BTO KR Jul 20 24/24/22 1.14 #Fuzzy
Un-Hedged at this time
Tag Archives: Fuzzy
Mar 11 #Fuzzy Land +…
Mar 11 #Fuzzy Land + how to make $700 the easy way
Hi Bistro Buds! Last week was a bit of a roller coaster huh? On Thur, before NFP, some technical health indicators I use looked a bit weak. So I took profits on all the index #AtomicFuzzy hedges and closed 1/2 of the core positions. Little did I know what a smart move that was. Remember the Atomics have a double size hedge, so the double hedge covered all the losses on the 1/2 core, then set up the remainder cores for the big move up on Friday. I got lucky, but I try to only get lucky once, then it goes in the tool box for future intentional moves. I realized what an important trade the Atomics are for high volatility, however because they are more expensive, the profit targets need to be tighter. The double hedge in the Atomics accommodates higher volatility, but when profits appear, they need to be taken quickly since profits will appear in declining volatility–which affects the protective legs of Fuzzies.
Friday I took off almost all of the Atomics, and replaced them with regular unhedged #Fuzzies that are free to fly in a “risk on” environment. The price of April Fuzz’s has come down by over 30%. Indexes are my focus. I also took the opp, in a still-elevated vol environment, to put on some of my favorite 20DTE 25/23 delta SPX bitties.
We received our very first 1-Standard Deviation up move on Friday since the big down moves aged off. I think everything is looking rosy. I’ll be watching carefully for follow through early this week on market activity. The closed Fuzzies for the quarter has a 5-figure 35 handle now.
Oh I almost forgot….”How to Make $700 Easy”…. On Monday after hours when the market tanked on the Cohn announcement, I bought TEN TEENSY shares of AMZN. I thought it was ridiculous….how could 10 tiny shares help me in any way? Well…you know the answer to that now. This is going in the toolkit.
Good trading this week for everyone!
Sue 🙂
SPY STC 274/274/272 Feb 12…
SPY STC 274/274/272 Feb 12 was a big loser after recent drop. 188.50 Profit after Comm #Fuzzy
#Hedges They kill a good…
#fuzzy MCD Yesterday as MCD…
#fuzzy MCD
Yesterday as MCD recovered, rolled March 9, 155 call to April 20, 160 for 1.42. My fuzzy is in September.
MCD
BTO May 18 MCD 155/155/150 3.60 #Fuzzy Un-Hedged at this time
#pietrades First positive week since…
First positive week since the SVXY melt down Feb 5-6, 2018, so that is a good thing. I think the bleeding finally stopped, only 1 more contract I can be assigned on at any time.
If I can keep making the same amount each week (unlikely) only 33.3 weeks to get back to all time highs but about half that to get to even (cost basis). What I lost was mostly house money but it was enough to buy a real house 😦 ouch!!
LNG rolled this week 54 CC to 2 week 55 for 0.45 credit. Cost basis now 54.2 after being assigned the 55.5 put last week. Next roll down should result in a profit anywhere around 54.
Unless a major move tomorrow I expect to be called out on (hopefully there are no stupid tweets!)
FAS 66, 67, 68 CC
MAR at 138
NSC at 140
GM 42.5 put. Taking stock, can’t roll it anymore for a credit so will take it and sell CC. Missed the dividend, I think it is today.
Have finally finished taxes and full year review. Based on what won and what lost going forward my trading plan is contracting dramatically to only 4-5 trading tactics.
1. #pietrades
2. #spycraft and credit spreads with the new adjustment technique
3. #fuzzy and maybe try a few #atomicfuzzy
4. put ladders with fuzzy adjustments if they go the wrong way
5. VXX put debit spreads after volatility spikes
Everything else worked until it didn’t and either was flat but required lots of trades or worked really well until it blew up. Goal is to recover what I lost, then keep weekly income coming in, and most importantly do not lose any money again!
Hope everyone has a good close to the week, too busy tomorrow to check in.
UPS
#Fuzzy – Decided to close this short dated Fuzzy down with some green. Not much time left to do damage control with the threat of what could happen with tariff talk, the jobs number, and an upcoming Fed meeting. STC UPS Mar29’18 108/108/106 fuzzy and BTC UPS Mar09’18 109 calls. Figure in the commissions and the trade made 0.82 per contract. Light green is better than red! Thanks to @mortlightman for the idea!
