Sunday, December 9, 2012

AAPL Iron Condor

http://screencast.com/t/oQqSvNeD

63 comments:

  1. Update:
    Took off AAPL 620/625 calls for $0.11 debit, 610/615 calls for $0.15 debit.

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  2. Update:
    Sold another vertical spread today to re-establish the iron condor. Unfortunately did it a bit too early so didn't collect nearly as much premium as I could have it I had waited till later in the afternoon, but that is the way it goes.

    Sold AAPL Jan 560/565 Call Spread for an avg. of $0.81.

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  3. Update:
    Closed out the put spread for $0.17 debit

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  4. Update:
    Sold Jan 515/520 Put Spread for $0.87 to reestablish iron condor.

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  5. This looks more like Iron Condor Strangle Hibride

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  6. No - it started as an iron condor, then rolled down the call verticals, then rolled up the put verticals. The risk has always been defined by spreads, there is nothing about this trade that resembles a strangle.

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  7. Hey Sandeep,

    I watched your Karen style SPX trade. Which I try to emulate as well. I am trying to replace short Calls with Long VIX calls. Any thoughts BTW your the only one who posts on this blog did the other guys stop posting.

    b1llmoo

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  8. Why would you want to replace short SPX calls with long VIX calls? Instead of collecting theta you would be losing it. If the market goes up your VIX call will become worthless. If the market goes up your short SPX call still has a very good chance of becoming worthless.

    Jason will probably post at some time, this is his blog. I never knew the other two guys at all, have no idea what their status is.

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  9. True But in this low vol environment wouldnt the "POT ODDS" be for vol to expand at some point in the near future and i would be selling Puts worth more than the Long Calls. BTW really enjoyed your breakdown of the Karen trade.

    b1llmoo

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    Replies
    1. I think the strategy would fail miserably. Even if vol expands the back month VIX options probably wouldn't move much while you lose theta every day, so you would just be hoping to make all your money on the front month calls and pray that you weren't getting killed on the short puts. However if you think it might work you could always try it on a very small scale and see what happens, keeps things interesting anyways.

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  10. Trade Update:
    Rolled down the 565/560 Call spread to 545/540 for $0.73 credit.

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  11. Sandeep,
    Was a strategic planning, that you did not get in the Money on either side,
    or mere luck

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  12. The trade is not over and the 520/515 put spread has been in the money intraday multiple times. I would just call it expected market movement.

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  13. Trade Update:
    Several adjustments made today as I am not very comfortable with the 520/515 put spread which has been in the money numerous times over the past few days.

    1. Sold 535/540 call spread for $1.30
    2. Sold 10 535 calls for $3.15
    3. Sold 20 530/540 call spread for $2.15
    4. Bought 50 520/515 put spread for $2.05

    Have added some risk to the upside with these trades and have removed some downside risk.



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    Replies
    1. Sandeep,
      very interesting
      1. Sold 535/540 call spread for $1.30 What quantity

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  14. Quantity was 104, same as original iron condor. Will make short video to show position.

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  15. http://screencast.com/t/D6CgJF49W

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  16. Hi Sundeep,
    Rolled down the 565/560 Call spread to 545/540 for $0.73 credit.
    What about 545/540 what did pay or are you still holding the spread
    Sold 535/540 call spread for $1.30

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  17. It is still there, it is just an embedded position now. It started as
    -104 545/540 call spread. Then sold 104 of the 540/535 call spread so position becomes
    -104 545/535 call spread
    Then sold 10 535 calls, etc...

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  18. Obviously position has now become more complex than the simple iron condor, and his now a combination of unbalanced iron condor, short call spread and short calls.

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  19. AAPL trading around $500 premarket - ugly. Was not expecting this, but fortunately the adjustments I made the other day will end up saving this trade.

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  20. Given your risk graph after all your adjustments, this seems like a pretty favorable move for this position. With the caveat of your other stock position in the other account.

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    Replies
    1. After my adjustments I was not going to lose on this trade if AAPL took a big dive, but my trade would definitely have been much more profitable if it would have just stayed above %520 for a few more days.

      Delete
  21. Hi Sandeep
    If you take profits now you are way ahead,
    like this risky play if it works

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  22. Trade Update:
    Took of the remainder of the 520/515 Put spread at the open for $3.94 debit.

