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Replies to post #2696 on °¿°

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AnderL

10/03/08 9:59 AM

#2782 RE: AnderL #2696

XLF Straddle (paper)

Okay so I'm seeing what is going on here. I needed more volatility or when the put rallied to $2.50 I should have sold it for the profit and held the call and run the risk of it going worthless or bouncing back and recovering some of the capital. Still at $2.50 I would have had around a $1600 profit so a worthless call would have put me at -$700 on the trade. Elevated risk and speculation doing that.

I guess I could have sold the put and taken the profits and rolled into a higher out of the money put at 21.00 but now I'm spread wider. That is not good. Thinking out loud.

current position
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10Oct20c @1.36 XLFJT $1360
10Oct20p @1.70 XLFVT $1700
total value $3060

original position
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buy 10Oct20c @2.30 XLFJT $2300 + 17.49com
buy 10Oct20p @ .90 XLFVT $ 900 + 17.49com
total cost $3234.98