An update on the Russia Bear 3x ETF RUSS

I have actively traded $RUSS since Friday. Here is the current trade that I have on:

  • June/Jan 56/40 Bear Risk Reversal (this was initially a Collar as I was Long the ETF)
  • This trade takes margin due to the Short Calls (expensive)

So far the fade in $RUSS has taken the Long Puts portion of the trade ITM (in the money) so I am getting what I want in the trade. I have a Buy Stop set at $50 (this would be a hedge for the Short Calls).

 

-DM 11 AM CST

 

A short-term Trade Idea in FedEx

$FDX had Earnings this morning and so far it has taken it on the chin. It is currently trading around the $166 level so I’ve been looking at a few different ideas for a short-term trade (this week):

1) December 165/167.5/165 Risk Reversal Call Spread for a small credit

2) Short the December 167.5/162.5 Strangle for a $2.50 credit

3) Short the December $165 Puts for a $1.60 credit

 

Carmax revving up into Earnings

One of the strategies for Option traders it to own lower IV Options and sell into an event that cause the IV to rise greatly (like Earnings). Sometimes it is ok to close an Option trade right before the event (take the $ and run so to speak).

As an example I have done just that with $KMX. Here was my initial trade:

  • December 57.5/62.5/55 Risk Reversal Call Spread
  • This means I was Long the 57.5/62.5 Call Spread and Short the $55 Puts
  • I had done this trade on 12/03 for an $.18 credit (takes margin)

Today I exited the Long $57.5 Calls thus leaving me with 2 Short Option pieces: the December 62.5/55 Strangle. As long as price stays within this range I will keep all the premium collected to this point: $3.28

If price gets above $60.78 then the exit was premature. If not, genius. LOL

 

Trading Activity

Activity for today in the Swing account and the Submarine Basket:

$KMX  With the IV continuing to elevate I elected to StC the December $57.5 Calls. This leaves a Short 62.5/55 Strangle for Earnings. Options Net improves to: $3.28

$MCD  I unwound the December 92.5/91 Put Spread. The short stock piece hit the Stop today. This leaves me with Short December $91 Puts (remainder of the Put Ratio). Options Net now: $1.54 & stock gains remain $2.97

$RUSS  I adjusted the Diagonal Collar to the 56/40 strikes. The Long ETF piece hit a Stop at $56 today so the Diagonal Collar became a Bear Risk Reversal. I set a Buy Stop at $43.50 (it did hit already) so back to a Diagonal Collar

$UVXY  I adjusted the Short December $27 Calls to a December 26w 30/24 Strangle (leaving the Short December $23 Puts as well for now). Options Net improves to: $4.70 & the gains on the Long ETF portion sit at $9.904

$DXJ  The Stop hit on the Long December $55 Calls. This leaves a Short January 58/51 Strangle. Options Net: $1.64

$AGCO  I added a Long January 45/40 Put Spread (protect Long stock) and Short December $45 Puts. Options Net now: -$.17

$F  I BtC December 26w $15.5 Calls (Submarine Basket) so this position is now closed

 

Trading Activity

$RUSS  Russia continued to get mauled. I took the opportunity to exit the Long ETF piece (overall gain of $9.545). I then did a new trade: Long the ETF at $42.17 with a June/Jan 2015 39/36 Collar for a $10.45 credit (Call Options are ITM)

$UVXY  I held a Long piece over the weekend – as a hedge on the Short December 27/23 Strangle – and exited the Long ETF piece in P/M. I once again set a Buy Stop – this time at $26.50 (this has since hit). I have a Stop set at $26.75 on this current Long ETF piece

$EA  I added a January 45/40 Put Spread (long-term account, creates a Mar/Jan Diagonal Collar PS now, protects stock down to $40)

$AGCO  A lot of Call buying for the December $45 Calls so I tagged along with stock on the break at $43 (Submarine Basket)

$TEN  BtC the December $55 Calls for .25 debit. This position is now closed (Submarine Basket)

$TSCO  BtO Jan $75 Puts for 1.30 debit (protect long stock, creates a Diagonal Collar, Submarine Basket)

 

-DM 10:30 AM CST

December Monthly Options expiration – the plan

Swing Account:

$KMX  57.5/62.5/55 Risk Reversal CS (has Earnings on 12/09)

$MCD  Long 92.5/91 1×2 Put Ratio

$UVXY  Short 27/23 Strangle (own the ETF at $28)

Long-Term account:

$AVGO  92.5/97.5/100/105 Split Call Fly

IRA:

$CYBR  40/45/50 Call Fly

$INTC  Short $33 Calls (covered calls)

$MAR  Short $80 Calls (part of a Long January Call Calendar)

Submarine Basket:

$SKX  Short $60 Calls (covered calls)

$TEN  Short $55 Calls

$TSCO  Short $75 Calls (covered calls)

Earnings:

$GIII  85/90/80 Risk Reversal Call Spread

$AZO  Long 580/590 1×2 Call Ratio and Long stock at $596

$KKD  20/19 1×2 Put Ratio and Short stock at $19 (hedge)

$RH  90/95 Call Spread

Fab 5:

$BMRN  Short $90 Calls (covered calls)

$HD  Short $95 Calls (part of a Long Jan/Dec 90/95 Diagonal Call Calendar)

$XRT  Short $93 Calls (covered calls)

 

Trading Activity

Friday activity:

Veeva Systems $VEEV  Unwound the Short Strangle. Options Net final: $1.23 and stock gains of $.40 (Earnings trade)

ProShares Ultra Short VIX Short-Term Futures $UVXY  I am Long once again ($28.55). The Short December 25/19 Strangle remains (I will adjust the Calls up/out today)

PNC Financial $PNC  I have BtC the December $90 Calls and added a new trade: Long January 90/92.5/95 Call Fly. Options Net shrinks to: $.41 (I sold the long stock piece yesterday) so now stock involved

Lear Corp $LEA  I have BtC the December 95 Calls. Options Net final: $.22 and stock gains of $15.00 (Submarine Basket)