SPDR S&P Retail (XRT)

Update 4/4/2019: I exited XRT for a debit of $0.27, or 51% of maximum potential profit.

Shares declined by 1.5% (-$0.69) over 30 days, or a -18% annual rate. The options position yielded 103.7% (+$0.28) for a +1,262% annual rate.

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On March 5 I entered a short iron condor spread on XRT, using options that trade for the last time 73 days later, on May 17. The premium is a $0.55 credit and the stock at the time of entry was priced at $45.82.

The profit zone for this position is between $49.55 on the upside and $39.55 on the downside.

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4:30 p.m. New York time

No fill on DIS.

11:20 a.m. New York time

Attempting entry into an iron condor on DIS: c+135 c-125 p-105 p+95 @+1.03 premium IVR 38.

10:00 a.m. New York time

I’ve exited my short iron condor on XRT at 51% of maximum potential profit. Analysis to come.

By Tim Bovee, Portland, Oregon, April 4, 2019

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Celgene Corp (CELG)

Exit 4/3/2019: I exited CELG on May 3 at 50% of maximum potential profit, for a $0.59 debit.

Shares rose by 4.6% over eight days, or a 210% annual rate. The options position produced a 101.7% yield for a +4,640% annual rate

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I entered a short iron condor spread on CELG on March 26, using options that trade for the last time 52 days hence, on May 17. The premium is a $1.19 credit and the stock at the time of entry was priced at $89.34

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2:25 p.m. New York time

My exit order on CELG was filled, at a $0.59 debit. Full writeup to come.

10:30 a.m. New York time

I’m attempting to exit two positions today, both of them short iron condors expiring May 17.

CELG, c+105 c-97.5 p-75 p+70, call delta 20 (82%) put delta 15 (91%), IVR 62, RR 4.3:1, entered 3/26/2019 credit $1.19. I’m attempting to exit for a $0.59 debit, which is 50% of maximum potential profit.

XRT,  c+52 c-49 p-42 p+39, call delta 18 (82%) put delta 18 (80%), IVR 37%, RR 4.5:1, entered 3/5/2019 credit $0.55. I’m attempting to exit for a $0.27 debit, which is 51% of maximum potential profit.

Layout and abbreviations: symbol, long_call short_call short_put long_put, short call delta (chance of expiring out of the money), short put delta (chance of expiring out of the money), IV Rank (IVR) at entry, risk/reward ratio (RR), date of entry, amount of credit at entry.

By Tim Bovee, Portland, Oregon, April 3, 2019

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10:50 a.m. New York time

XRT moved to 45.5% of maximum potential profit ($0.30 debit to exit the iron condor). Nonetheless, I have entered an exit order, at $0.27, which is 51% of max.

I said yesterday that I would be looking at EA today. It’s not a bad trade, but the reduction in my account’s buying power is greater than I like, so I shall pass for now.

Here’s the analysis:

EA has an implied volatility rank of 48%, with shares at $101.89.

Premium:	$1.32	Expire OTM
EA-iron condor	Strike	Odds	Delta
Long	130.00	96.0%	5
Break-even	121.32	92.0%	9.5
Short	120.00	88.0%	14
Puts
Short	85.00	86.0%	11
Break-even	76.32	90.5%	7
Long	75.00	95.0%	3

The proposed position covers 13.2% of premium with a risk/reward ratio of $868/$132, or 6.6:1.

4:30 p.m. New York time

The closing bell came with no fill on my XRT exit order.

By Tim Bovee, Portland, Oregon, April 2, 2019

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One position, which was omitted from my catch-up list of live positions, hit 50% of maximum potential profit today. However, the price spread was such that I wasn’t able to get a fill at that price.

The position is an iron condor and was entered on March 5.

XRT, c+52 c-49 p-42 p+39, call delta 18 (82%) put delta 18 (80%), IVR 37%, RR 4.5:1, 3/5/2019, $0.55

The exit target price was $0.27 credit. Under my rules, I must exit by April 26.

Tomorrow I’ll be looking at entering EWZ as an iron condor.

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Here are my current positions, all of them iron condors expiring May 17. I’ll abbreviate as follows: symbol, long_call short_call short_put long_put, short call delta (chance of expiring out of the money), short put delta (chance of expiring out of the money), IV Rank (IVR), risk/reward ratio (RR), date of entry, amount of credit at entry

• CGC, c+60 c-55 p-35 p+32.5, call delta 23 (82%) put delta 17 (76%), IVR 47, RR 2.6:1, 3/19, $0.45
• GDXJ, c+39 c-36 p-30 c+27, call delta 19 (83%) put delta 5 (94%), IVR 34%, RR 3.8:1, 3/15, $0.62
• STNE, c+55 c-50 p-33 p-28, call delta 22 (84%) put delta 19 (74%), IVR 70%, RR 2.8:1, 3/20, $1.31

By Tim Bovee, Portland, Oregon, March 30, 2019

Disclaimer

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.

License

All content on Tim Bovee, Private Trader by Timothy K. Bovee is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

Based on a work at www.timbovee.com.

BMY iron condor, expires 4/18/2019

IV Rate 66%

Call spread: -60 delta 19 (85% chance of expiring out of the money) / hedge +65

Put spread -45 delta 15 (82% OTM) / hedge +40

risk/reward ratio 4.3:1

Entry $0.95 credit per contract 2/15/2019

Exit $0.44 debit per contract 3/19/2019

Result: +115.9% (+$0.51) yield over 32 days +1,322% annual rate

XLI iron condor, expires 4/18/2019

IV Rate 77%

Call spread -80 delta 21 (79% OTM) / hedge +84

Put spread -72 delta 17 (82% OTM) / hedge +69

Risk/reward ratio 4.6:1

+117.24% yield +1,945.14% annual rate (+$0.34)

Entry $0.63 credit per contract 2/25/2019

Exit $0.29 debit per contract 3/19/2019

Result +117.2% ($0.34) yield over 22 days +1,945% annual rate

By Tim Bovee, Portland, Oregon, March 30, 2019

Disclaimer

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.

License

All content on Tim Bovee, Private Trader by Timothy K. Bovee is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

Based on a work at www.timbovee.com.

 

It was a nice sabbatical, which, in true Private Trader fashion, I spent obsessively reworking my trading practices. I mean, come on. We love trading. We love the markets. How else would people like us spend their time?

My prior practice had centered on earnings announcements, using the Iron Fly strategy: A short call vertical spread and a short put vertical, each with the short leg having the same strike price. A cousin of the iron condor.

The Iron Fly made for high velocity trading, but also with a high rate of losses.

I’ve decided to move to a more conservative strategy. Part of that is age — I’m 73, retired, and so conservation of funds is increasingly important. Also, I’m looking for a more measured approach than by event-centered strategy could provide.

Coming up, my new trading rules, followed by some examples of recent trades.

By Tim Bovee, Portland, Oregon, March 30, 2019

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I’m shutting down Private Trader for awhile. The time taken for posting can be put to better use for research.

To anyone wishing information on how to trade options the way I do, I strongly recommend checking out TastyTrade, which I consider to be the best options education site on the internet.

For any wishing information on Elliott wave analysis, which I also use for some trades, I strongly recommend checking out Elliott Wave International, the best source of information for those who wish to learn this useful method of understanding charts.

Best wishes and good trading to all!

Tim

By Tim Bovee, Portland, Oregon, Nov. 12, 2018

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