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2019 Trades

xlk: 09.27.19 – 10.14.19

ETF | Technology Fund | Status: Closed

Opening Trade

09.27.19
We got a nice little pop in
today, so I'm used the opportunity to load up a new position in XLK. Things have been a little slow going the last couple weeks, so I wanted to strike while the iron is hot. I
a
in the November
for $1.52. I sort of jumped in front of a train when I sold this, meaning I took a risk and sold it when the market was bleeding fastest. Doing so allowed me to collect a pretty large credit, and by the end of the day, KRE had already rallied back $0.47. Due to the small bounce, volatility contracted, and left me with a nice little head start on this position.
If volatility continues to expand next week, this position could take some heat. I collected a nice juicy credit, and sold fairly wide
however, which should help to absorb the blow. Continued IV expansion could also create trading opportunities in other products which would be nice. If volatility contracts, this position should profit nicely! It will also benefit from the passage of time, and small price changes in either direction. My profit target is about 50% of the max potential, so around $0.76, hopefully in the next 20-30 days.

Risk Profile:

(Not to scale)
Figure 1

Strategy: Short NOV 73/84 Strangle

sto 1 nov 15 73 put
sto 1 nov 15 84 call
Fill Price: $1.52 credit

Position Analysis

U/L Price: $79.22
IV: 23.2%
IVR: 27.3
Liquidity: 3/4
Position: Short NOV 73/84 Strangle
POP: 70%
Cost Basis: $1.52
Risk: Undefined
BPR: $1110
Max Profit: $1.52
Max Loss: unlimited
Target P/L: $0.76
Break Even(s): $71.48, $85.52
Extrinsic Value: $152.00
Net Delta: -1.84
Net Theta: 3.752

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2019 Trades
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