While I wait for my "gaggle" of long VIX/VIX derivative setups to play out, I'm going to play a few of these smaller earnings announcements, so that I can keep powder dry for the juicier underlyings (should their implied volatility ever ramp up to my standards).
Metrics:
Probability of Profit: 77%
Max Profit: $79/contract
Buying Power Effect/Underfined:...
I'm adding on a touch of long delta here so that my core SPY position doesn't stray too far to the negative side. The first thing I looked at, however, was whether I could peel off some short call spread action to balance instead, but most of the spreads have not yet decayed enough to make that worthwhile ... .
Filled for $41/contract ... .
Next week brings in a bevvy of earnings plays, but not all are worth of a premium selling, implied volatility contraction play.
These are the best among the offerings currently to play either via short strangle or iron condor, although others could naturally come to the forefront if implied volatility increases dramatically immediately before earnings.
NFLX:...
With the short put nearing worthless here, I'm closing it out for a .05 debit ($5). I received a .68 credit for the 54 short put ($68), so I realized a profit of .68 - .05 = .63 ($63)/contract on that side.
Unfortunately, price is getting uncomfortably close to my short call side ... .
Another thing I'm going to do while waiting for volatility to return in the broader markets such that it makes sense to set up plays 45 days out is go short duration. While I'm not going to put this particular trade on because I have a short duration RUT/IUX iron condor that I rolled out to next week standing in as this week's short duration play (see Post...
