Weekly Options Take Charge

The volume of CBOE’s Weeklyssm options has grown rapidly since they expanded their listings into equities and Exchange Traded Products in June 2010.  Now weekly options comprise almost 30% of the CBOE’s average daily option volume.  The list of available weekly options is available on the CBOE website. Among other things, option traders take advantage of the Weeklys to position themselves for earnings releases,  harvest rapid …

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XIV termination

UPDATE Credit Suisse terminated XIV due to a greater than 80% drop in its indicative value on 5-Feb-2018.  The final payout was $5.99 per share.  The last day of trading was the 15th of February 2018. In the prospectuses for  XIV, there are some disconcerting discussions about termination events. For XIV the termination event is triggered if the daily percentage drop exceeds 80%. I did …

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April Condor

Put a condor in place on S&P 500 April futures.   The call spread was at S1350 (sell-to-0pen) and S1370 (buy), while the put spread was at S1140 (sell-to-open) and S1100(buy).  The net credit on each set of four options before commissions was 6.15 points.   With S&P 500 futures each point is worth $250, on the futures as well as the options on the futures. With …

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Option spreads, early exercise and other wrinkles

A week ago Monday I created an IEF (iShares Lehman 7-10 Yr Treas Bond) bear spread in my Schwab margin account—with the short calls deep in the money at S90.   Several of the calls were assigned that night when IEF went ex-dividend ($0.248/share).  Since I wasn’t long IEF, this assignment resulted in a short position being created in my account.   I was surprised the calls were assigned since …

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