XBI
#Fuzzy – XBI tried to blast off earlier today and it pushed my Fuzzy+hedge into negative delta so I closed it down. BTC XBI Mar09’18 93 calls and STC XBI Jun15’18 91/91/88 fuzzy. Netted 1.96 per contract, trade has been on for 1 month. Looking to reload on a pullback!
#pietrades and #vxxgame Looking at…
#pietrades and #vxxgame
Looking at the new structure of SVXY, it will take decades for it to get back to 100 (just my opinion) so rather than sitting on dead money, I closed out all my SVXY stock from 12.34-12.40 at large losses no longer just a paper loss. But that is so I can use what’s left to make some money back. It will take about 2-4 years to get back to where I was if I can avg. 50% returns, slightly less if I can do better. Unfortunately one of the disadvantages of going back to small accounts is you lose the leverage, especially on non-margin accounts so I am having to be more conservative. I still have one contract of SVXY at 50 for Jan 2019 that has not been assigned. Hopefully they will wait…..it was easy money while it lasted but I think we all have a better understanding of the risks in SVXY now!
At least I only trashed 2.5 accounts this time, in 2015 it was my main trading account so at least not as bad as then on a percentage basis. On a dollar basis it was more 😦 though.
With that in mind and some of these orders are still working but should go through.
1. FAS 68 CC this week for 67.15
2 FAS 66 CC for next week at 65.11
3. WDC 87 CC for next week for 86.09
4 LNG CC (assigned over the weekend at 55.02 cost basis) 54 CC at 0.4 cost basis now 54.65
$765 in premium for 12 days, far away from what it used to be but all of these have a little downside protection in them and should not go to zero like SVXY could. Bringing some money in every week is better than a loss or having it just sit there.
Will add some long term #fuzzy in a few weeks as they can have 100% returns on capital over a year.
MU
#fuzzy #shortcalls MCD On Feb….
#fuzzy #shortcalls MCD
On Feb. 22 I stated that MCD had stabilized following a drop after earnings and entered into a Sept. fuzzy. MCD went up a couple more days and promptly dropped about 15 more points (the 155 long put looks really good right now). Today, sold a March 9, 155 call for .27, MCD is up to 150.
March 2 #Fuzzy Land: Self…
March 2 #Fuzzy Land: Self Assignment
Hi Bistro Friends! I did a #SelfAssignment on MSFT today, converting naked puts into an #AtomicFuzzy. I really like selling 3-4DTE naked puts on MSFT on dips. Been doing it for 18 months it seems, with assignment always assumed but never realized. Today finally was the first chance for assignment. So I chose to do self-assignment into an #atomicfuzzy.
Original trade: STO MSFT Mar 2 94 puts for .72 closed for 1.90, loss: $1118
Atomic Fuzzy: BTO MSFT Apr 92.5/92.5/90 x10 w/ 95/97.5 Call spread for -.80 x24
A move to 94 can get me back to even with a fraction of the risk vs. taking stock assignment. There’s a hockey-stick graph above that for gains.
Atomics have become a big focus for me. I partitioned funds last week for a “hedge fund” type approach to them. Timing may be off a bit…but serious testing is in progress. I haven’t said much about this, but I think there is a ton of edge in these trades….just working on proving it out now. Even though they have nice risk control, they still need a rising market for performance. So, just laying in wait now for that to happen. I was able to take a lot of profits on previous Atomics last week. The CLOSED fuzzy profit for the quarter is now $32,994. But, I’m under water on my newest fuzzies. I was able to use #FuzzyBear trades this week to gain a few k’s.
I had a bit of an epiphany this week regarding a previous post I did that showed we need 3-of-5 one standard deviation up moves before a rally can be trusted. I’ve been watching every single day for even a 1 standard deviation up move and we haven’t had it. I realized that the huge SD down moves tamp down any further SD’s until they age off the averaging. So there’s a coincidental relationship between what I thought was 3 1-SD up moves and the big SD down moves aging off. What I thought was a wait for 3 1SD up moves was probably actually a wait for the big SD to age off, which gives it time to retest lows while waiting. Anyway….if any of this makes sense to you, welcome to my brain. The big SD down moves age off my system in the next 2 trading days. Then there should be more realistic SD data to evaluate.
