Selling Swing: Creating debit spread to PROTECT the 200% pr
Posted: Wed Feb 01, 2012 2:02 pm
Selling Swing: Creating debit spread to PROTECT the 200% profits we have on the 132 calls that we entered into at .45 and are now 1.40 from yesterday by shorting same contract amount of the 133 calls at .62 . we hold the long 132 calls leg but we erase risk of a possible pullback by shorting these in the money calls. If we were to pass day highs then would exit this short leg and again allow the long leg to continue. Now with this strategy we are protected against theta and if we were to shake we could lock in the profits on the short lower once we are well placed to move up again. As far as this one has been very disappointing today still believe we should see momentum renter her but the long 465 calls are now in danger of removing some of the profits from the short puts strategy. Again on SPY if passes day highs then will take a quick loss on this short on calls wherever the premium may stand.
This trade is one part of a larger strategy so please look back at Previous posts to see the whole picture. AND IF YOU ARE NEW, PAPER TRADE FOR AT LEAST A FEW MONTHS because this is ADVANCED OPTIONS TRADING !!
This trade is one part of a larger strategy so please look back at Previous posts to see the whole picture. AND IF YOU ARE NEW, PAPER TRADE FOR AT LEAST A FEW MONTHS because this is ADVANCED OPTIONS TRADING !!