As calls got closed a few days ago and puts slipped in the money (ITM) I decided to roll puts down and sell new calls against it:
Although now the trade has a very narrow window for both legs to expire or be bought back for nothing (and actually I do not expect it much) I am OK with this trade.
If the stock continues slipping down, the calls may get actually closed again and later on, if we see a recovery, the puts can get closed. This will not be a bad idea necessarily.
UPDATE: June 07, 2017
Today, as TECK continued slipping down, our calls closed:
BTC 1 TECK Jun30 21.00 call
@ 0.05 debit limit
Remember, after I open a new trade, I immediately place a GTC buy back order for 0.05 debit. The order then hangs out there with my broker until either canceled or closed.
I still hold the put side of this trade waiting for it to either close for a 0.05 debit or, if the stock continues lower, roll it.
Original Trade: May 30, 2017
I decided to open another strangle using TECK Resources underlying.
One reason I like to trade this stock is that it is cheap (the buying power requirement was only ~$189 dollars) and it still provides a decent implied volatility for the trade.
Here is the trade detail:
STO 1 TECK Jun30 16.50 put
STO 1 TECK Jun30 21.00 call
@ 0.40 credit limit
TECK @ 18.76
trade IV: 43.41%
The trade executed for 0.41 credit (or $41 dollars).
I plan on holding this trade until expiration and also opening new trades in a ladder style. That means that I would create a series of trades expiring every week.
Loading ...
Leave a Reply