Vance Harwood

Overview of dividend capture strategies

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I have written several posts on dividend capture strategies. My favored, although far from perfect strategy: Dividend capture with covered calls Some approaches I don’t recommend: SPY dividend capture ideas that don’t work Dividend capture—three approaches to skip Additional background and tools, and an example: Dividend capture overview Covered calls–are you ready? Combo orders–maximizing profits on covered calls DIA dividend capture: creating the position DIA …

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How to short VXX—the hard way and the easy way

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Easy way: If you want to short VXX the simplest way is to buy Volatility Share’s SVIX.  This Exchange Traded Funds tracks -1X  the daily percentage moves of VXX so it isn’t a true short, but it has the same goal—going up when VXX goes down.  They carry annual investment fees (SVXY’s is 1.35%), which I doubt is an issue for you if you’re thinking …

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Saving money with combination orders

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If you ever plan to trade more than straight long options you should learn to use combination orders, specifically debit and credit orders. . A combo order allows you to execute multiple trades simultaneously at a single integrated not-to-exceed price.  Some examples: Creating a simple covered call position, buying the underlying equity and selling-to-open calls Creating a call bear option spread, selling the lower strike …

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The “Sell Algorithm”, the Flash Crash, and Limit Orders

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The recent report from the SEC and the Commodity Futures Trading Commission on the Flash Crash fingers an automatic sell program executed by a “Mutual Fund Complex” as the trigger of the crash.  Starting at 2:32 p.m. EDT on the 6th of May this program, referred to as the “Sell Algorithm” automatically sold short 75,000 E-Mini S&P futures contracts (approx 4.1 Billion dollars worth, equivalent …

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Can a Short Squeeze Collapse an ETF?

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Some people have been hyperventilating about the high short interest many ETFs are showing.   XRT for example recently had 95 million shares in short interest with only 17 million shares in shares outstanding.    If you want a detailed response to these fearmongers I found this article to be very helpful. If all of the people that were short XRT decided that they wanted …

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