Followed Fauzia at TT, sold a jade lizard with a margin reducing put. Feb. 2, 150/167.50/185/187.50 for 2.85
@vxxkelly did a recent trade on this and it reminded me it’s been on my watch list. There’s a lot of block trades on it today, and some calls being bought. So I did an unprotected #Fuzzy . I did a Mar 70/70 synthetic and sold Dec 22 71.5. I will add protection after an up move, for a better price. In a squeeze right now.
Didn’t capture my trades from yesterday, but a couple highlights:
1. Rolled the JPM Fuzzy hedge into strength to collect more on the next week
2. MAR #JadeLizard closed for 50% target
3. My SPX #FuzzyBear is troublesome. I didn’t set it with correct timing, so now I’m doing battle. I took off one short call on the synthetic turning it into a back ratio like @hcgdavis mentioned yesterday. I’m also using the AS-BB indicator for legging in and out of the hedge puts to get a few extra $$ on it.
#Fuzzies need rolls as Friday approaches: LMT, CELG, NUE. I’ve got substantial net profit on LMT so may close it all rather than roll.
Looks like it was a quiet day for a lot of people here.
1. May I please call these “Fuzzy” trades? I love them and I’m doing a lot of them (#SyntheticStock Diagonals w/ protection and hedge income—From now on known as #Fuzzies. To me, the Fuzzies have two stages, stage one is recovering the net debit of the trade; Stage 2 is recovery of the spread risk. I spent time this weekend looking at and scoring candidates. The “score” is basically the number of weeks of hedge income that it takes to accomplish Stage 1. The fewer the number of weeks, the lower the score. I’m looking for Fuzzies with a score of less than 5, less than 4 even better. I have a picture in my head of having a portfolio of 10 Fuzzies, each with $10 spread risk, bringing in 10-15K a week in income. So I’m testing these aggressively.
I have a TOS scan for finding high-return covered calls and puts, and it turns out it’s a good scan for finding Fuzzy candidates with low scores. Here’s the scan http://tos.mx/vKzR27
So back to Trade #1: CELG. I happened to catch a big bullish fund order for a Jan risk reversal, so a CELG #Fuzzy was my first trade of the day: Mar 110c/-110p/+100p, Dec 15 110 c. Net debit: 1.38 with a “Score” of approx 2.38 (2.38 weeks to cover the core debit)
2. Oh…here’s a nod to @hcgdavis for the Alpha Shark indicator. Got it. Love it. So scalped a bunch of /NQ today while taking it for a test run. Ended up +$305 on small-lot scalps. Enough to pay for the indicator 🙂
3. NTES. Now this was a franken-trade. It started as one 10-lot #butterfly. As it dropped added another 10-lot butterfly. Last week added a 3rd 10-lot butterfly. Was finally able to close it all out today for a $157 loss. Believe me, I’m happy with that!
4. #Bitties Closed! SPX x 20 lot, NDX x 10 lot. Got 50% target on all of them. The SPX bitties were 7DTE, so was happy to close them asap given the gamma risk. Net profit $1150.
5. Reset 17DTE SPX #Bitties. The Dec 27 2630/2625 for .85 cr x 20
6. NTNX I’ve been holding 703 shares, took 603 off for about $950 profit. Some day they’ll be acquired so I’ll always keep a hundred on. Great stock for swing trading, so will load back up on any dip. My max size position is 3000 shares, but I never seem to get the opp to add that many on.
7. QQQ #JadeLizard closed for 50% profit, this week’s expiration
8. SPY 266/267 #BuCS closed for 90% profit. This was bought based on #UOA (unusual option activity). SPY trades massive volume in fund flow, obviously—but it’s almost all put hedges. Every once in awhile a big bullish trade hits the tape, and those are ones for my attention.
9. NUE Closed a BuCS for 50% profit, this is another one that was bought on #UOA
10. NUE Opened a #Fuzzy Apr 60/60/50 for 1.87 core debit, Dec 15 62 call short for .56, Score is 3.3. There was a lot of bullish option flow on this today….all the way up to the 70 call line.
11 NUE spec trade based on #UOA bought 100 Jan 70 calls for .16, just looking for .21 as my target
12 MU #EarningsRunUp added two more calls to the trade from last week. Looking for 30% profit on these and must close before earnings announcement.
13 AMC #UOA There was unusual activity on AMC right before the other cinema merger happened last week. Turns out AMC confirms they’ve been approached too, regarding investment options. I’m glad I sold a few puts when I saw the fund flow. Netted 50%, $370.00 on a 10-lot
14. MSFT I like to layer on a lot of different MSFT trades. I love what they’re doing with Azure. However I saw a lot of January put buying today on MSFT, so I cut a trade short (#BuCS) for 28% profit vs. the 50% I was looking for. I still have on a MSFT #Butterfly that I’m watching closely. 80/85/90 for Feb.