Have a great weekend everyone!
Sue
SLB, UPS
#SyntheticStock – STO SLB Mar09’18 67.5 calls for 0.28
#Fuzzy – STO UPS Mar09’18 109 calls for 0.32
XBI
#Fuzzy – STO XBI Mar09’18 93 calls for 0.5. My core position is in June’18.
UPS
#Fuzzy – Had a fill while I was out today, BTC UPS Mar02’18 109 calls for 0.05, sold for 0.43. My core position UPS Mar29’18 108/108/106 Fuzzy is currently unhedged.
SQ
BTO 21 SEP 18 46/46/44 CALL/PUT/PUT 5.97 with stock at 45.98. Need 0.28 per week to cover so STO 9 MAR 48 CALL 0.67 #syntheticstock
XBI
#Fuzzy – BTC XBI Mar02’18 95 calls for 0.04, sold for 0.48. Waiting to sell calls for next week. My core position is XBI Jun’18 +91calls/-91puts/+88puts, bought for 4.50. So far have booked 1.26 in net premium on 10 contracts.
Bad news for being long SVXY
Bad news for those of us holding and hoping with SVXY
#VXXGame Starting tomorrow, $SVXY will be -0.5x and $UVXY will be +1.5x
http://www.tradingvolatility.net/2018/02/svxy-and-uvxy-to-be-re-purposed-feb-28.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+TradingVolatility+%28Trading+Volatility%29
MU
BTO Mar 23 47.5/47.5/45.5 1.89 #Fuzzy
Un Hedged Earnings Mar 22
hcgdavis, back on January 26,…
hcgdavis,
back on January 26, 2018 you mentioned a repair trade on SWKS using a put based #fuzzy. Could you please post the trade and the repair? I am trying to learn how this works. May save my bacon some day.
Thank you. Mike
FSLR TLT SPX
A years worth of trading…
A years worth of trading and learning condensed into as few lines as I can write.
Had 5 days off to go skiing but was 70 on Wed and raining since, not good for skiing so am getting my taxes done early this year. I review every trade from the previous year so here are some lessons I learned, a few of them the hard way.
SVXY was my biggest winner until it became my biggest loser. Don’t hold unhedged short volatility. Probably better to use spreads or just buy VXX puts. Even if I had just left the #fuzzy would have limited my losses to 5 k.
#pietrades are very effective but occasionally get one that you have to roll for a long time and ties up a bunch of capital. You can eventually roll it for even or a profit but I think there may be a better way to avoid that but have not discovered it yet. I will be looking for the happy medium between tasty trade 45 DTE and 1 week with #pietrades to see if I can avoid having to roll as much. Recent segment on tasty trade says 30 DTE may be between them. Maybe I will start some positions there on Monday.
https://www.tastytrade.com/tt/shows/market-measures/episodes/shorter-duration-or-managing-earlier-01-12-2018
Managing winners really is more important than trying to save a large loss. Had I just closed SVXY at the end of the day when we were sitting at 70 I would have broken even. Instead now have 70-80% to make up loss.
Diversification is good, but once above about 10-12 tickers, tends to water down returns. I will be trading the same names a lot more this year.
CC can make more than naked puts because of the additional capital gains and skew built into some names. I will be doing more balance between CC and put sales.
#fuzzies are a good way to recover a position that really went the wrong way. Less capital at risk and if set up with a hedge limited risk. However, they take a while to repair a really bad trade. Months in some cases.
As much as I try and have the tools, I just can’t make directional trading work for me. Don’t have the time when I am at work and when I am at home don’t want to sit in front of a computer. However, timing the option sales improves returns and winning percentage. Will sell options more often at the pivot points going forward.
Selling options beats the crap out of any other trading strategies I have tried over the years. All my good trades (except SVXY) started with an option sale as the beginning of a position.
Look at positions instead of a trade. You may lose on sales the first 4 weeks but with recovery eventually can get out with a profit.
Weekly options make adjustments a lot easier.
