
In brief, my own trade today was auspicious, though it could have used more luck still. I exited the Vix Nov 22.5 calls which I had entered on Monday, as I found myself increasingly spooked to be holding a November-expiry option (which I shouldn't have entered at such a late stage). Lucky for me, the market was unexpectedly holding up the expected volatility on these options -- and hence their time value, too. I was able to sell at a decent profit.
Yet my timing was unlucky. I sold early in the 13:00 (CST) hour, as the markets seemed poised to gain ground (which would have caused my Vix calls to undoubtedly depreciate). But it was only a head-fake. Immediately after the sale, I left for an invigorating run at my gym and, upon returning, found the markets down a further three-quarters of a percent. But I'm not bothered by having left money on the table; trading is a profession of managing probabilities, and I acted in accordance with my best analysis. To end the day, finally, I entered a position in COF December-expiry puts, essentially placing a bet that markets will continue their decline into tomorrow's session. I chose COF (Capital One) as it pierced through a significant support level -- $38.75 -- just prior to today's close, which makes further declines more likely. I see support around $36.00. As for the S&P500, a decline to at least 1080 certainly seems plausible, which would in all likelihood afford me a profitable exit opportunity from the COF puts. A 10-day of COF follows:

Happy hunting! Give it 480 percent, your bestest! (Yes, the latter is a tribute to the one and only Martin Lukes of a-b global, suddenly resurrected in the pink pages. What joy!)
No comments:
Post a Comment