Live: Tuesday, Oct. 16, 2018

11:50 a.m. New York time

I have entered a short iron fly options spread on IBM.

10:45 a.m. New York time

In the earnings season, the techs are starting to publish. I’m most interested in analyzing IBM for trading today.

Another tech, NFLX, is also on the calendar, but at $335 or so per share, it lacks granularity in sizing the trade, so I’m passing on it. The other prospective earnings plays on the calendar are ABT, CREE, CSX, UAL and MTG.

Today’s Book

Volatility: Practical Options Theory by Adam S. Iqbal

If there is a theme that dominates my trading, surely it is volatility. Indeed,, blindfold me so I can’t look at a single chart or read a single quarterly report. Plug up my ears so that I can’t hear a single market commentary. Only let me know the volatility implied by the options on a stock, and how that volatility relates to its history over the past year, and I can tell you in an instant whether I want to look at it more closely at a possible trade.

The author of Volatility, Adam S. Iqbal, is a managing director and global head of FX exotics and correlation at Goldman Sachs. His book takes a deep dive into options theory, the assumptions that underly it, and ways to apply theory in the real world. I place great value on intuition in trading, and one of Iqbal’s goals for this book is to discuss ways of developing a more accurate intuition in making decisions when the clock is ticking.

In my world of options trading, volatility is pretty much the game. Volatility the book provides the strategic foundation for winning at that game.

More about the book

The status of my options positions.

sym option debit share price curr % max profit net prft/shr $ option days left
C 2.98 69.54 13.6 0.47 31
EWZ 1.01 39.15 (17.4) (0.15) 31
JNJ 5.40 136.89 3.6 0.20 31
LEN 3.43 44.15 (6.2) (0.20) 31
SPY 3.72 277.32 14.7 0.64 31
STZ 10.63 226.04 (26.5) (2.23) 31
WBA 3.48 74.95 2.2 0.08 31
sym share price net result % net profit $ days held
AAPL 217.62 -2.8% (6.34) 32
CHK 4.80 20.0% 0.80 32
FXI 39.92 -3.1% (1.29) 32
SPXU 36.77 -9.3% (3.79) 154
TSLA 268.98 -11.8% (36.01) 15
VNQI 53.55 -5.7% (3.26) 33

By Tim Bovee, Portland, Oregon, Oct. 16, 2018

Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decisions for his or her own account, and take responsibility for the consequences.


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