My fellow bistro’ers gave me a lot of ideas that ended up being profitable. Thanks! 🙂
#spycraft also works and thanks to @jeffcp66 for showing me how to roll credit spreads, however, make sure it is in an account that can handle that. Tradestation cannot which is where I was trading those and with the run up the call sides were taken out but they would not let me roll. TOS fine so will be firing up some spy trades again soon with the TOS accounts.
Keep the ideas rolling, looking forward to trading with everyone again this year and maybe we keep a 2 sided market for a while 🙂
MU
#Fuzzy – STC MU Mar16’18 44/44/42 Fuzzy for 2.57, bought for 0.76.
BTC MU Feb23’18 45 calls for 1.17, sold for 0.31.
This ticker took off this morning plus March is just around the corner. All said and done made 0.91 on 10 contracts.
#fuzzy MCD My contribution to…
#fuzzy MCD
My contribution to the fuzzy world. MCD appears to be coming back from an earnings drop and the correction.
September 165/165/160 for 717, sold March 2, 165 call for .30
SPY
BTO Apr 271/271/269 Long #Fuzzy 5.57
STO Apr 280/282 .54 2x #atomicfuzzy
Feb 21 #Fuzzy Land Hi…
Feb 21 #Fuzzy Land
Hi there everyone! It’s been a couple days since I’ve posted, but I didn’t want to bore you with the same trades. As it turns out, I’m really liking the #AtomicFuzzy! The built in hedge is working really great this week. I was having problems sleeping over the weekend, when I can’t sleep I plan out trades in my head. The first trade I mapped out was a series of laddered SPY fuzzies in Apr/May/Jun, unhedged, totaling 250 contracts (across multiple accounts) when fully built. This would equal 25,000 shares of SPY, total risk approx $175,000, with about $87,500 profit on every $5.00 up move in SPY (assuming .7 delta). That was a fun dream. The next night I designed the same trade but as an Atomic Fuzzy. 250 contracts, risk is now aprox $87,500, and a $5 move in spy = $43,750 (assuming .35 delta).
I’ve got Atomics now on SPY, QQQ, TBT, JPM (based on #UOA today–Mar 120 calls). 45 SPY contracts, 40 in QQQ. I won’t be adding anymore unless I can get some good strike diversification.
Q’s: May 166/166/164 @ 5.86 170/175 Call Credit Spread @ 2.00 double size.
SPY: Apr 272/272/270@ 5.91 278/283 Call Credit Spread @ 1.69 double size.
There’s a chance we’re entering a range bound market here for awhile, meaning I will need to be opportunistic on taking profits, vs if we are in a trending market (that’s another reason why I went heavy on Atomics vs Unhedged). But I am trying to set up longer term trades that require little management. I do realize that SPY and Q are heavily correlated. Until more profits start getting booked, it’s still an experiment! BTW, Atomics won’t work on Fuzzy Bears due to the put skew, you can’t get enough selling put spreads to even come close to covering the cost of the protective calls.
Sue
p.s. My 45 SPY contracts have about $18,000 total risk, for virtual control of $1,215,000 of SPY shares. The beauty of fuzzies! I probably won’t post a lot unless some of these start coming off, or need some kind of management.
UPS, XBI
#Fuzzy – BTC UPS Feb23’18 110 calls for 0.05, sold for 0.43. STO UPS Mar02’18 109 calls for 0.43.
STO XBI Mar02’18 95 calls for 0.48
SLB
#Fuzzy – BTC SLB Feb23’18 68.5 calls for 0.04, sold on Friday for 0.21. Gonna wait and see how the market reacts to the Fed minutes before selling calls for next week.
XBI
#Fuzzy – I’ve got a LOT going on this week so didn’t even get to watch any of the action today, but I did BTC XBI Feb23’18 95 calls for 0.05, sold for 0.40. Waiting to sell calls for next week…
WMT
#pietrades and skew I have…
#pietrades and skew
I have noticed over the last few weeks that a lot of tickers have one sided skew. Just something else for us to take advantage of and increase returns.
For instance, SPY and all the other indexes seem to have put skew meaning the puts are worth more than the calls. Makes sense, a lot of people are hedging and buying protection. So makes more sense to sell puts on these.
However, a lot of individual names skew to the call side. Even AAPL which drags the rest of the market has a little call skew even in the weeklies. Makes more sense to sell CC or set up #fuzzies on these. Most of the leveraged ETFs skew to the upside/call side.
