ROLLING: XLU DEC 2ND 45/48.5 SHORT PUT VERT TO DEC 23RD
After I pulled off the short call of the Dec 2nd iron fly at near worthless today, I rolled the short put side out to the Dec 23rd expiry to give it a little more time to work out, as well to be able to work the call side of the setup effectively. (I have a setup in the Dec 30th expiry already, so didn't want to roll there; Jan was too far out in time for my tastes). I did the roll for a .05 ($5)/contract debit.
Shortly thereafter, I sold a call side against -- the 48/51.50 short call vert short here -- for a .23 ($23)/contract credit, so I'm net credit for the roll. (I could not get enough credit out of the 48.5/52 to bother with, so dropped the spread down a half strike. The resulting setup is pictured here.
Ideally, I need price to move back toward the "body" of the setup to get out for scratch or better. If that doesn't happen, I'll naturally take the call side off at near worthless, and then "lather, rinse, repeat" with the rolling/selling an oppositional side against.
Shortly thereafter, I sold a call side against -- the 48/51.50 short call vert short here -- for a .23 ($23)/contract credit, so I'm net credit for the roll. (I could not get enough credit out of the 48.5/52 to bother with, so dropped the spread down a half strike. The resulting setup is pictured here.
Ideally, I need price to move back toward the "body" of the setup to get out for scratch or better. If that doesn't happen, I'll naturally take the call side off at near worthless, and then "lather, rinse, repeat" with the rolling/selling an oppositional side against.
Comment:
Setup is now at scratch. Gamma risk increases running into expiry with ATM options, so I'll try to pull it off here, even though it's possible it could pin to this 48 area and result in a fairly "perfect finish." The short call is "no bid," so I'll have to close out just three of the four legs and leave the short call to expire worthless.
Trade closed manually:
Covering the 45P/48.5P/48C for a 1.66 db here. The long call is "no bid," so I'll just let it expire worthless. This will be a "perfect scratch," which beats a "perfect loser."