Re: [TheOptionClub.com] XLE Aug-Sep Gorilla Calendar

 

Thanks again, Mark. I don't plan on being in this trade for more than a few weeks unless something awful happens to XLE. I would like to see the price approach the break even on the upside so I can add another calendar. Then for the price to back off into the enlarged sweet spot and let theta take over.

RFH

--- In OptionClub@yahoogroups.com, "Mark Sebastian" <mark@...> wrote:
>
> Whoever taught you to have a negative skew has probably not reevaluted
> dealing with calendars under current market conditions
> g problem
>
>
>
> Generally, I would say a negative skew is going to be a big problem,
> defiantly over several months
>
>
>
> From: OptionClub@yahoogroups.com [mailto:OptionClub@yahoogroups.com] On
> Behalf Of RobertH
> Sent: Friday, July 30, 2010 1:14 AM
> To: OptionClub@yahoogroups.com
> Subject: Re: [TheOptionClub.com] XLE Aug-Sep Gorilla Calendar
>
>
>
>
>
> Thanks Mark. When I put the trade on, the IV of the short was 24.9% and the
> IV of the long was 25.9%. From what I have learned, you want that volatility
> skew to be between -2 and +2 unless you are specifically playing the vols
> due to an upcoming catalyst.
>
> RFH
>
> --- In OptionClub@yahoogroups.com <mailto:OptionClub%40yahoogroups.com> ,
> "Mark Sebastian" <mark@> wrote:
> >
> > I know I have said this before but, one of the most common misconceptions
> > about calendars is how they react to changes in IV, and when the best time
> > to enter them is. I will be interested to see how the XLE calendar goes as
> > well, my hope, it's a home run. That said, with Aug vol trading at almost
> > 2% below Sep, I am not in love with the conditions in which you placed
> this
> > time spread.
> >
> >
> >
> > -Mark
> >
> >
> >
> > From: OptionClub@yahoogroups.com <mailto:OptionClub%40yahoogroups.com>
> [mailto:OptionClub@yahoogroups.com <mailto:OptionClub%40yahoogroups.com> ]
> On
> > Behalf Of William Fletcher
> > Sent: Thursday, July 29, 2010 9:09 AM
> > To: optionclub@yahoogroups.com <mailto:optionclub%40yahoogroups.com>
> > Subject: RE: [TheOptionClub.com] XLE Aug-Sep Gorilla Calendar
> >
> >
> >
> >
> >
> > It is of interest to me. I put an XLE calendar on on 7/13. My high
> > breakeven is $55 and it is at $54.31. I have a couple of others like that
> -
> > DIA and OEX - close to or at resistance and waiting for a pullback. My
> > guess is you entered at a better iV, but you are entering about at the end
> > of what I consider my entry window. It will be interesting to see.
> >
> >
> >
> > The beige book is due out today, which may back off the price a bit and
> > raise the iV on my positions to help me out a bit.
> >
> >
> >
> > Keep me posted.
> >
> >
> >
> > Bill
> >
> > _____
> >
> > To: OptionClub@yahoogroups.com <mailto:OptionClub%40yahoogroups.com>
> > From: robhansen5252@
> > Date: Thu, 29 Jul 2010 04:57:22 +0000
> > Subject: [TheOptionClub.com] XLE Aug-Sep Gorilla Calendar
> >
> >
> >
> > Hi. I opened up a "gorrilla calendar" time spread in XLE on Tuesday. I
> know
> > that on occasion, this forum has tracked various options strategies,
> trades
> > and adjustments both theoretically as paper trades and in real time. If
> > there is any interest, I'd be happy to report the particulars of the
> trade,
> > profit goals, adjustments, etc. as they occur. Of course if there are any
> > differing opinions as to how to handle the inevitable scenarios between
> now
> > and August expiration, they can be debated. Could this possibly be a
> > learning experience?
> >
> > RFH
> >
> >
> >
> >
> >
> > _____
> >
> > Hotmail is redefining busy with tools for the New Busy. Get more from your
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> >
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> > WL:en-US:WM_HMP:042010_2>
> >
>

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