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
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
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
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
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.
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
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.
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
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
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
In economic reporting, it will be a week of bread-and-butter basics: Industry, retail and the cost of buying the products of those systems. It will also be a short week for traders.
The industrial production report will be published Friday at 9:15 a.m. New York time, and the retail sales on Thursday at 8:30 a.m. The consumer price index will be reported on Wednesday at 8:30 a.m.
Today’s Book
The tech giants of the Silicon Valley are the bread and butter of trading today. Yet they were once startups, the risky private companies backed by risk-taking private funds hoping to make it big. And so the cycle goes. A few of today’s risky startups will be tomorrows tech giants, the bread and butter of future trading, but most will stumble and fall aside on the complex path from a small beginning to outsized success.
John Carreyrou, an investigative reporter with The Wall Street Journal, takes us inside one of the most spectacular stumbles in recent years of a Silicon Valley startup. Theranos Inc. was started in Palo Alto, California with the goal of revolutionizing that most mundane of medical experiences, the blood test.
The company was valued in 2013 at more than $10 billion, and its CEO, Elizabeth Holmes, was talked about as the new Steve Jobs, but after Carreyrou, writing in The Wall Street Journal, questioned the technology, the company under pressure from medical authorities and the federal regulators quickly fell into decline and was close to bankruptcy.
In this book Carreyrou reveals the hard truths behind the dreams. Bad Blood is currently ranked #28 in Business & Money books, and #19 in that section for Kindle eBooks.
Fed Gov. Lael Brainard takes to the podium on Tuesday at 10 a.m. to discuss artificial intelligence and finance at a conference held by the Federal Reserve Bank in Philadelphia.
Fed Vice Chairman for Supervision Randal Quarles will testify before Congress about financial regulation. He’ll talk to the House Financial Services Committeeon Wednesday and the Senate Banking Committee on Thursday, each day at 10 a.m. The twin appearances are semiannual events.
I have entered a short iron fly spread on HD, using options that trade for the last time 42 days hence, on Dec. 21. The premium is a $9.26 credit per contract/share and the stock at the time of entry was priced at $185.72 per share.
I entered the trade to coincide with an earnings announcement on Tuesday, Nov. 13, before the opening bell.
The profit zone for this position is between $194.26 on the upside and $179.26 on the downside.
Tim Bovee, Private Trader 
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