 9th 2590/2570 put spreads for 4.25.
UVXY April
Sold the new highest strike–$UVXY Apr 20 45 call @ 8.00.
XRT rolling to inverted
I was short a Feb 47 straddle which was doing fine until a few days ago LOL. With the stock down below 45 and bouncing a bit, I am rolling the 47 calls down to 45 for .70 credit to go inverted 47/45. Total premium taken in so far is 2.91 so I’m still at a good profit if XRT finishes between the strikes next week. If it keeps moving down I’ll roll the whole position out to March and try to un-invert it.
SVXY
I was looking at buying a SVXY Jan 2020 10/10/5 synthetic stock position and Interactive Brokers was requiring $26,000 margin?? Maybe that’s a sign I should just pass.
Covered SVXY short stock
#VXXGame BTC $SVXY stock for 11.40. This was assigned via a 100 put last March, then it split, so cost basis is 50.00. I covered the other half yesterday at 86.00 (doh!).
I couldn’t figure a reason to hold it. It’s possible this is the low for SVXY so why not cover at best price? By the time SVXY gets back to 100, I will have been assigned 700 shares.
Peter Brandt @PeterLBrandt Good chance…
Peter Brandt @PeterLBrandt
Good chance correction is over in $DJIA, but 15% correction cannot be ruled out. IMO U.S. stock market bears are going will not be pleased with future.
Sold SPX Long sides
#spx
Selling back my Long sides from 2 weeks ago that I held after exiting my short sides on Jan 26..
STC Feb 23 Long 2650 Puts at 11090.00, Bought prev at 2300 prior to Jan 26..
STC Mar02 Long 2650 Puts at 12900, Bought prev at 1440 prior to Jan 26..
The news just said (barrons)…
The news just said (barrons) that XIV is being closed but they are keeping SVXY operating.
SPX
STO Feb23 SPX 2450/2550 bups, for 11.10 credit..stop loss in place.
SVXY call closed
#VXXGame Closed $SVXY Jan 2019 165 call for .05. Sold for for 4.25 (effective price) on July 11th, as half of a 330 call before the split.
So I’m guessing we have to now watch SVXY build itself back up from 11.00? I don’t see how a massive rally will make this thing go up as fast as it came down.
SVXY
The question that I have is, will the fund be in business?
SVXY now open
Opening price 11.70
Feb 6 #fuzzy I used…
Feb 6 #fuzzy
I used the MU rally to liquidate. Liquidated MSFT too. FXE closed for 50% target. Lots of Fuzzy Bear trades today on SPY and QQQ have helped me reclaim over 50% of my YTD profits.
SPY bear: Feb 16 expiration, sell ATM call, Buy ATM put, Buy ATM+2 call. Do not hedge for fast movement with the market. Set a GTC-close so a cover order is in the system. (Tip: the fastest way to create a fuzzy close order is to open your “filled orders” right click on your order and “create opposite order”).
Sue
UVXY call
#VXXGame Sold $UVXY March 70 call for 4.30. Against long 91 calls I bought for .16 last month.
SPX reconciled
#SPXcampaign Okay, after my bonehead trades this morning, I can see we’ll probably be going down more, or at least remain congested.
Sold $SPX Feb 7th 2670/2695 call spreads for 11.65. This was a fat-finger… I mis-entered the price, should have gotten more
Sold $SPX Feb 9th 2740/2765 call spreads for 6.20.
Sold $SPX Mar 9th 2200/2175 put spreads for 1.90…. 440 points OTM.
Yesterday I sold the Mar 9th 2300/2275 for 1.80, and today it’s still 325 points OTM and trading for 4.00 (with very wide bid/ask). Fairly safe bet if you don’t believe this is a market crash.
SPX
STC May18 2900 Long Put, at 300 on the move back down while ago…prev bought on the Friday prior to meltdow Monday..purchased as a Delta 65, sold back as a Delta 90..
As I prev mentioned, the 2590 was a bounce point, at 10% correction levels…Todays low so far is 2593..and bounced up from there..when I see the reversal and bottom on my chart, I’ll start selling put spreads..until then , I’ll watch…
XBI
#Fuzzy – BTO XBI Jun15’18 91/91/88 for 4.50. Unhedged for now. Out of the foxhole, hope I don’t get shot. Is that clicking noises I hear?
VXX long puts
#VXXGame #LongPutDiagonals i entered this trade on Sept 1st when VXX was at 46.08. I bought the $VXX 2019 LEAP 20 puts for 1.80.
Today, VXX is HIGHER (52.00 as I type) and those puts are ALSO higher… mid price about 3.00.
Shows how much volatility drives all prices higher. If I get a chance to buy more under 2.00, I will.
SVXY indicative value
According to Yahoo Finance, is 11.61.
https://finance.yahoo.com/quote/%5ESVXY-IV?p=SVXY-IV
SPX… ill-advised
#SPXcampaign Already had to bail with losses on those SPX call spreads sold earlier. 100-point rally off the open is not what I expected in 25 minutes.
