ROLLING: VXX FEBRUARY 21ST 14/16 SCV TO MARCH 20TH 12/14 SCV
... for a .41/contract credit and for a realized gain of .34/contract.
Notes: My preference would be to roll these down on strength, but staying mechanical and rolling out at 50% max of credit received. Total credits received now at 1.09/contract, so the roll also has the salutory effect of actually reducing setup risk; the max loss metric was previously 1.32/contract, and now it's .91.
To some, the short call might appear "too deep" in the money, but VXX (on average) loses about 6% of its value per month, so it's conceivable that if there are no major pops here that VXX could trundle down to sub-12 in the next 60 days. Naturally, if we do get a pop, I'll add units and go from there ... .
Notes: My preference would be to roll these down on strength, but staying mechanical and rolling out at 50% max of credit received. Total credits received now at 1.09/contract, so the roll also has the salutory effect of actually reducing setup risk; the max loss metric was previously 1.32/contract, and now it's .91.
To some, the short call might appear "too deep" in the money, but VXX (on average) loses about 6% of its value per month, so it's conceivable that if there are no major pops here that VXX could trundle down to sub-12 in the next 60 days. Naturally, if we do get a pop, I'll add units and go from there ... .
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.