Wait To Deploy Credit Spreads & Complete Iron Condors, Let This Rally Run
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Seeking Alpha Analyst Since 2009
My name is Trevor Vernon and I created BookingAlpha in response to the events precipitated from the financial collapse of 2007-2008. After years of generating additional wealth for already wealthy individuals through my hedge fund and various other holding companies and financial activities, I had a wake up call. Witnessing family, friends, and complete strangers being adversely affected ,and many totally devastated, by the ripple effects of the collapse affected me in a way I didn't know that it could. The greed, complacency, and morally corrupt financial system that it is Wall Street cause this devastation to occur. What's worse was I realized I was a part of this. I toiled sucessfully for years to perpetuate an industry of thieves, liars and cheats; and it was all coming home to roost. I was mortified and ashamed to be associated with such a farce.
I founded BookingAlpha to provide never available before access for REGULAR investors to the world of Hedge Fund investing and its out-sized returns. The strategies I and other hedge fund managers use to generate consistent returns for wealthy clients are very much an art and science reserved for the Fat-Cat Boys Club of Wall Street. Buy and hold is dead for stocks proving long term investing is a joke, and mutual funds are probably the greatest wealth generating industry for everyone EXCEPT the actual investors in the financial universe.
The market has found its mojo recently but it is too early to initiate call credit spreads. Our put spreads placed over the last few weeks are positioned perfectly but it is too early to sell credit spreads to create Iron Condors with the existing put spreads.
Earnings this week from tech giants like Intel, VMWare, Yahoo and Apple have provided the catalyst to propel the market back up to resistance. This is a pretty common occurrence, rallying the first couple weeks of earnings, and even more common for the Q2 earnings cycle.
A 14-15 handle VIX is extremely low and the resulting low options premiums make it not worth issuing low probability credit spreads until the market gets extended. Just like we wrote put spreads during the pullback to SPY 130’s, we will wait until we see SPY 135 -137 before we deploy call spreads to complete Iron Condors.
Earnings this week from tech giants like Intel, VMWare, Yahoo and Apple have provided the catalyst to propel the market back up to resistance. This is a pretty common occurrence, rallying the first couple weeks of earnings, and even more common for the Q2 earnings cycle.
A 14-15 handle VIX is extremely low and the resulting low options premiums make it not worth issuing low probability credit spreads until the market gets extended. Just like we wrote put spreads during the pullback to SPY 130’s, we will wait until we see SPY 135 -137 before we deploy call spreads to complete Iron Condors.
One exception is the Q's. The Q's have been ripping this week and are approaching recent highs that will act as resistance. Today the Q's popped outside their upper Bollinger Band and the RSI is getting near overbought levels as well. There may be a call credit spread trade brewing............
Be patient and keep your powder dry.
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