So going forward the #pietrades will be set up taking advantage of this skew. In a limited back test it looks like it could result in an additional 15-25% returns annualized. Not chump change!
So in the future #pietrades will either be CC, naked puts, or covered straddles depending on direction but also where I see an edge in the put/call skew. However, where I may normally sell a put, I may do an ITM CC if it looks like the skew will give an advantage. Also if I have a strong upside directional bias may set the initial trade up as an ATM covered straddle.
If anyone else finds additional ways to suck more premium out of the market on a weekly basis please post.
Taking advantage of this with synthetics aka #fuzzy may work as well.
XOM
BTO Mar 29 76/76/74 Long #Fuzzy 1.89
Un-Hedged at this time
XLV
BTO Mar 16 86/85/83 The Call a bit more ITM 3.25 P/P/C #Fuzzy Un Hedged at this time
MU
Feb 15 #Fuzzy Land Whew!…
Feb 15 #Fuzzy Land
Whew! Sea sick anyone?
1. Closed yesterday’s SPY #AtomicFuzzy for 41% profit on the core trade, total of $580. During the brief market swoon today I thought I’d take the profit. I didn’t anticipate the huge up move that followed.
My future Atomics will be set with April expiration unless I specifically want a quick flip.
2. Opened a new AAPL Atomic Fuzzy: Apr 170/170/165 @ 6.39 x 2, 180/185 Call Credit Spread @ 1.35 x 4. AAPL had a nice MACD cross today on the daily.
3. Closed the 15 DIA Fuzzies that I opened yesterday for a $1700 profit.
4. Rolled hedges on the AAPL and FB fuzzy bears that are taking heat.
My CLOSED fuzzy total for the quarter now is $26,454. I sure would like to reclaim that 50-handle…but I’m still being cautious. This string of powerful up moves….not a single one of them is a 1-standard deviation move. How can that be, you ask? The down move on Feb 5 was 5.4 standard deviations….as long as that bar stays in the SD average for compilations, it will affect all other bars printing. So, even though I’m looking for 3 1-SD up bars to confirm the rally, I have to keep in mind that the bars are being tamped down by that massive Feb 5 bar. Any indicators that you use that are tied to standard deviations will be seeing the same skew.
AAPL
TSEM
Closed #Fuzzy, poor choice, too short of trade. -205.00
UPS
#Fuzzy . Has anyone looked…
#Fuzzy . Has anyone looked at Ford for a fuzzy?
F Jan 2020
STO 9.87 PUT
BTO 4.87 PUT
BTO 9.87 CALL
Or if you BTO 11.87 CALL you can do the trade or a credit.
Is there a trade here, or am I too optimistic?
MU, XBI
#Fuzzy – STO MU Feb23’18 45 calls for 0.32.
Also STO XBI Feb23’18 95 calls for 0.40.
Feb 14 #Fuzzy Land Hi…
Feb 14 #Fuzzy Land
Hi Everyone! I’m starting to take some new Fuzzy nibbles. I’m still not seeing the indicator that I want for a full blown rally, so I’m being very cautious with size. I’m still making the bulk of my daily money with NQ scalping right now.
Open positions:
AAPL Fuzzy bear (apr 165/165/170) only a teensy 2-lot. Closed hedge today
DIA regular fuzzy: Mar 274/274/245 @ 3.87 w/ 251 hedge, 15 contracts in 2 accounts
FB Fuzzy bear (apr 175/175/180 @ 6.16, removed hedge today, 5 contracts
IWM Regular Fuzzy (Mar 151/151/149) hedged w/ 151 (ITM)
MU Regular Fuzzy (Apr 42/42/40) w/ 43.5 hedge (close to ITM)
SPY #AtomicFuzzy (Mar 269/269/267 x10, 271/275 x20) did you catch this?
TBT Regular Fuzzy (Apr 39/39/37) unhedged
Who caught the Atomic Fuzzy? Don Kaufman at Theo Trade has an “Atomic Hedge” trade, where OTM puts are bought at a certain expiration, and using the same expiration a 2x OTM call spread is sold to cover the cost of the puts, all against a long underlying position. The trade hedges pretty well, while still offering long delta for continued move up. Of course after reading about it, my first thought was “Fuzzify it!” So by doing the same thing with a Fuzzy, the max loss is cut in half or more. I put my first one on today and I liked the movement it saw in the rally. What it does is build in the hedge up front, so you can set it and forget managing hedges.
