• Ocean Man
    Sold another 1/4 of my Jan 25th $147 $SPY puts for a gain of 18% in 2 trading days. $2.09 ---> $2.48. http://seekingalpha.com/s/aj37r
    1/8/13
    Reply (10)
    • Ocean Man: Those puts were bought with SPY at 145.90 and 146.18, avg 146.04. SPY dropped 92 cents to 145.12, yet the puts only gained 39 cents.
      1/8/13
    • Ocean Man: These puts were bought in the money (147) and 3 expiration Fridays out to avoid time decay, but still got eaten up in just 2 trading days.
      1/8/13
    • Will Erlandson: Volatility contraction, perhaps?
      1/8/13
    • Ocean Man: That's not helping either, good point Will.
      1/8/13
    • Rubenov: This is why I sell options :)
      1/8/13
    • Bret Kenwell: SPY has gotta fill that gap too! VIX below 14. Still some catalyst but certainly dragging its feet in a frustrating manner.
      1/8/13
    • Will Erlandson: I usually do a little of both through spreads/diagonals. It's been harder the last couple weeks to find selling opportunities with low IV.
      1/8/13
    • Bret Kenwell: Yes. Has left traders at an interesting crossroads. Could always buy longer-dated puts
      1/8/13
    • Will Erlandson: One can always play by buying $VIX. Other chances in larger stocks. Calendars too - chances to play the differential from front/back month.
      1/8/13
    • Will Erlandson: Or pairs trades. IE $SPY puts and $TBT calls.
      1/8/13