biotrader1, Having a bad day? It's the second time I get such comment as yours in my close to 2 years of trade journal posting here.
Why would a few hundred mean something? A few hundred options are just 20K to 30K shares. It will just move a couple of cents in liquid stock if it moves at all. I sell 1 call, 100 shares short equivalent, for stocks higher than $400, like AZO, each entry. I use '1 set' not to disclose exact shares when they are much larger compared to others.
Most of my 5 calls sold expiring worthless gives me 1000 bucks. Not sure about you but it's good enough for me if I can do it just a couple of times a week.
My goal 2 years back was 200 bucks per day, now it's cash for life equivalent. My pursuit in trading was:
find a way to make small amount of money consistently, and then can make larger amount consistently with increased fund.
It's not that simple but it's been working out for me. Started trading with everything I have, went through ups and downs, went back to break even 2 years back, now it's quite close to 6 times of what I started with, with a lot of luck and with the help of VXX. Of course most likely it will go back down again, but still been very lucky to become my own Rockefeller.
Just teasing, putting me on ignore is just 2 clicks away. Good luck trading!
I ran some numbers to see how UNG/UGAZ/DGAZ behaves when NG goes down to $2 and then back up to $4.25 for 3 different scenarios:
Scenario 1: NG goes down straight to 2 and then straight back to 4.25, unlikely scenario
-10% -10% and then -6% would put NG future to $2.
UNG 10.19, UGAZ 1.03, DGAZ 17.37
8 times of 10% puts NG future to $4.28
UNG 21.84, UGAZ 8.39, DGAZ 1.00
Scenario 2: NG goes down 10% then goes up 5% and repeats this till 2, then it goes up 10%, down 5%, and repeats this till 4.37
5 times of (-10% +5%) puts NG future to $1.98
UNG 10.08, UGAZ 0.87, DGAZ 14.35
Then, 18 times of (10% -5%) puts NG future to $4.37
UNG 22.27 UGAZ 5.22 DGAZ 0.29
Another scenario similar to 2 but with -2%, 1%, 2%, -1% instead of -10%, 5%, 10%, -5%
NG $1.01, UNG 10.25, UGAZ 1.10, DGAZ 17.95
NG $4.26, UNG 21.72, UGAZ 9.40, DGAZ 1.49, this takes forever though.
Actual will be lower for UNG and UGAZ if there is contango in NG futures. It seems UNG is quite consistent regardless of how NG gets to 2 and back to 4.
It is just amazing to see NG pressed down on these cold weather and possible large draw coming up for a couple of weeks. Maybe, the big guys know otherwise.
On the other hand, if it was that obvious, NG going up on a couple of weeks of very cold weather. Everyone would have made money. Tough to be long, tough to be short.
My take is winter is over this week. colder weather in March may not affect NG storage that much given production capacity this whole winter, unless it's cold enough to freeze production, which I don't think is the case.
Sold 10 WBA May/1st ATM calls.
Sold 5 CHL Apr OTM calls.
Sold 1 set of UNG Jan 2015 ITM puts to finance
Buying 1 set of UNG Jan 2015 ITM calls.
Restarting UNG long in almost 2 months, this time I will hold for longer, and add on maybe every $0.5 down.
Today's entry break even is $13.00, If UNG goes over $15, cost basis is $11, if it goes under $13, cost basis is $14.
It's amazing that $24 VXX can go down almost the same absolute amount as $208 SPY going up. More downside ahead when front future expires next week if market holds current level. Futures contango is at very nice 12%.
You're are blaming a wrong thing. Blame VIX future traders if VXX doesn't move as much as VIX. VXX does not follow VIX, it is designed to follow VIX futures and majority of VXX current holding is next month futures and it has a little bit of front month futures. Studying VXX a little bit that you trade won't hurt.
Chased SYK, BRCM, SKX today but failed to sell calls on any of them.
VIX below 13, waiting for it to break down below 12.5 which was recent support.
Gold sunk today but JDST is not up that much. Still have some JDST deep ITM calls sold left, waiting for higher JDST before re-selling calls covered.
Debating whether to short market more or sell VXX deep ITM puts against short shares to prepare for VXX bounce when the time come. Hoping that I get through this earnings season with minimal casualties. Life is good.
Oh! Spammer himself spotted his competition? You are named as spammer in multiple boards, LOL.
At least I don't delete my post when things don't go the way I wanted.
Judging by your remaining post, you must be very rich, knowing when to sell, when to buy, when the bottom is in, when set to pop, when pump is over, when set to soar, when is dead cat bounce, when dumping is coming, when big buyers/sellers are, what pros are doing, when boold-bath is coming, when it topped, etc., etc., for multiple stocks/ETFs, with occasional "told ya"s.