Closed with losses of 8.10 and 2.05.
SPX call spreads sold
#SPXcampaign Fat premium out there for decently far OTM call spreads expiring this week.
Sold $SPX Feb 7th 2675/2700 call spreads for 7.00
Sold $SPX Feb 9th 2700/2725 call spreads for 8.90
SVXY
BETHESDA, Md.–(BUSINESS WIRE)– ProShares, a premier provider of ETFs, announced today the performance on Monday of the ProShares Short VIX Short-Term Futures ETF(SVXY) was consistent with its objective and reflected the changes in the level of its underlying index. We expect the fund to be open for trading today and we intend to continue to manage the fund as usual.
About ProShares
ProShares has been at the forefront of the ETF revolution since 2006. ProShares now offers one of the largest lineups of ETFs, with more than $29 billion in assets. The company is the leader in strategies such as dividend growth, alternative and geared (leveraged and inverse). ProShares continues to innovate with products that provide strategic and tactical opportunities for investors to manage risk and enhance returns.
View source version on businesswire.com: http://www.businesswire.com/news/home/20180206005856/en/
Source: ProShares
UVXY call sold
#VXXGame Sold $UVXY June 55 call for 11.00. This is against long 60 calls I bought last month for .96. I’m being careful to remain in spreads now.
#svxy SVXY has wiped out…
#svxy
SVXY has wiped out my trading account. I will be getting a margin call which I can’t cover. What happens now? (All the rest of my money is tied up in IRA or 401k.)
Thanks for any advice.
Laura
#Fuzzy assignment warning Good morning…
#Fuzzy assignment warning
Good morning everyone! Just want to throw out the possibility that if you have on Fuzzies with deep in-the-money short legs, there might be assignment activity due to margin calls. The higher the extrinsic value in those legs, the less likely–but anything can happen when forced liquidations kick in. Anyway this morning would be a good time to review fuzzy legs, and stay on top of any broker notifications.
Sue
A Good Read
https://mailchi.mp/oneilsecurities/morning-thoughtsshock-and-awe-inverted-vix-halted-no-sht-try-the-potato-and-eggs?e=3e82e082cd
SVXY Scwhab shows trading halted!
SVXY
Schwab shows trading halted!
Blood on the Tracks
The wreck continues….
ES -76 so far
YM -850 thus far
As expected the Asia mkt continued the selling…
VIX Indicator
#VIXIndicator fired an additional SIX warnings today, which is a record for a single day as far back as 2000 (which is the extent to which I’ve measured).
It was the highest level the $VIX has reached since August 2015, and the highest close since October 2011.
Although it was the biggest ever single-day point drop on the DOW, it was only the 33rd biggest percentage drop.
A VIX close below 15.30 would signal the Warning is over (that number will change if we get a new VIX high). But the bottom will occur several days before that signal; the indicator is working well but it can’t pick a bottom!
XIV and SVXY crater
https://www.cnbc.com/2018/02/05/xiv-exchange-traded-security-linked-to-volatility-plummets-80-percent.html
SVXY is at 12.00
UVXY peaked at 36 and already back down to 27.00
But VXX increased to a peak of 64.90, and is back to 55.00 now. That’s DOUBLE Friday’s close. This is what’s causing SVXY to crater, but not sure how the math drove it down to $10.00.
#svxy WOW svxy is down…
#svxy
WOW svxy is down 75 point – I did not see this coming. With the boat weight so short volatility is there any expectation of a bounce tomorrow? I have 100, 90, 70, 60 put sitting out there. ouch. Thanks Laura
Feb 5 #Fuzzy Land I’m…
Feb 5 #Fuzzy Land
I’m a bit shell shocked after these last 2 days. As I watched my January profits approaching a 50% retracement, it was time to liquidate almost everything to protect that level. By end of the day today my Jan profits have retraced 61.8%. An appropriate number for fib aficionados! Fuzzy bear trades brought salve in the way of $7243.00 today. Only a couple Fuzzies remain: MU (x3), MSFT. Added a new long fuzzy on IWM and TLT, and a fuzzy bear on FXE.
I’ve got a family member, C-level exec in a public company, called me 2 weeks ago, wanted me to design a trade for him to protect his employee stock options that he couldn’t sell until April 1. He was not ethically allowed to short his own company. “No Problem” I said, got the perfect trade for you! A 5-lot SPX unhedged fuzzy bear would give him $150K profit in a 10% correction, the trade was really cheap; about $24.00 (Mar29 2800/2800/2805). Tonight the trade costs $211.00. That’s $93,500 profit. Did he do the trade? No (but I didn’t either). Guess who called during the game last night in a bit of a panic. Yep.
Closed Fuzzies for the quarter profits were slashed to $26,584. But I know a LOT of people have lost everything they made in Jan, so I’m grateful that I’m still green for the year. Other than small fuzzy bears for quick flips, I’m really trying to wait for the Face-Ripping rally to set substantial bear trades.
