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Thursday, October 22, 2015

Spiders (SPY) Put Options

7/21/2015 (11:38:56 am, PT)  FP

sold  -4 August 28, 2015  $205 puts at $1.30

probability of success:  75%

Note:
  • I was impatient and sold (to open) these puts even though the timing was horrible (i.e., the stochastics were in the "overbought" region)
  • On August 28 (expiration), these options did, indeed, end up in-the-money



8/21/2015 (7:42:02 am, PT)

Roll all 4 August $205 puts to October 2, 2015  $200 puts
Net credit:  $0.45

Note:
  • The net credit of $0.45 is very small, but I wanted to roll down my strikes for safety.



8/24/2015 (6:59:29 am, PT)

The Dow dropped 1000 points at the Opening Bell.


Roll all 4 Oct 2, 2015  $200 puts to November 2015  $200 puts
Net credit:  $1.55



10/22/2015 (10:33:11 am, PT) 

buy back all 4 Nov 2015  $200 puts at $1.58

Why did I close this trade?
  • stochastics in overbought region
  • SPY up 1.69% today

GROSS PROFIT:  $688

Success!




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