I can see you trying so hard to help out retails. Once a day is enough for me. Good luck trading.
Finally, VIX below 12.50, VXX ATL.
Sold 1 AMZN Jan 2016 ATM call on 15% earnings pop, planning on 1 call per every 10 - 20 move up (moving to closer month call each time)
Sold 5 SKX Oct near-the-money calls.
Bought 30 DPZ May deep ITM puts.
Bought 10 YUM next week deep ITM puts.
Account started to shrink on earnings hit and market shorts going up. Cannot avoid market shorts due to large number of VXX shorts. Really don't want to close any VXX shorts, otherwise, need to pay minimum of $4 - $5 tax per VXX share as lowest short price for current VXX shares short is about $33, while highest is about $88.
Started to short using deep ITM puts long again to preserve cash. Been adding stock positions without closing any for about 2 months, except JDST/TBT/EUO and stock options expired worthess. Will have to restart weekend option rolling from next week. Past couple of months were good without much of Friday option rolling. Still waiting for clear break out ATHs before starting SPY short. This earning season is not looking good for my account.
billy, I think it may start to go up well before the worst in storage is over. When big money sees recovery in sight say 3 - 6 months out, money may start flowing in, before the worst moment or before the worst is over in storage, just like it's rallying on news of under-performing rigs coming offline while storage keeps going up.
I enjoy reading your posts. You are like a scholar focusing on the fundamentals, but if I may say, I think there's alpha such as sentiment or anticipation that matters as much. I'm also waiting for oil and NG to come back down again, but I'm not that patient and my planned entry or addition is much higher than yours. Good luck trading.
Closed 7.4K JDST shares short assigned from calls sold. Rolled the rest of JDST short shares assigned from Mar calls sold to Apr calls. Lucky that it went down today below the strike price at which they were assigned.
Shorted 1K TGT shares. Retail shares are flying these days. Betting that it will end with the earnings, either by bad weather impact or oil price recovery. But not sure when oil would recover.
2 sets of USO Mar puts sold assigned long last Friday. So, total of 5 sets of USO long shares now. Hope it comes back down below 16 one more time. WTI crude future contango is a concern here.
VXX again bounced off ATL. Not a very good sign.
Account ATH again, more than 4 months after the last ATH. It's been difficult times especially on DEC, JAN and FEB. Account sunk big time with USO long and UAL short, recovered mostly with VXX short, JDST short, and lots of other small gains here and there.
Got hit by JDST. First time seriously shorting 3x ETF to take advantage of volatility decay.
Hate 3x ETFs that don't have short shares available. Been selling JDST Mar deep ITM calls to short JDST (i.e., long junior gold minors), MON & TUE. Got assigned those calls 3 days in a row.
MON & TUE, covered assigned shares and sold again deep ITM calls (higher strike) to keep short position.
Today, got very lucky, covered 11K JDST shares short at close to day's low towards market close.
I couldn't cover and sell another calls today because I ran out of fund. It's not over yet, but very much thankful.
Couldn't even consider getting into USO today due to the JDST mess in my account.
Thought JDST will have certain level of inverse correlation with Gold, but it seems that it has its own life, going its own way. Should have started with smaller position and added slowly. Luckily, at least JDST is lower than break-even short price now. After all these years of troubles, still trade this way once in a while. Hope I close this trade with good gain.
Maybe, I should have closed some of VXX short when it hit 25, new ATL. I was expecting furhter down given $3 dollar contango between spot VIX and front month future. Spot VIX is at 13, it's early in the month for the front month future, but it has to come down unless spot VIX climbs higher, it has to come down to about $1.50, which is about 10% down in VXX. Contango between front month and next month futures is also not bad, close to 9%. Anyway, if VXX goes down close to $20 in short term, I would be holding onto all my VXX short shares. Then, I can entertain 50% spike from $20 to $30.
Closed 700 JDST share short assigned from call sold. Was hoping for JDST to pin at $10 so the calls that I sold expires worthless, but it didn't.
Just 25% of JDST Mar calls sold rolled to Apr today. Remaining 75% of JDST Mar calls will be assigned, so, a lot of JDST covering and Apr call re-selling to do on Monday,
Rolled EUO Mar calls sold to Apr.
Shorted 750 shares of KSS. Adding little by little to market short to hedge VXX share shorts. It got reverse, I used short VXX to hedge market short, but not until SPY makes another leg up through ATH. FB, EXPE, TGT, HD flying. When to start shorting FB is the question, 85 or wait till 90.
