Paul, it sounds like you've thrown a Hail Mary and missed the backboard.
I suggest you reassess the position in terms of your profit objective and risk tolerance.
This position has repeatedly lost more than 10%. I'd suggest you never hold a position on the wrong side of the market and allow a single position to lose more than 10% ... I use 7% as enough of a "flag" that the trade is not going as I planned. I had many 7% losers as the market reversed mid-January. I could have "doubled down" and played out theta into January expiration or rolled into Feb or March. Any such battle would have been fearsome and bloody. I was happy to have a cash balance and have free working capital to pursue low risk, high probability trades rather than battle out bullish positions in a market turning sideways or bearish. I look at reversals in terms of momentum -- as the market loses momentum, my trades become shorter time frames and less aggressive. After nine months of winning trades, I have no qualms about scaling down to small size trades with short term (swing or intraday) trades.
The short 1150 march call on the SPX position could go further in the money before March expiry. Regardless of volatility, time or extrinsic value, a single cash secured position like this could well run an account towards zero and the broker will intervene and close the position on your behalf to prevent the account going negative.
Perhaps you sold for approximately where it's trading today. I'd suggest no more than a 7% loss from the mark today without hoping or waiting.
I'd suggest you paper trade these high risk speculative trades.
On Thu, Feb 11, 2010 at 6:56 AM, Meuter Gisbert <gismeu@gmail.com > wrote:
but by doing that you increase risk of more loss too. You should mention that!!!
gisOn Tue, Feb 9, 2010 at 10:54 PM, Sean <mrwash1967@yahoo.com > wrote:
You can roll it out a month or more and down in strike. I would try to take in some more credit too.
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--- In OptionClub@yahoogroups.com , "paul7313" <paul7313@...> wrote:
>
> some time back, I sold a put spx 1150 strike march. the market fell to now and I want to buy it back so it doesn't get exercised. any advice will be greatly appreciated.
>
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