Update Well, I was clearly wrong about people not being in panicky mood. Around 10:30 EST the market decided to take another leg down and the VIX did spike up quite a bit. Later in the day the market rallied back to around the point I created this position. I bailed out of my position less than an hour after I created it, …
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. …
Update: I do not believe XXV is a good way to short VXX, or volatility in general. It has very little upside remaining (maximum value will be $40/share), see this post for more details. ********************************************************** We know that Barclays’ XXV is intended to be an inverse fund of VXX, but there is some confusion regarding what kind of inverse it will be. Will it be the …
Looking at the 30-July version of AVAILABLE WEEKLIES spreadsheet on CBOE’s weekly page shows that next week adds some interesting options (USO, CSCO, DNDN, GE) , and drops some that were offered the week before (ABX, POT, XOM). Evidently the clever folks at CBOE are adding options for some stocks just for the week when they are reporting earnings. I suspect that USO, …
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 …
