... , one high implied volatility (HTZ), two low implied volatility (TLT, GLD), and one long-dated bullish assumption oil trade (XOP).
High Implied Volatility
HTZ "Monied" Covered Call
Buy 100 Shares at 16.96
Sell Oct 20th 15 call
13.99 db (your cost basis in the shares)
1.01 max profit if called away at 15
Notes: Roll the short call out for additional cost basis reduction if it doesn't finish at 15 or you can't exit the trade before expiry around that mark. It's only got monthlies, so some patience may be required if you are unable to get your candy right away. An alternative approach would be to sell the 12.5 short put in the Oct 20th expiry (currently trading at .50) and then look to cover (monied or otherwise), if assigned.
Low Implied Volatility
Both TLT and GLD are in low volatility territory here, so look to deploy low volatility strategies on them ...
TLT Sept 15th/Dec 15th 125 put calendar
1.87 db
GLD Sept 15th/Dec 15th 121 put calendar
1.63 db
Notes: Roll the short put aspect out for duration "as is" on significant decrease in value, and look to exit the trade at 20% max of what you put it on for. Obviously, not "big money" plays, but also not big buying power pigs either ... .
Long-Dated Neutral to Bullish Assumption Oil Trade
XOP Oct 20th 31 short call/March 16th 21 long call Poor Man's Covered Call
8.06 db
Notes: Roll the short call aspect of this setup out for duration and credit to reduce cost basis in the setup and look to exit the trade for 10-20% max of what you put it on for. For a longer duration setup with the potential to reduce cost basis in the entire setup to zero over time, consider the Oct 20th 31 short call, Jan 18th '19 20 long call Poor Man's for a 9.54 db. An alternative instrument to consider which is also oil sensitive is XLE, although a similar setup comes with a heftier "entry fee" -- the Oct 20th 65 short call/Jan 18th '19 50 long call costs 12.29 to put on.
High Implied Volatility
HTZ "Monied" Covered Call
Buy 100 Shares at 16.96
Sell Oct 20th 15 call
13.99 db (your cost basis in the shares)
1.01 max profit if called away at 15
Notes: Roll the short call out for additional cost basis reduction if it doesn't finish at 15 or you can't exit the trade before expiry around that mark. It's only got monthlies, so some patience may be required if you are unable to get your candy right away. An alternative approach would be to sell the 12.5 short put in the Oct 20th expiry (currently trading at .50) and then look to cover (monied or otherwise), if assigned.
Low Implied Volatility
Both TLT and GLD are in low volatility territory here, so look to deploy low volatility strategies on them ...
TLT Sept 15th/Dec 15th 125 put calendar
1.87 db
GLD Sept 15th/Dec 15th 121 put calendar
1.63 db
Notes: Roll the short put aspect out for duration "as is" on significant decrease in value, and look to exit the trade at 20% max of what you put it on for. Obviously, not "big money" plays, but also not big buying power pigs either ... .
Long-Dated Neutral to Bullish Assumption Oil Trade
XOP Oct 20th 31 short call/March 16th 21 long call Poor Man's Covered Call
8.06 db
Notes: Roll the short call aspect of this setup out for duration and credit to reduce cost basis in the setup and look to exit the trade for 10-20% max of what you put it on for. For a longer duration setup with the potential to reduce cost basis in the entire setup to zero over time, consider the Oct 20th 31 short call, Jan 18th '19 20 long call Poor Man's for a 9.54 db. An alternative instrument to consider which is also oil sensitive is XLE, although a similar setup comes with a heftier "entry fee" -- the Oct 20th 65 short call/Jan 18th '19 50 long call costs 12.29 to put on.