15. ALGN This is the last of my trades from the tech crash. I defended it resulting in half what the max loss would have been. All closed now for $1150 loss. Classic case of thinking it would come back. Could have been handled better, but could have been handled much worse. I wouldn’t mind resetting with a #bitty or #PutRatioSpread the problem is that it’s just really thin. The Market Makers are not the worst I’ve dealt with (ISRG, KORS, ULTA are worse) but it’s still a struggle.
16. TWTR Opened a #Fuzzy in a 401K. I again saw some large bullish fund flow on TWTR and it had a good score. Mar 22/22/18 core for .78, sold Dec 22.5 call for .46, score is roughly 2. Not sure how this one will work out, but I’m still developing the perfect candidate profile for the Fuzzies.
@fuzzballl I hope you are ok being the namesake on these trades. It’s cute!
1. NVDA: Fully closed the #JadeLizard sold for 3.62, partial cover at 1.62 yesterday, rest covered today at 1.35
2. BA: Closed the contrarian BePS, closed for .66 shy of full loss. Prob of touch is still high enough I should have held, but it’s just continuing to be a train.
3. LRCX: Closed the #PutRatioSpread for over 50% gain, 1.45, $1555.00. Recovery mission on big loss last week.
4. MSFT: #Bitty closed for 50%, this was Jan 80/75 BuPS for .82 cr, covered .41
5. SPX : I’m kind of thinking we see a strong market into next week’s expiration, so rolled the short puts on the #RocketManHedge from 2605 to 2625. Realized $2820 in the roll.
6. SPY: Opened #SpikedLizard for January. Part 1: 264/265/267 for 3.74 cr Part 2 (spike) 260/253 ratio put spread for .05. No upside risk, downside BE is 253 due to the spike. Need SPY price above $260 for meaningful profit. 50% target. I’d like to ladder these every 2 weeks.
7. SPX: Opened 7DTE #Bitty I said I didn’t want to do 7DTE Bitties any more, but betting we see an upside into next week’s expiration. Of course I could be all wrong. Got more credit than usual on these. Dec 15 2630/2625 BuPS for average price of .875 credit, 50% target
8. TXN: Opened BuPS for January 97.5/95 for .72, 50% target
9. TJX: Continued defense. Sold Dec 15 calls to adjust deltas
10. MU: Opened #EarningsRunUp trade based on historical backtesting. Partial position. Dec 22 47.5 call for 1.04.
11. PIR: Closed #EarningsRunUp trade for 28% profit, bought at .35, sold at .45
12. ABBV: Opened #BuPS for January 92.5/90 for .56, target 50%
13. FLIR: Opened #SyntheticCoveredCall for January 47 puts for 1.40, very high historical win rate on short puts for this company
14. BBY: Closed the contrarian BePS for loss, salvaging .60 from max loss
15. AAPL: I already have a BuPS on for next week, used this little upswing today to sell calls converting it to an #IronButterfly.
SPX: #rocketmanhedge thank you @fuzzballl Feb +2635 put, -2635c, +2640c for 40.15 net, -Dec 2605p for $5.40, Basis = 34.62.
COT: Last month there was a day with 4 large block trades totaling over 4 million in shares. It sparked a lot of call activity. I’ve been waiting for closer to 13f releases for Dec to see if call activity picks up again, it sure did today, so I have a little spec play on for COT for next week. 17.5 calls for .34
MAR: #JadeLizard for next week Dec -126p/-130c/+132 c for 1.21 net cr, 50% target
TJX: Added #BECS to #BUPS to convert to iron fly for defense
BA #Bitty Closed at 50% target, sold at .50, bought at .25
TTWO #BUCS Bought 2.65 sold 3.10 net .45/contract
FB #shortputs covered for 50% Sold at 1.10, covered at .55
NVDA #JadeLizard from last week is beginning to cover for 50% Sold 185/205/207.5 for 3.62, cover order is partially filled at 1.62
Here’s trades not already mentioned today:
CVX: Closed #JadeLizard for $230 profit before it “slid down the slope” on the right-side P/L graph
QQQ: Opened #SharkfinHedge (as coined by Bruce Marshall) before market direction became solidified today. Dec 8 153/148/146 put fly for .53 (called sharkfin because of the P/L picture). Wanted just a bit of tech protection in case sell off continued.
NDX: Managed BeCS hedge, took 1/2 off, rolled other half to new strikes.
RH: Opened long calls (Dec 8 106) for earnings run up trade, will be closed day before earnings, high historical win rate
BA: Bitty hit profit target for $276, rolled to new expiration (Dec 15 270/267 for .50)
SPX: Rolled BeCS to new strikes for extra range
IWM: Closed JadeLizard early for $25.00 scratch (it was kind of a hedgie jade lizard, no longer needed)
NTNX: Added last tranche of short puts before earnings, trade is up very nicely after hours
PLAY: Closed long calls on Earnings run up trade for $165 (40%) profit, trade based on historical win rate.
Net Liq repair project still underway, but nice progress today