Account good today, less than the day's peak but still good.
Just got back from snowboarding, rolling options while sitting on the lift way up, took half day off from work, drove through snow to the mountains. Snow was so good today, warm weather nice snow. Feels real good cruising down the mountain over fresh light snow that nobody put their feet on.
Another VXX ATL but bounced off the low again. Market gets weak towards closing 3 days in a row. Hoping for change tomorrow. Otherwise, may sink.
Sold 5 FSLR weekly ATM calls. Needed several hundred bucks to buy something. Thought I would get the money from market and buy it. Been thinking of this for some time like: When I need to buy something, sell calls that are less likely to get assigned up to the amount I need. So, this is experiment. I should have sold higher strike longer dated calls to much safely make that money but earning is coming up and didn't want to drag this longer.
Preparing tax, going through trade records to classify wash sales used & carried over to 2015, carried over positions closed, positions carried over to 2015. Almost done for smaller account, another larger account still to go. Mis-managing wash sales on DEC and JAN ruined income tax for 2014. I could have managed much better, but was under too much stress DEC & JAN and dropped ball on some of important large positions causing huge wash sale, due to ITM option roll failure.
SHOULD DO BETTER THIS YEAR END. Hope I don't forget this by then...
Sold 30 JDST Mar deep ITM calls. Missed chance yesterday at close, same place today at close but not at the best price. Hope this is not a mistake.
Kept chasing morning spikes on KSS, TGT past couple of days but couldn't click the button. Just like last year, bad winter should pressure mall retailers and travel service companies. They are still strong so trying to short some.
VXX is refusing to go down further. Hope tomorrow's jobs report doesn't damage my account.
My son's school was closed today due to heavy snow. Took half-day off from job, and went to snow boarding with him to enjoy fresh snow, driving through snow for a long time, a lot of chat time with him. Didn't have much new snow there while where I live got a lot of snow today. Even so, it was refreshing, had very good time today with him. I was sweating at 15 degrees on the mountain, temperature was low, but no wind made it feel less cold. I've been missing it this winter, stuck on trading and other things that were going against me. Hope I get a couple of more chance to snowboard before this season is over.
Today, just 300 JDST shares short assigned from deep ITM calls sold, covered them when it dropped later in the day.
Shorted 500 TGT shares. Waited and waited for it to break through the resistance. It didn't look like it will, so I finally shorted. Then, just a couple of minutes after I entered it broke through the resistance.
Finally, sold 1 set of USO next week puts right before close.
Winter is over. Thinking NG future will see $2.5, if not below. Still waiting.
Hope VXX goes down for one more day, so I can close some of the short shares.
Sold 10 VXX weekly ATM calls. Again silly, shorting at tiny bounce, needed several hundred bucks again. Hope they expire worthless tomorrow.
Contango between spot VIX and front month future is almost gone, but contango between futures is still good.
Shorted 750 EL shares.
1st Q is almost done already, not bad so far.
Yeah, pinning happens all the time in futures, indexes, individual stock options on expiration. Sometimes, they keep it within +/-10 cents for several hours on expiration day and pin it to the precision of just 1 cent. This happens so many times but no one does anything about it.
Closed 4K VXX shares short that were shorted during recent mini-bump up. Still trade silly shorting on small bounce from low.
Closed 20 TBT deep ITM calls sold.
Closed 1K WHR shares short.
Bought 1 set of USO shares pre-market.
Rolled 5K JDST short shares assigned from Mar deep ITM calls sold to Apr deep ITM calls short.
Got some fund for paying tax today. Tax is giving me a lot of stress recently. Just ridiculous. Wish I can make USO long term gain.
Good day today, with JDST sinking, VXX, EUO, TBT down. If market does not tank tomorrow, we are looking at new ATL for VXX, with front future expired, spot VIX under 14, and new front month future at 16.50.
Sold another 10 VXX weekly ATM calls at close to high today.
All week, thought option premiums are fat thinking market will be closed tomorrow, just realized it's next Friday, silly.
Was hoping JDST would provide hedge to market fear, it did in the morning today, but then it moved independent of GOLD, independent of market. Waiting for volatility decay on this 3x. JDST short and USO long , similar number of shares, cancelled each other today.
Waiting for one more push down on UNG before starting initial long position. Prospect on UNG going up seems low, but will buy on its way down and then sit on it for a long time.
10 VXX calls sold expired worthless.
10 FSLR calls sold expired worthless.
10 SBUX calls sold assigned share short.
Was supposed to buy UNG near low today, decided to wait and it bounced a bit, hope I didn't miss the boat. Started to follow AZO.