Many of us have been trading these to the short side for a long time, but for anyone who needs a refresher, here is a good summary on the pitfalls of being long these 2x and 3x products for any length of time beyond really short term. They can be supercharged if they’re going straight up for example, but in volatile environments they can grind you out.
#SPX1dte Sold to Open $SPX Aug 14th 2845/2865-2965/2985 condors for 1.05, IV: 15.76%, SPX 2923
#tastytradefollow Sold Sept. 20, 20/32/32/38 for 6.23, profitable above 25.75, UVXY currently at 32.50.
#Earnings Sold to Open $TLRY 40.5/44.5/48.5 #IronButterfly for 2.95. Risking 1.00 to make 2.95. This has a decent chance of max loss, but the R/R make it worth the shot. Also, three days for it to return to the middle if it moves far tonight.
#earnings #closing BABA
May 15, I sold a 160/165 put ratio spread with BABA flirting with 180. BABA then flirted with 149. May 31 I started the adjustments, sold a call, ending with an inverted 160 call/175 put strangle. I closed it today with earnings around the corner, making $93, whew.
The next problem is ROKU…
#Earnings $TLRY reports tonight. Below are details on earnings one-day moves over the last 4 quarters, which represent its entire history of earnings reports.
May 14, 2019 AC +0.32%
March 18, 2019 AC -3.39%
Nov. 13, 2018 AC -8.25% Biggest DOWN
Aug. 28, 2018 AC +20.64% Biggest UP
Avg (+ or -) 8.15%
Bias 2.33%, positive bias on earnings.
With stock at 43.00 the data suggests these ranges:
Based on current IV (expected move into Friday per TOS): 38.02 to 47.98
Based on AVERAGE one-day move over last 12 quarters: 39.50 to 46.50
Based on MAXIMUM one-day move over last 12 Q’s (20.6%): 34.12 to 51.88
Based on DOWN max only (-8.3%): 39.45
Open to requests for other symbols.
#PerpetualRollingStrangles BTC $UBER Aug 30th 37 put for 1.50. The 37/43.5 strangles sold for 1.08 on Friday.
Nice thing about these is how small the loss is if your strike is breached. I will allow the call to close for .05.
I will give it a day or two before selling a new one.
#CoveredCalls – Not really an earnings trade but taking advantage of the big premium. Of course sold 30 seconds too early.
Sold NVDA AUG 16 2019 150.0 Call @ 7.25
#CoveredCalls – Out all day yesterday but had one fill.
Bought to Close TNA AUG 16 2019 59.0 Calls @ .10 (sold for 2.70)
Today selling aggressively at the open:
Sold TNA AUG 23 2019 52.0 Calls @ 2.85
Of course 20 seconds after the sale the China announcement (rumor) comes out. Can’t believe people actually believe anything’s going to happen over there.