WYNN

#ReverseRolling – I’ve been in this thing for a year just selling and rolling. It’s been a sweet ticker with great premium but really running now. Closing the last of my short puts and reverse rolling the DITM short calls to very bullish bull put spreads.

Bought to Close 3 WYNN JAN 19 2018 170.0 Puts @ .25 (sold for 9.00 accumulated after a couple rolls)

Reverse Rolled the calls for $270 total credit (.54 per new spread avg) but had to increase size from 3 closed to 5 open to get the credit.

Bought to Close 3 WYNN JAN 19 2018 140.0 Calls
Sold 5 WYNN FEB 16 2018 200.0/170.0 Bull Put Spreads

Now the big picture:

Aggressive put selling for last few months has now brought in $8343 in premium. That was for 3 contracts but now has to be spread over 5 contracts giving me a basis in the new position of:

200/170 BuPS @ 16.68

If WYNN rallies then it’s all good. If WYNN tanks I’ll roll all of this into #Fuzzy positions wherever the stock finally ends up. Breakeven on the spread of 183.32. Anything around that and I’ll have to decide whether to roll or go #Fuzzy

Whew!

SVXY

#ShortCalls #ReverseRolling – This is the last of the short calls. Only naked calls now are next Jan at 235 and 260.

Rolled SVXY JUN 15 2018 165.0 Calls to SVXY JAN 18 2019 45.0/260.0 Strangles @ .70 credit

SVXY

#ShortCalls #ReverseRolling – Rolling from short calls to aggressive put spreads…

Rolled SVXY JUN 15 2018 155.0 Calls to JAN 18 2019 160.0/135.0 Bull Put Spreads @ .40 credit

STMP

#Earnings #ReverseRolling – Glad to be out of this at even. Originally was an earnings strangle that took some heat. Rolled the threatened side out to a strangle a few weeks ago. Needed to get out at .30 or less for breakeven.

Bought to Close STMP DEC 29 2017 160.0/195.0 Strangle @ .20

SVXY

#VXXGame #ShortCalls #ReverseRolling – Various adjustments in SVXY today. Mainly getting the short calls to slightly safer areas…

Reverse Rolled SVXY MAR 16 2018 135.0 Call to SVXY JAN 18 2019 25.0/235.0 Strangle @ .20 credit

Rolled SVXY MAR 16 2018 140.0 Call to JUN 15 2018 165.0 Call @ .13 credit
Rolled SVXY MAR 16 2018 145.0 Call to JUN 15 2018 170.0 Call @ .70 credit

New all-time high in SPX

We’re off and running… Upside Warning going into effect at the close, provided VIX closes below 9.85

#reverserolling

SVXY

#ShortCalls #Rolling #ReverseRolling – This thing is relentless. I’m rolling some Jan short calls early. A combination of reversing into bull put spreads and rolling up and out. This gives March and June 120/105 bull put spreads with short calls above them. Is that a #CoveredBullPutSpread ?? 🙂 🙂

These add to some previous rolls to similar positions…

Rolled SVXY JAN 19 2018 122.5 Call to JUN 15 2018 165.0 Call @ .40 credit
Rolled SVXY JAN 19 2018 122.5 Call to JUN 15 2018 120.0/105.0 Bull Put Spread @ .50 credit

Rolled SVXY JAN 19 2018 125.0 Call to MAR 16 2018 140.0 Call @ 1.19 credit
Rolled SVXY JAN 19 2018 125.0 Call to MAR 16 2018 145.0 Call @ .29 debit

WDC

#ShortStrangles #ReverseRolling – Screwed the pooch on my roll to inverted by being impatient so reverse rolling calls into low risk put spreads for a credit. Going directional since it’s one I wouldn’t mind trading around for awhile. Went inverted on the original strangle WAY too early.

Rolled WDC DEC 29 2017 79.5 Calls to JAN 19 2018 85.0/80.0 Bull Put Spreads @ .43 credit.

This is another one of those where it doesn’t really matter to me how low it goes. With 3.80 of accumulated premium on the 5 wide spread the worse case scenario is owning the stock at a basis only 1.20 above where it happens to be at expiration…(as long as I book the long put gains late on expiration day and let the shorts get exercised)

Still holding short 82.5 puts from original strangle….

STMP

#CoveredCalls – Was still holding stock from an old earnings trade and had it covered with ITM calls for max downside protection. Chart looks like crap so I’m #ReverseRolling covered stock into a strangle. I don’t want to possibly get stuck with another falling stock and selling calls forever. Goal was to get out even once the earnings trade busted.

