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Shortput

OPENING: SPY OCTOBER 16TH 276 SHORT PUT... for a 5.52 credit. Notes: A delta under hedge in the first expiry in which the at the money short straddle pays more than 10% of the share price (currently in October). Scratch at 81.99 versus current setup value of 88.02; delta~21; theta 22; extrinsic of 44.89. I'm approaching the max that I want to devote to working my way out of this trade, so will potentially look at delta adjustments using existing units as opposed to additive ones going forward.
AMEX:SPY
by NaughtyPines
OPENING ("THE KID"): HYG DEC 20TH 87 SHORT PUT... for a .95 ($95) credit. Notes: She's gone quite aggressive here, selling the first out-of-the-money strike with a break even at 86.05. She'll look to roll for duration on extrinsic approaching zero to the first out-of-the-money short put for a credit or, at the very least, toward current price for a credit, looking to emulate HYG's annualized dividend (currently 4.56) without actually being in the stock. She said she's fine with taking assignment at 86.05, but would prefer reducing cost basis "as much as possible" before taking on shares. She liked my "not a penny more" idea (See Post Below), called it "nice" but "not aggressive enough." Kids nowadays ... . We'll see how her "aggressive" goes.
AMEX:HYGLong
by NaughtyPines
4
TRADE IDEA: APA JAN 17TH 20 MONIED CC or JAN 17TH 20 SHORT PUTWith broad market and exchange-traded funds being temporarily unproductive from a premium-selling standpoint, I've been scouring the earth for high rank/high implied underlyings. APA (100/74) is one of them with earnings in the rear view. Pictured here is a monied covered call with the short call at the 20 strike in the January cycle. Markets are showing wide here (16.05/17.70/19.34), most of which is due to after hours pricing of the stock, which ended the regular session at 23.22, with the short call at 4.17 at the mid, implying a possible fill of 19.05 with .95 max for the monied covered call (5% ROC); the same strike short put pays .91 at the mid with a cost basis of 19.09 if assigned, so it's six of one, half dozen of the other in a cash secured environment, but greater buying power efficiency on margin by going short put over the covered call. Go less monied with the call -- at the 22.5 strike, and you're looking at potential 20.65 fill and 1.85 max (9% ROC); the 22.5 short put pays 1.76 with a cost basis of 20.74 if assigned.
A
by NaughtyPines
OPENING (IRA): XLP JAN 17TH 52 SHORT PUT... for a .40 credit. Notes: Another "not a penny more" short put with a resulting cost basis of 51.60/share if assigned. As with my XLU and HYG not a penny mores (See Posts Below), will look to roll "as is" for a credit on at least a quarterly basis until assigned or that's no longer productive. Current yield of 2.99%; $178 annualized on a one lot ... . This trade kind of rounds out what was on the remainder of my IRA shopping list which has focused on dividend yielders like IYR, HYG, XLU, and XLP. I'm already in IYR covered calls and in HYG and XLU short put plays.
AMEX:XLPLong
by NaughtyPines