Friday, August 26, 2016

Weekly: Four election trades

I'm looking for volatility to pick up so plan to trade cautiously, with big reserve. This week I initiated, four election ratio spread trades. These back ratios target a 5% up move in IWM, or 10% down move in SPY, and a 10% up move in GLD, 7% up in TLT. These are pilot positions, so I am add, subtract, perhaps even reverse as time goes on. For easy tracking: IWM ~ 123, SPY ~ 217, GLD ~126, TLT ~138.
Here are the trades (c = calls, p = puts, all are third week expiration unless noted, sell means sell-to-open, cover means buy-to-close, number is price per contract):

Wed Sell VRX Sep 26 p 18 rebalance as Valeant rallies
Sell WYNN Sep 75 p 21

Election trades. I am targeting a 5% up move in IWM, or 10% downside in SPY. Also a 10% up move in GLD. Initial outlay is small for IWM, GLD. I get a small credit for SPY.

IWM ratio: Buy IWM Nov 125 c 289
Sell 2x IWM Nov 130 c 98 each

SPY ratio: Buy SPY Nov 205 p 249
Sell 2x SPY Nov 195 p 135.5 each

GLD ratio: Buy GLD Dec 135 c 209
Sell 2x GLD Dec 145 c 82 each

Sell BRKB Sep 152.5 c 36
Sell GDX Oct 22 p 24

Thu TLT ratio: Buy TLT Nov 145 c 122
Sell 2x TLT Nov 150 c 50 each

Fri Roll BRKB: Cover BRKB AugW4 147 c 43 (40% profit)
Sell BRKB Sep 148 c 143
Sell ADSK Oct 57.5 p 29


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