So:

Sold to Close covered stock @ 167.15 (that was a loss of 3.90)

To make up the loss and get back to a slight profit including commissions:

Sold STMP DEC 29 2017 160.0/195.0 Strangle @ 4.30

SVXY “Triple R” Repair Roll Reversal

Via special request, I’m delving into the nuts and bolts of the reverse roll repair strategy. It seems to work for any ticker but I tend to use it more often with SVXY with it’s unrelenting climb. I originally got this idea from some stuff Jeff was doing and also seeing Suz over at OMM use it as a low risk directional play on a stock.

Here we go….

My original trade was:

Sold 1 SVXY JAN 19 2018 120.0 Call @ 3.20

From the second I clicked the mouse button SVXY has pretty much gone straight up. This position is still out of the money but starting to take some heat. When the option gets near doubling the amount of premium I received I start looking at repair or adjust scenarios. Originally sold for 3.20 and currently going for 6.00 so getting close. So, what can I do? Well…lots of things:

1. Sit on my hands and hope
1a. Sit on my hands longer and hope for a black swan to fly by
2. Close for a small loss
3. Roll out and up (I like this choice too)
4. Reverse roll into 1 or more naked puts (I personally don’t add any contracts since I’m a big believer in position size control)
5. Reverse roll into a put spread (IMHO this is the safest)

**** on a side note, small position size it what allows me to make these adjustments. I’d rather have 50 single lots spread around among 50 tickers vs a single 50 lot on one ticker ****

For this example, I’m going to use choice number 5 on the list. You have to play with the numbers and decide what works best for you. I tend to look out about 3 or 4 months and try to sell something that’s around at the money. In this case, March 120/105 BuPS works but you could go more aggressive with the 130/115 for more credit. I’ll use the 120/105 in this example…

Buy to close Jan 120 call @ 6.00
Sell to open Mar 120/105 BuPS @ 6.70

Since the original call sale brought in 3.20 I’ll add that to the .70 credit for the roll for a new total premium of 3.90.

Ok…now what? How does this eventually play out on down the road? Glad you asked! Here’s some scenarios:

1. SVXY continues it’s relentless climb and our reversal goes on to be a glorious 3.90 winner.

Or: (worse case scenario which I ALWAYS look at)

2. We wake up the morning of March expiration and we’re standing in the middle of massive carnage with SVXY trading at 20 bucks. What do we do?

The spread is sitting at max loss of 11.10 (15 wide minus 3.90 received). Late in the day I’m going to sell to close the long 105 put at whatever it’s worth. I will let the short 120 put get exercised. When the dust settles my basis in the stock I received should be in the ballpark of 31 dollars. That is the current stock price plus the loss on the spread. No matter how low SVXY goes we should get the stock at a basis no worse than about 11 dollars above where it happens to be trading thanks to the spread (and if it goes to zero we’ve minimized the damage). We can then begin selling covered calls from a small hole instead of a deep crater.

Let’s say we would have chosen option 4 above in our repair choices. We could have bought the 120 call back at 6.00 and sold a March 85 put for 6.50. Net credit of 3.70 now on the 85 put. (3.20 original call sale plus .50 credit roll). Then we wake up in March with SVXY at 20 and we own stock at a basis of 81.30…ouch. A much much deeper hole to begin recovery than the 31 basis of the spread strategy.

Hopefully this fully explains my thinking on these. Any comments, critiques, or suggestions…feel free. I’m pretty thick skinned…LOL

Happy Turkey Day everyone!

#ReverseRolling

NVDA adjustment

#ShortStrangles #ReverseRolling – Current position was 170/150 inverted @ 25.24

Bought to Close NVDA JUN 16 2017 150.0 Calls @ 15.00
Sold NVDA JUL 21 2017 180.0/150.0 Bull Put Spreads @ 15.16

That keeps the new position in expirations prior to earnings. If we don’t get an earnings run I should be able to make a nice roll into the high IV of earnings. You know IV will be through the roof this time!

Not getting greedy so don’t want a double size bullish position so:

Bought to Close NVDA JUN 16 2017 170.0 Puts @ 7.70

That’s considerably less than I received for multiple roll ups this week…still preserving 17.70 premium and now completely out of the PITA call side and reducing margin required by about two thirds. Downside is I’m highly directional now…gulp!

Downside Warning has fired

Downward we go

#reverserolling, #spxcampaign

$NUGT

I don’t know how anyone makes money with this. I got creamed with a strangle 10 wide (expiring today) Wed when it was selling for 87. My 98 call is deeply underwater, and I expect rolling it out to March 20 will only compound the loss. I normally cover a short calls for small gain but thought I had enough buffer. What do the experienced $NUGT traders think is a smart strategy?

#reverseroll

#reverserolling

$UVXY I’m short the weekly…

$UVXY I’m short the weekly 26.0 Put. I’ve rolled it out twice already. Does there come a point when you have to take the loss, or do you just keep rolling it out. I’ve never experienced this before, where the stock just keeps losing ground.
Anybody?

#contangoetfs, #reverseroll, #reverserolling