Are we at the bottom yet?

After several sell-off days with low volume, the buyers seem to be coming back.  I bought SPY at 105.22, sold 27-Aug 106 calls at 0.58. Breakeven is 104.64. Maximum profit is $1.36 per share. Livevol shows the 27-Aug 106 IV’s at 28 and the 18-Sept monthly IV for the 106 calls at 24.  Right now, Livevol’s IV numbers are the only ones I believe for …

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SPY covered call with protective puts

The biggest downside of covered calls is their lack of downside protection on the underlying.   A big, but not unusually big correction can wipe out many months worth of profits.   One strategy for reducing this exposure is to buy puts, but when I have looked into this strategy in the past the puts were either so expensive they ate up all the profits, …

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Two days to go

I’ve been staying out of the market (except for USO), because I think the possibility of a pullback is fairly high.    However, with two days to go on the SPY Weekly 6-August options (which are showing IVs in the 30s)  things started looking attractive.   I created an ITM covered call position, buying SPY at 112.45 and selling 111 strike calls at 1.84.   …

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Recap on SPY weeklies —and some observations

After creating a position with SPY on Wednesday at 111.07  I added to my covered calls on Thursday, buying SPY at 110.12, selling 110 strike calls  at 0.71.   At one point this morning (Friday) , when SPY was off to about 109.5 my 111 strike calls had dropped from Wednesday’s 0.83 to 0.08.   These strong moves are characteristic of options with only a …

Read moreRecap on SPY weeklies —and some observations