Here’s my specfic trade on SPY:
1. Synthetic: Mar 269/269 for .51 cr x 10
2. Protective puts: Mar 267 for 4.33 x10
3. Atomic element: Mar 271/275 call credit spread 1.63 cr x 20
Regular Fuzzy max loss: $5451
Atomic Fuzzy max loss: $2560
It does suck away about 100 delta so it moves more slowly than a regular unhedged fuzzy. Also it needs to be managed early to avoid the upside “sea of death”. But it moved well in today’s rally and is designed for holding just a week or two with this DTE, or can be designed with a much longer DTE.
I’m a tester/tweaker on everything, this is the first test….so I’m happy to keep reporting on these as a few more test cases are created. Hey…it sure is nice to see the cost of fuzzies coming DOWN!! 🙂
Sue
SVXY additional thoughts
So without being back in contango SVXY is now up 1.2% on the day. I have been looking at percentages and found some info that the reason it dropped so hard was because of the difference in the short vs. long term VIX nunbers. Had long term vol. been higher, the drop would not have been as severe. It appears that you have to watch the potential spread and the wider it gets, the more damage a volatility spike will cause.
Since vol had been so low, the difference caused by the spike was more severe.
Anyway, I certainly won’t trade it unhedged again but I think it is a useful tool for income and trading.
Also, at these suppressed levels the option premium is not there to justify selling cc yet, at least for me. We start getting some decent premiums I will start selling weeklies against it but need at least 0.40 a few strikes OTM before I would call that decent. Had you sold the ATM you would already be rolling.
Once back in contango (vix below 17 should trigger), the drag from rolling the options should start to have a good benefit. Historically about 1-2% every 2 weeks in looking at the contango history.
Do we zoom back to 140, probably not. But if we can stay in contango for a while, we could be sitting at the 30-40 level again in 6 months. That would be enough of a recovery for me to close everything out and move the earned back cash to other vehicles.
I think the best way to trade this would be #fuzzies after a vol spike. Controlled risk, no cap on upside if you do not sell calls against it.
I know a lot of us were burned on this and I can feel your pain, 2 IRA accounts almost completely wiped out, but I think if we are patient, hedge gradually on the way up (buy puts in case it goes to zero), we can get back most of what we lost in about 6-12 months. Of course any additional vol. spikes will slow that down. Be patient but hedge.
Just thinking out lot. Anyone else have anything to add please comment……….
BMY STC #Fuzzy 60/60/58 Mar…
AAPL
BMY
#Fuzzy – BTC BMY Feb16’18 63 calls for 1.66 sold for 0.53, STC BMY Mar23’18 60/60/58 Fuzzy for 5.09, bought for 2.09. Hope this one pulls back some and I will do it again maybe. After all is said and done made 1.96 on 10 contracts.
MU
#Fuzzy – BTO MU Mar16’18 44/44/42 Fuzzy for 0.75. Leaving unhedged for now. MU reports earnings on 03/22/18.
XBI
#Fuzzy – BTC XBI Feb16’18 93 calls for 0.38, sold for 0.42. Leaving my core XBI Jun’18 91/91/88 Fuzzy unhedged for now. Trying to get out of the way of the stock moving up. Coulda closed for about 0.08 earlier today. Poof there went the Valentines dinner and spa treatment, got reduced to a box of chocolates! Hope I didn’t mess up but looking like the market may go up for a bit with decent earnings coming in and the Fed meeting over a month away.
#pietrades Rolled GM 42.5 put…
Rolled GM 42.5 put that expires this week out 2 weeks for 0.43 credit. CB now under 40.
XBI STO 10 DTE 85 put for 0.77. Went through fast at mid point, may be able to get more if you work the order.
SVXY decision. With the futures expiring today, my hope is that as they expire we may see a pop. However I do not expect steady gains until we are no longer backwards which may take a few weeks and probably not until the VIX is under 18. Anyway, I am holding the stock until then. Once we have some gains I will make sure it is hedged in the future, probably by setting up a #fuzzy ratio but do not want to spend extra money on this trade until it recovers even a little.
