NaughtyPines
Short

OPENING: XLK AUG/SEPT 72/76 DOWNWARD PUT DIAGONAL

AMEX:XLK   SELECT SECTOR SPDR TRUST TECHNOLOGY SELECT SECTOR
.... for a 2.74/contract debit.

Metrics:

Max Loss on Setup: $274/contract
Max Profit on Setup: $126/contract
Break Even: 73.26
Debit Paid/Spread Width Ratio: 2.74/4 or 68.5%
Theta: 1.14
Delta: -39.63

Notes: Selling semicons on strength. Will start to look to take profit at 50% of max.
Trade active: Rolling the short put aspect up and out to the Sept 73 strike for a realized gain and a .93/contract credit. Scratch at 3.67, but max profit potential is now just the width of the spread (3.00).
Comment: Correction: This was a 2.74 debit trade, so the .93 credit reduces the cost basis to 1.81.
Comment: Weirdly enough, although the setup's moved against me, the max profit potential remains about the same: the width of the spread (3.00) minus cost basis (1.81) or 1.19 versus the original 1.26. That being said, still sticking with my original profit target of about 50% of max (.63/contract).
Trade active: Managing this aggressively: rolling the Sept 21st 73 short put to the 74 for a .34/contract credit; scratch at 1.47. I tend to do this when I can no longer roll out and the trade has not worked out fairly immediately (it hasn't). Of course, then FB happens ... . Lol.
Trade closed manually: Covering for a 1.45/contract debit, so basically scratching this trade out. Next time around, I'll be less aggressive with the rolls.
thanks amigo
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