Opening Nov17 Short 259.5C and 256P Long Nov24 260.5C & 255P
Double Calendar spread actually a tiny bet on little movement of SPY before Friday
Debit $20/contract.
Theta 14
Will take the short legs off with any sign of price jumping or within 2 days. A big price jump without the short legs could improve the profit so will be watching this closely and out by Friday.
This time leverage can be powerful, that 14 Theta is because the longs will lose around 11 while the shorts are losing 25 in a day netting $14/day (here's the hitch, true if all else stays the same). An up move without the shorts will profit quickly but a down move even more so as the volatility should pop up increasing the value of the longs that I will be selling to close. We will see. Thanks for looking and keep smilng!
Debit $20/contract.
Theta 14
Will take the short legs off with any sign of price jumping or within 2 days. A big price jump without the short legs could improve the profit so will be watching this closely and out by Friday.
This time leverage can be powerful, that 14 Theta is because the longs will lose around 11 while the shorts are losing 25 in a day netting $14/day (here's the hitch, true if all else stays the same). An up move without the shorts will profit quickly but a down move even more so as the volatility should pop up increasing the value of the longs that I will be selling to close. We will see. Thanks for looking and keep smilng!
Trade closed manually:
Closed manually at a scratch on price so down commission and fees only. Would have come out better in either of 2 ways: 1. closing the shorts (-25) at market open this morning would have let me profit in the longs at the point where I bailed out. Or 2. If I had waited to be right the price bounced a bit later and the whole spread would have profited a few dollars. The way it dropped I was watching the probabilities of profit decrease and it was too late to buy off (close) the shorts as they were into higher losses alone to where the longs were less likely (they would not have) to profit alone later. Good training - the whole point of this trade was to be more comfortable with diagonals.