SVXY after hours
Trading in the low 40s.
VIX futures in strong backwardation: 
After hours fill
#VXXGame Bought to close $SVXY June 145 call for 1.75. Sold for 10.00 on Dec 1st. Was trading at 20.00 a couple weeks ago.
SPX long puts sold
#SPXcampaign I bought these this morning (in pre-market) for 2.65.
Sold $SPX Feb 7th 2700/2675 put spreads for 17.00. Fill just before trading closed at 4:14 ET.
A 20K day trade!
Just caught the close, I…
Just caught the close, I know some people have not done well with the drop, but hang in there. This is where the big money is made when everyone else is running for the exits. The optionsbistro group will be there to sell them overpriced insurance policies (options)!
I will be setting up some SVXY/UVXY synthetics once I see a little stabilization.
Will also be rolling options by Wed, out of town at the end of the week.
Good luck!
Good night everyone
See you in the morning.
After hours..
….new lows in /ES and SPY, new highs in VIX
Good luck everyone!
I’ll be out for a lot of the week visiting family. Will be monitoring but not posting much. Letting synthetic weekly sales expire and sitting tight for now. Have fun!
#shortputspread SPY Sold March 16…
#shortputspread SPY
Sold March 16 235/245 for .96
VXX Game
#VXXGame Got antsy and took some profits on the way down… too early!
Bought to cover 100 shares of $SVXY for 86.00. Assigned awhile ago at 50.00. Still holding another 100.
Sold the long put on the $SVXY March 130/100 put spread: Sold 100 put for 23.00. If assigned the stock via the 130 put, it will be at 99.00 cost basis.
Also, just filled for 7.90 on the $UVXY Jan 2019 70 call. That’s 5 fills in one day, each one a dollar higher than the last.
VIX
We are in backwardation by 3.75 points in the front month. I would expect that there were more margin calls on the futures today. The SVXY is diving right now. Only 22 more points to go to get to my level.
SPX puts sold
#SPXcampaign Sold $SPX March 9th 2300/2275 put spreads for 1.85. 350 points OTM!
AAPL ladder
Replacing some current and upcoming expirations in $AAPL. Sold:
Jun 15 130 put @ 1.60
Jul 20 125 put @ 1.40
Sep 21 120 put @ 1.65
SVXY
#SyntheticStock – Taking a nibble at the 80 level for Jan 2019. Averaging down from earlier positions..
80/80/77.50 @ 25.50
Max loss 28.00 with 50 weeks so min sale required of .56. No weekly sale yet…
Low TICKS
According to the TOS ticks, today we had the lowest TICK reading since November 2011.
UVXY
#VXXGame After loading up on short $UVXY Jan 70 calls in the space of an hour… 3.90, 4.90, 5.90, 6.90, I couldn’t resist selling one of my long 75 calls for 6.50. Bought for 1.59 avg price in early Jan.
My account is up today, thanks to the Downside Warning getting me pretty damn short.
XIV
#Stock – Bought tiny lots at 103.65, 100.50, and 95.50. Was hoping for more…
$SPX has bounced 40 pts…
$SPX has bounced 40 pts off the low
Overall…
#SyntheticStock positions actually holding up pretty nicely for now. Take out REGN and SVXY and it’s a flat day in main account. AAPL, AAOI, ADSK, and EWW green today. Crazy!
SPX
#RocketManHedge – Let’s see if this works…rolling my weekly out to end of year and low as possible. Let the hedge ride as long as we are below the 50ma. When it recovers above the 50ma book the big profit on the hedge and start selling calls against the short LEAP put. Position size is what allows this…April hedge is up 85 points with the weekly cleared out…
Rolled this week’s short put to SPX DEC 31 2018 2500.0 Put @ 2.20 credit
SPX
I guess the 50day MA did not mean much in the way of support. The 200 day MA is a long way down from here. Scary.
We’re in the upside down
#Market #SPXcampaign For the last few months we have seen unending rallies, defying gravity. Many mornings we would open with a nice little pullback, getting enough traders worried the happy days were ending so they would sell, then the market turns around and notches another all-time high.
This morning’s “rally” was the reverse of that… Gap-down open, only to perk into positive territory, head faking enough to cover their shorts before we rip down to new lows.
It’s the upside down of last month.
UVXY
#VXXGame – Darn it…can’t resist. Margin free against my short Jan 2020 5 strike puts.
Sold UVXY JUN 15 2018 60.0 Call @ 3.50
SVXY
Another 40 more points on the downside and I back up the truck.
/VX
#VXXGame – Instead of naked shorting UVXY, (I remember 2015 too well) I’m going with this along with the VIX call spreads I’m trying to add to. Going out a couple months where the moves are less volatile.
SOLD /VXJ8 @ 16.05 (April)
SVXY XIV
Pretty impressive drops…just like the good ‘ol days. Tempted to start accumulating some XIV as it drops. Can’t trade SVXY in the 401k…
Options Bistro 