So I've been getting into some naked puts, here's where I am so far.
Sold OIH May 70 put for .53 credit on 4/22.
Sold XLE May 40 put for .76 credit on 4/20.
Sold OXY June 45 put for .95 credit on 4/27.
Gotta take it easy with these, could go overboard.
Tackle Trading Halftime Report July 29th 2019
6 years ago
Posts
How did it go on these trades?
ReplyDeleteSorry, I haven't been on here in quite some time, I need to make a point to post my trades here for myself as well as others who are interested.
ReplyDeleteI've been going naked and short pretty much 100% for the last several months, I'm really getting into being theta positive. We all know the market makers are out to pick our pockets as often as possible, so why not put as many factors in our favor as possible? Time is the first factor we can get on our side. Time decay alone is our single greatest ally when selling options, since it can't move against us and can't be controlled by the market makers. The next factor the market makers can't control is implied volatility, which is really a measure of market sentiment or bias. Historically, volatility ramps up as earnings season approaches and falls after earnings are reported. We can easily use this common behavior to our advantage, since the higher the volatility, the bigger the option premium.
I have been putting on naked puts and short strangles exclusively, and slowly building my account back up after some bad decisions early on. It's such a temptation to go "all in" long calls and puts and hope for that huge move that will triple our account, but I've learned the hard way that I'd be better off in a casino, since I would at least be getting some "free" drinks while I lose my shirt.
I will do my best to post my new trades here as I make them. Here is a brief synopsis of my closed-out trades since April, and the profit/loss on each:
ReplyDelete(L/S)
(S)XLE May 40P, +.87
(S)OIH May 70P, +.66
(S)OXY Jun 45P, +.85
(S)JEC Jun 30P, +.54
(L)SQNM May 5C, -.75
(S)PNRA May 50P, +.30
(S)BBBB Jun 25P, +.55
(S)BBBB Jul 25P, +.58
(S)OIH Jun 80P, +.55
(S)AZO Jun 145P, +1.8
(S)PLCE Jun 30P, -.40
(S)AMSC Jul 20P, +.35
(S)VRSN Jul 17.5P, +.48
(S)XME Jul 32P, +.05
(S)AZO Jul 145P, +1.3
(S)GS Aug 130P, +1.34
(S)FDO Aug 25/30 strangle, -.44
(S)CSX Aug 27/35 strangle, -3.63(yes, it's true)
Trades I'm currently in, and the credit received:
(S)WAG Aug 27P, $.60
(IC)WMT Aug (S)47.5/50, (L)42.5/55, $1.66
(S)JEC Jul 35P, $.25
(S)DIN Aug 25/40 strangle, $1.3
(S)WHR Dec 35/70 strangle, $3.05
(S)AZO Aug 140P, $.85
As you can see from the first list, I had a bunch of modest credits that got nearly wiped out by a big loss in one of my first short strangles. CSX gapped up the day after earnings so I legged out of the put for a .50 gain, then I figured I'd hold out for a couple days until it filled the gap. Well, the meteoric rally last week cleaned my clock, and I stayed in way too long, expecting a pullback that has yet to materialize. I got out of the call this morning at a $4.13 loss.