XLF @ $25.70
BTO XLF Jan 2022 15 PUT / 30 CALL long strangle @ $ 1.56 to be financed by the selling of weekly straddles/strangles:
STO XLF Aug 21 $25 short straddle @ $1.02
FAS @ $39.93
BTO FAS Jan 2022 20 PUT / 70 CALL long strangle @ $ 10.28
STO FAS Aug 21 $40 short straddle @ $3.34
It’s kind of like an alternative Pairs trade – I’m pitting XLF against FAS (the 3X long financial ETF). Whichever one is easier to manage in relation to the returns that can be had gets more funds. The other gets cut loose.
Based on the opening trades either I have gone mad or the market makers have gone crazy (and I know the MMs never go crazy!). That relative premium between the core position and the short term sales is outrageous.
Options Bistro 