Assumes working knowledge of options and a willingness to learn about new things — like volatility
UPDATE CVOL was shutdown by UBS in May of 2016. It never achieved enough assets for it to be a viable competitor CVOL’s stated goal is to “produce returns that are correlated to the CBOE Volatility Index (the “VIX Index”). ” So far no one has figured out a way to offer a direct investment in the VIX Index, so volatility traders must …
This week CBOE expanded their selection of weekly options from 31 to 35. The symbols added this week (expiring November 5th) are: IBM PCLN RIMM SLV. All these except PCLN (Priceline.com Inc.) have previously been on the list at some point. For more on the CBOE’s weekly options see here, or see my guest post in the August issue of the online …
Update redirected to https://www.sixfigureinvesting.com/2010/04/going-short-on-vix/ I do not recommend XXV. At its current price of around $30/share it does not deliver the sort of performance you would expect an inverse volatility security to deliver. This security can go no higher than $40 per share and can only get there slowly. See this post for more information. If you want to be short volatility use XIV …
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 …
I’m back into USO after selling my shares and buying back my 24-September S33 calls last Friday for a net credit of $32.97 per share. Bought USO this morning at 33.01, sold-to-open S33 calls at $0.44. Breakeven is 32.57, maximum profit is $0.43 per share. Best case this is a 1.3% return for a 5 day investment.
