After the US Federal stimulus package re-confirmed passed. Several sectors just strengthen up in place; be it crypto or US Dollar index . At anytime, the tides went South. We need to get out!
Over the last 13 years, some of the most spectacular crashes in high-yielding bonds have begun with a monthly rejection at falling channel resistance. Equally spectacular rallies have followed, yet the bear trend remains stubbornly in place. I can't help but notice that the candle formation over the last two months looks eerly similar to the one of last year, at...
... for a .70 credit.
Notes: The 30 days until expiry weekly isn't very liquid where I want to set up my tent, so going out to the February monthly (59 days until expiry) to collect about twice the monthly dividend in premium instead.
... for a .37/contract credit.
Notes: Selling the strike in the monthly that pays a credit > or = to the monthly dividend, looking to emulate monthly dividends without being in the actual stock. The weeklies, unfortunately, aren't as liquid as I would like, so will sell in the nearest monthly down to 30 days until expiry.
We are very close to hit the resistance level 89 by wave (Z) of (WXYXZ) to complete the edge of B.
It can take from couple of weeks to couple of months to hit the level. We expect the downtrend to start by summertime (May-June 2021)
Afterwards the big-big sale of “junk bonds” will undoubtedly start along with deep correction on all the markets which will last...
... for a .37/contract credit.
Notes: Parking a little bit of idle capital in HYG in the expiry nearest 30 days in the strike that pays at or greater than the monthly dividend. Fine with getting assigned, selling call against if that happens. Will otherwise run through expiry/expiring worthless.
... for a .42/contract credit.
Notes: Selling the strike nearest 30 days that pays at or slightly greater than the monthly dividend to park buying power in short duration in lieu of just letting buying power sit idle. I'm fine with taking assignment, selling call against, so will run these to expiry, particularly given the credit received.
... for a .38 credit.
Notes: Here, selling the strike nearest 30 days that pays an amount approximately equal to or greater than the monthly dividend. (See Post Below). Just looking to park what would otherwise be just idle cash in fairly short duration. I'm okay with getting assigned, but would rather just keep the premium.
... for a .36 credit.
Notes: Although implied volatility really blows chunks here (30-day at 11.9%), looking to deploy some capital in an underlying I wouldn't mind acquiring for its dividend (current yield 4.94%). Here, selling in the expiry nearest 30 days 'til expiry for a credit that's approximately equal to the monthly dividend (currently .359). This...
I think everyone can generally agree that idle cash sitting in your account doesn't earn you much. Here are a couple of methodologies to deploy that capital to emulate dividend generation without being in the stock itself.
For purposes of this exercise, I've chosen HYG, which is not only options liquid, but also has a decent dividend relative to the broader...
... for a .66/contract credit.
Notes: A starter position in "junk" at the 17 delta in the November cycle. The implied volatility here is quite low -- 15.7% for the 30-day, but I'm looking to eventually swap out my TLT position for something that pays more on a percentage basis. HYG's yield is currently 5.02% with a monthly dividend payment of .341, with the...
