The Week Ahead: EWZ, MJ, XLE, IWM/RUT Premium Selling
Highly Options Liquid Single Name With Earnings in the Rear View Mirror Ranked by 30-Day Implied With a 30-Day >50% and a Share Price >$10:
FCEL (0/104)
M (11/75)
CCL (0/59)
PLAY (0/59)
CHWY (0/52)
Highly Options Liquid Exchange-Traded Funds Ranked by 30-Day Implied With a 30-Day >35%:
EWZ (8/73)
MJ (2/51)
XLE (0/48)
XRT (2/41)
GDXJ (6/41)
LIT (18/38)
XBI (36/36)
Broad Market Exchange-Traded Funds Ranked by 30-Day:
IWM (1/27)
QQQ (0/23)
SPY (0/16)
Musings:
If it isn't obvious, the number of exchange-traded funds with a 30-day implied volatilty percentage >35% have dwindled dramatically over the past several weeks, limiting premium selling opportunities if you're not interested in playing single name. That being said, it's not a bad time to relax a little bit, allow plays you've put on in higher volatility to play out, and wait for "the next one," whether it be in the market as a whole, or in a given sector. Since I've already got plays on in EWZ and MJ (See Posts Below), I may consider something in XLE, with the caveat being that its implied is low in the 52 week range, with the monster volatility pop we had in 2020 still holding sway over where current levels are relative to where they've been.
All that having been said, I'm in the mode of generating "cash flow" regardless of the volatility environment, and so will likely continue to programmatically sell my weekly, 45 days 'til expiry short put in the broad market exchange-traded fund having the highest implied volatility, which here is IWM, along with adjusting any rungs of my longer-dated SPY short put ladder to window dress, take profit, or add units to generate credit and keep that theta pile on and burning. I'd naturally prefer higher volatility to muck about in, but can't have everything.
FCEL (0/104)
M (11/75)
CCL (0/59)
PLAY (0/59)
CHWY (0/52)
Highly Options Liquid Exchange-Traded Funds Ranked by 30-Day Implied With a 30-Day >35%:
EWZ (8/73)
MJ (2/51)
XLE (0/48)
XRT (2/41)
GDXJ (6/41)
LIT (18/38)
XBI (36/36)
Broad Market Exchange-Traded Funds Ranked by 30-Day:
IWM (1/27)
QQQ (0/23)
SPY (0/16)
Musings:
If it isn't obvious, the number of exchange-traded funds with a 30-day implied volatilty percentage >35% have dwindled dramatically over the past several weeks, limiting premium selling opportunities if you're not interested in playing single name. That being said, it's not a bad time to relax a little bit, allow plays you've put on in higher volatility to play out, and wait for "the next one," whether it be in the market as a whole, or in a given sector. Since I've already got plays on in EWZ and MJ (See Posts Below), I may consider something in XLE, with the caveat being that its implied is low in the 52 week range, with the monster volatility pop we had in 2020 still holding sway over where current levels are relative to where they've been.
All that having been said, I'm in the mode of generating "cash flow" regardless of the volatility environment, and so will likely continue to programmatically sell my weekly, 45 days 'til expiry short put in the broad market exchange-traded fund having the highest implied volatility, which here is IWM, along with adjusting any rungs of my longer-dated SPY short put ladder to window dress, take profit, or add units to generate credit and keep that theta pile on and burning. I'd naturally prefer higher volatility to muck about in, but can't have everything.
