Opening (IRA): IWM April 19th 176 Monied Covered Call
... for a 171.23 debit.
Comments: Buying stock and selling the -75 call against to emulate the delta metrics of a 25 delta put. This setup gives me a slight bump in premium over selling the 25 delta put due to call IV skew, along with built-in position defense with the short call.
Laddering out over time after flattening out at the end of the year. I'll naturally look to add in shorter duration if I can get in at strikes/cost basis below what I currently have on, but will probably continue laddering out to the end of the second quarter (June) for a bit here.
Will generally look to take profit at 50% max; look to roll out the short call to reduce cost basis further should price traverse the short call strike (since extrinsic is highest in at-the-money strikes).
Comments: Buying stock and selling the -75 call against to emulate the delta metrics of a 25 delta put. This setup gives me a slight bump in premium over selling the 25 delta put due to call IV skew, along with built-in position defense with the short call.
Laddering out over time after flattening out at the end of the year. I'll naturally look to add in shorter duration if I can get in at strikes/cost basis below what I currently have on, but will probably continue laddering out to the end of the second quarter (June) for a bit here.
Will generally look to take profit at 50% max; look to roll out the short call to reduce cost basis further should price traverse the short call strike (since extrinsic is highest in at-the-money strikes).
Trade closed: target reached:
50% max hit. In for 171.23; out for 173.62. 2.39 ($239) profit.