Since November 2009 I have been noting that the S&P500 (represented here by SPY) has been closely retracing the path that it followed in 2003 and 2004. Now that 2010 is drawing to a close, I took a look back at 2005 to get one vision (hallucination?) of what lies ahead for 2011. My updated graph showing SPY, normalized SPY volume and VIX over those …
For updated information see this post.
For updated information on SPY, IVV, and VOO dividends see this post. Some dividend related info: Excluding market action, Stock/ETF prices will drop by about the dividend amount when opening on their ex-dividend date. The equity no longer carries the value of the dividend, so it drops in value. The 500 stocks comprising the S&P index don’t go ex-dividend en-mass on the 17th, so the index …
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 …
Any strategy that hopes to offset down days in the market with volatility products that go up on those same days needs to figure out how much leverage the volatility product provides. A little calculation produced the equation below for computing the expected price of Citigroup’s CVOL from the VIX index quote: (VIX – 10) * 9.6 = CVOL So if the VIX jumps …