The VXX trades below look smart. I would do it if had capital left. The hedge fund book I am reading, Mark Sebastain does that every 2 weeks. Buys puts on VXX or a debit spread and rolls it to the next 2 weeks when there is a 50% profit. May be a smarter way to play #vxxgame in the future. Losses are capped but probably steady gains. The flip slide would be selling ATM call credit spreads.
I will NEVER be short VIX, SVXY unhedged in the future, lesson learned the hard way again. I think a hammer the head would have been easier.
Thanks everyone for the help/thoughts on VXX/SVXY over the last few weeks. I think going forward we are all much smarter about how to use these instruments and more importantly how not to use them. But collectively I think we will all make back most of the losses within 1-5 years (that seems like a long time at the moment) but will go by faster than any of us can imagine!
SPX Hedge
#RocketManHedges – Looking at booking these tomorrow and setting up something new on the bounce. With put premium so high now it looks like the best play might be just buying the put(s) out to about May and then selling weekly against them.
An example if we really bounce in the morning could possibly:
Buy May 2018 2650 Put @ 100.00 (or SPY for smaller position)
This would leave 14 weeks to sell against it and only require 7 dollars per week to cover it. Right now one week out puts 100 points out of the money are going for an incredible 15 dollars. 50 points out of the money are 24 dollars. Seems like a pretty good risk/reward to have a decent hedge on out through May…
BMY
#Fuzzy – BTC BMY Feb09’18 63 calls for 0.03, sold for 0.15. STO BMY Feb16’18 63 calls for 0.53. Y’all be careful it’s lookin slippery out there.
AAPL
Feb 8 Howdy!
Hey everyone, just wanted to pop in and let you know I’m trading VERY small. Just 1-2 lots of #Fuzzy . Mostly shorts. Fuzzies are very expensive now. It helps to hedge them since hedges are also expensive (credit). But hedging slows them down considerably in movement. I like to get out with 50-100% gains. Where I’m doing best now is scalping /NQ.
I’ve mentioned my ” #Augen Spike Code” in the past (From Jeff Augen’s book The Volatility Edge in Options Trading). It translates price action into standard deviations. It helped me find a crash indicator different from what everyone else was viewing. But I also found an important bottom indicator is when there are 3-out of-5 daily bars with 1-standard deviation up moves. .99 doesn’t count, must be over 1.0. Going back in time w/ the indicator I found anything less than 3-in-5 led to shallow false or short term rallies. So on rally days I’m watching and counting those bars.
Sue
Here’s the code if you want it: http://tos.mx/FnguWH
XBI
#Fuzzy – BTC XBI Feb9’18 93 calls for 0.04, sold for 0.52. STO XBI Feb16’18 93 calls for 0.42.
BMY Rolled Feb 9 63…
SPY
XBI
#Fuzzy – STO XBI Feb9’18 93 calls for 0.52
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!
BMY
#Fuzzy – BTO BMY Mar23’18 60/60/58 Fuzzy for 2.08. Leaving unhedged for now.
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
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?
#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
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.
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!
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…
SPY
AAPL
BTO Mar 23 162.50/162.5/160 4.50 #fuzzy
Just a quick note, I…
Just a quick note, I had some expirations but managed to roll all of them for more cash so they are all next week now. The last move like this in Aug. 2015 crushed (and I mean wiped out) a major trading account. Today my main trading account only down about $500, the hedges worked well.
See you can teach old dogs new tricks and thanks to everyone here for showing me some additional tactics that help on days like today.
Everyone have a good weekend, looking forward to Sunday night opening. Either way have some trades lined up and kept some cash on the side lines so I can take advantage of the blood in the street 🙂
Technically what only a 2-3% drop? Technically 2.31% on SPX/ES.
Cue the chicken, I am glad I closed the /ES strangle this morning. Not ITM but the margin would have used up my cash cushion for next week.
#Fuzzy #fallingknife After closing my…
#Fuzzy #fallingknife
After closing my SPY Fuzzy Bears I dipped my toe into the #FallingKnife trades on long SPY Fuzzies, 3-lots in 3 accounts, 277(c)/277(-p)/275(+p) @ 4.53 (double the price they were a couple days ago!) hedged with 281’s around .60.