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  23. Trade Update:
    Closed 530/540 Call spread for $0.60 debit

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  24. Trade Update:
    Sold 10 475 Puts $1.18 credit

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  25. Trade Update:
    Closed 104 of the 535/545 call spread for $0.39 debit.
    Remaining position is now:

    -10 475 Put
    -10 545 Call

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  26. Correction:
    Above post should state remaining short call is the 535, not 545.

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  27. Trade Update:
    Sold 10 475/535 strangle for $2.26 credit. Position is now:

    -20 475 Put
    -20 535 Call

    Unless there is another big move that should be the end of trading in this position for today.

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  28. Hey Sandeep, I know it is kind of a random question. But what is your commission rate for options within your TOS platform? I only ask because with all your volume, I hope you have a decent rate.

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  29. I think it is $5 plus $0.65/contract in this account.

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  30. I guess that is decent and probably works out better given your volume. I can't remember if Jason or I ever shared this with you. But we have a rate of $0.75/contract with no minimum fee.

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  31. I have that same deal in my PM account.

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  32. Trade Update:
    AAPL looks like it's closing weak so at the bell closed out the short puts for $1.33 debit.

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  33. Trade Update:
    Sold 20 of the 475 Puts for $1.51 at the open.

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  34. Trade Update:
    Damn, too early now that thing is going for $2.05
    Rolled 535 calls down to 515 for $0.91 credit.

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  35. Trade Update:
    Rolled 515 calls to 510 for $0.57 credit

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  36. Trade Update: AAPL still ugly, decided to reduce my deltas so sold 10 more 510 calls for $1.53 credit.Position is now:

    -20 475 Put
    -30 510 call

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  37. Trade Update:
    Rolled 20 510 calls down to 505 for $0.72 credit.

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  38. Trade Update:
    Delta of the 475 puts got up to 0.30, so decided to buy a little more room. Rolled 475 puts down to 479 (delta 0.21) for $1.15 debit.

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  39. Trade Update: Sold 10 465 Puts for $1.42 since it requires no additional capital given the extra calls I sold. Decided it's worth a shot to make some more money on this trade as I have already spent more time working this then I intended so I would like to get paid for it. Position is:

    -10 465 Put
    -20 470 Put
    -20 505 Call
    -10 510 Call

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  40. Trade Update:
    Looks like it may have made a bottom so rolled up 465 Puts to 470 for $0.54 credit.

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  41. Nice work Sandeep.. Looking forward to video update... Would you say the most critical point is to roll early when in trouble.

    b1llmoo

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  42. No - I would say the most critical point is to trade in a size small enough that you can stay in the trade when it goes against you and be able to adjust it as needed, as I have been forced to do multiple times with this thing.

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  43. Trade Update:
    Rolled 505 calls up to 510 for $1.94 debit
    Rolled 470 puts up to 490 for $1.18 credit

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  44. Rolled 490 puts to 500 for $2.28 credit

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  45. Currently closing trade for this position is $6.83. With a little luck price will stabilize and this will come in - we shall see.

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  46. Keeps going up so rolled up 500 puts to 510 for $4.27 credit.

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  47. Hey Sandeep. I would love to see a post trade summary and analysis of this trade once you completely close it out. If you would like to share.

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  48. Current position is now short the $510 straddle. Came in a little bit toward end of day, to close is now $11.13

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  49. Pre-market no large move, so hoping for an inside day today. Goal will be to close out trade today for under $9 which should be possible if there if the stock just rests a bit.

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  50. At the open, closing trade going for $9.80. Will put in order to close for $8 and see what happens.

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  51. Change of strategy - will try to leg out of this, so just closed the calls for $2.82 debit. Need a rally and will close puts.

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  52. Making it difficult. Sold the 515 calls for $1.90 since it is not rallying much.

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  53. Closed 515 calls for $0.74 debit.

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  54. Sold 510 calls for $1.60 credit

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  55. 510 straddle finally coming in a bit, now at $8.86. Have my order to close at $8.40, will see what happens.

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  56. The bells go off and this trade finally comes to an end with closing out the 510 straddle for $8.40 at 12:57 pm CT. Under normal circumstances I might have held this till tomorrow and tried to take some more out of the trade, but I am leaving on a trip halfway around the world tomorrow afternoon so I do not want the risk of holding this overnight and dealing with it tomorrow, especially with earnings coming out so soon. I have a pretty good idea of how this has worked out but will post summary tomorrow after updated data from today's activity downloads to spreadsheet.

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  57. End of day, AAPL under $503 and that straddle at $9.27 so glad I took it off when I did.

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  58. http://screencast.com/t/1DGXONIIk3Ty

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