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iPath S&P 500 VIX ST Futures ETN Message Board

  • goodoptday goodoptday May 28, 2014 4:01 PM Flag

    VXX 5/27/14 & 5/28/14

    5/27/14:
    Closed 200 UNG shares short assigned from deep ITM calls sold.

    5/28/14
    Sold 10 VXX Jun deep ITM puts against core shares short. Playing a dangerous game, would lose core shares short if VXX goes down further and get assigned. Would prefer to sell SVXY but lacks fund.

    Closed calls sold at half of expiration gain to make funds available for rolling of UNG shares short assigned from calls sold.
    JWN(5x2), EL(5)

    Rolled 31 UNG calls assigned.

    Account big minus. Betting on a dip however small it may be, a couple of market shorts still weak and hope it stays that way for a couple of more days. Another firework coming tomorrow upon NG inventory report. Hoping for breathing room tomorrow both from market and UNG.

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • OpGuy:

      You might consider pursuing the matter with a manager.

      You VXX short should be held in a "short" subaccount.

      If those puts are exercised, those shares should be put directly into tight margin.

      To close out the box, those new long shares must be "journaled" into the short account.

      Yesterday, I unexpectedly had the short leg of an SVXY call spread assigned and I found myself short a bushel of SVXY in my IRA -- a definite sin under normal circumstances. I proactively called my broker and was given until 13:30 pm to cover the short at a limit price before the broker would force the cover at mkt price.

      Perhaps you could come to a similar understanding with your broker to sell the new long position by day's end!

      Cheers,

      Bustin

    • "Sold 10 VXX Jun deep ITM puts against core shares short. Playing a dangerous game, would lose core shares short if VXX goes down further and get assigned. Would prefer to sell SVXY but lacks fund."

      OptionGuy:

      I don't get it. What you are doing is not "dangerous". Actually, you have simply hedged your shorts; did you mean OTM puts?

      Personally, with such exuberrant contango, I believe that the chance of VXX plunging in the next several weeks far exceeds the chance of it rising. I added to my TVIX short this morning when it popped and sold some OTM SVXY calls against near expiry existing deep ITM SVXY calls near the close.

      Some stranger also gave up a dime of premium to me this morning by assigning me the short calls of an SVXY call spread expiring Friday instead of just selling the option. I then watched SVXY tank another .50 before I covered the undesired short position!! As George and Ira once wrote, "Nice work if you can get it"!

      Bustin

      • 1 Reply to bustin_ur_chops
      • bustin, it's dangerous to me because if those deep ITM puts are assigned, it will take away my core VXX shares short and I have to pay about $15 per current share as tax for the gain accumulated for about a year.

        My broker doesn't make a box position when options are assigned. Instead, it just takes away whatever shares there are if there are.I asked them whether I can request them to make a box position upon assignment and they say no.

        I will have to experiment later whether I can sell new shares on the same day after put assignment and give the new shares short to the put assignment by using LIFO.

 
VXX
27.62-0.16(-0.58%)Feb 27 4:00 PMEST

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