Get your computer in front of the TV Sunday for futures open.
Whiskey time.
Sue
Dancing with ( #Fuzzy )…
Dancing with ( #Fuzzy ) Bears
Hello everyone! Not gonna lie, my net long deltas are feeling pain today, but I have so much silver lining here! Fuzzy bears are dancing and singing, holding hands with hedges and protective puts. None of you guys (men) could get away with saying a sentence like that 🙂
1. Gorillas are getting stopped out, gone are: BAH, TSEM, IDTI
2. Lots of hedges are rolled. The best way to balance long fuzzies is to rework the hedges and bring in fresh short delta. Rolled SPY, MSFT, CMCSA, IWM, KR, CAT, MU, collecting about $2800.00 on the covers.
3. Added a new Fuzzy bear on QQQ Mar 167/167/19 @ 2.73 hedged w/ 164 @.65
Revised Short Fuzzy Profit (on CLOSED Fuzz’s) after taking some losses today: $47,997
Net hedge collection on open positions: $25,180
LMT #fuzzy My LMT fuzzies…
LMT #fuzzy
My LMT fuzzies got blasted today due to hedge annihilation. Closed 20 contracts for a mere $700 profit, lots of the previously-reported hedge profit got taken out today. Will reset.
New fuzzy: MSFT Apr 95/95/92 for 2.73, Hedged w/ feb 9 99 for .25. I made $3460 on MSFT naked puts this morning. MSFT is my “animal spirit.” My dog is nicknamed Satya Nadella, so she gets a special treat every quarter when MSFT reports.
Sue
PYPL
#Earnings repair trade with #SyntheticStock – Well…the put sales were looking ok until the Ebay announcement came out so we’re now in repair mode with this one. I really thought the stock would be down even further so not bad so far.
The put sales brought in 600 and the cost to close was 2330 for net loss of 1730. I’ve set up a synthetic with 10 contracts so I’ll add 1.73 to my total cost of the position.
Sold PYPL JAN 18 2019 80.0 Puts @ 9.47
Bought PYPL JAN 18 2019 80.0 Calls @ 10.28
Bought PYPL JAN 18 2019 77.5 Puts @ 8.64
This gives a net debit of 9.45 for the Jan 2019 position. Add the 2.5 point max downside and the 1.73 put sale loss and get a max loss possibility of 13.68. Based on that, and the 50 weeks remaining in the trade I only need to average about 27 cents per week in sales to cover the absolute worst case scenario.
So:
Sold PYPL FEB 9 2018 81.5 Calls @ .77
Jan 31 #Fuzzy Land Hello…
Jan 31 #Fuzzy Land
Hello Everyone! Goodbye January, you were incredible! Good day here, the mix of long and short Fuzzies netted out for green today, hedges worked great, F-bears worked great.
1. ANSS took Fuzzy profit just shy of my target on a price spike, will look to get back in
2. Closed a tiny DIA long fuzzy on the highs today
3. Added 25 SPY Fuzzy Bear contracts across several accounts. Mar283/283/285 @ 2.58 with a 278 hedge @.84
4. Rolled DIS hedge collecting $550 profit
5. Rolled CAT hedge collecting $1270 profit
6. Opened new EA fuzzy on UOA, Mar 130/130/125 for 1.21, no hedge yet (the UOA was a buy of Mar 135 calls, + June 135 and 140 large call buys)
7. Rolled JNJ hedge collecting $400 profit.
8. Yesterday I cut the KBH fuzzy for $2400 loss, saved a little by selling one round of calls on it, sold Feb 30-strike puts to recoup a little (or not).
9. Rolled IWM hedge collecting $330.
Fuzzies that need management this week: CELG, 1-MU, 1-QQQ, 1-SPY,
Total Closed Fuzzy Profit: $49,383; Hedge collection on open positions: $24,260
Oh, one thing I forgot to add: Trader’s Almanac has been pretty good so far this year. It shows tomorrow (Thur) is the biggest day for bulls for the whole month of February. 🙂
WYNN
#Fuzzy – STO WYNN Feb02’18 175 calls @ 0.90. This ticker might give me whiplash.
Options Bistro 