XBI -- HIGH VOLATILITY SPDR IN THE ROUGH
With volatility having bled out of the broad market indices, I'm looking for any premium selling plays (in addition to earnings plays) that I can find.
With an IVR rank of 75 and at or near all-time highs, XBI (S&P Biotech ETF) presents a possible premium selling play via short strangle or iron condor.
Possible set-ups:
Aug 21 235/240/300/305 IC; 66% POP; BE's at 238.77/301.23; 1.23 credit; BPE $377.
Aug 21 240/300 short strangle; 72% POP; BE's at 235.32/304.68; 4.68 credit; BPE undefined.
NOTE: Ordinarily, I prefer to go as near to 45 DTE on initial set-up as possible. It is possible that because I'm looking at set-ups in off hours that some strikes are "off quote" or that the prices of them are currently unavailable, particularly for the Aug 28 weekly expiry, which is 41 DTE and more ideal for my purposes.
Additionally, I am tempted to go with a contrarian play and skew any IC/strangle set-up to the bearish side (it is, after all, at all-time highs). However, I am resisting the urge and will play this SPDR neutrally.
With an IVR rank of 75 and at or near all-time highs, XBI (S&P Biotech ETF) presents a possible premium selling play via short strangle or iron condor.
Possible set-ups:
Aug 21 235/240/300/305 IC; 66% POP; BE's at 238.77/301.23; 1.23 credit; BPE $377.
Aug 21 240/300 short strangle; 72% POP; BE's at 235.32/304.68; 4.68 credit; BPE undefined.
NOTE: Ordinarily, I prefer to go as near to 45 DTE on initial set-up as possible. It is possible that because I'm looking at set-ups in off hours that some strikes are "off quote" or that the prices of them are currently unavailable, particularly for the Aug 28 weekly expiry, which is 41 DTE and more ideal for my purposes.
Additionally, I am tempted to go with a contrarian play and skew any IC/strangle set-up to the bearish side (it is, after all, at all-time highs). However, I am resisting the urge and will play this SPDR neutrally.