No, I did not sell calls on corn, soy, or wheat.

We are in a weather market, and at this time of the year you can loose a lot of money when selling options. Currently I avoid selling options on these commodities, as it is hard to predict the weather. The reason for the recent retracements was a cooler and wetter weather forecast last weekend. But it could have been hotter and drier as well - who knows in advance ? And in this case, especially soybean prices would have been exploding.

The problem for option sellers: If you win you win a small amount. If you loose you loose a lot. Thus, you have to make a high percentage of winners. But trading during weather markets is like flipping a coin.

There might be interesting opportunities for call sellers when the crops are more or less made. Volatility often is still quite high, but risk of an unforeseen large price move is lower.

Best regards, Myrrdin

I almost got burned selling corn puts per a bullish recommendation from Hightower. Fundamentally it may be the right direction due to the hot and dry weather affecting pollination and potentially lowering yields; but the ups and downs are a bit too pronounced for my taste. Managed to get out unscathed; but I'll be more careful this time of year with grains.

What about meats? What are your thoughts on selling puts on hogs?

I almost got burned selling corn puts per a bullish recommendation from Hightower. Fundamentally it may be the right direction due to the hot and dry weather affecting pollination and potentially lowering yields; but the ups and downs are a bit too pronounced for my taste. Managed to get out unscathed; but I'll be more careful this time of year with grains.

What about meats? What are your thoughts on selling puts on hogs?

Currently I hold the following positions in the short options portfolio?
LCV P100+P106 / C136
In my opinion, the highs are in, and LC prices will move more or less sidewards. But there will be strong moves upwards and downwards.

CLZ C58-68
Intend to take profit at 50 %, if given the chance soon.

Currently I do not hold ES puts, as there are so many other promising trades around. Among others, I hold spread positions in the Financials, RB-HO, KW-W, LHG-LHV, LHG-LHZ and covered outright long positions in CC and KC.

Best regards, Myrrdin

A couple ?'s
LCV p100+p106/c136
Did you sell a p100 and a p106 for each c136?

I am not experienced enough understand spreads very well. Examples RB-HO is the trade based on some seasonality in the markets? Then the LHG-LHZ is that based on the difference in price between the months?

Don't mean to ask too many ?'s as I have been reading a couple of the books you recommended. Just slow at reading and maybe haven't gotten that far.

Here is an interesting seasonal trade.

LHq last trading day is the 10th trading day of the month. LHv, LHz & LHg usually go up on the 8th through the 10th trading days of the month.



It didn't work in 2014 but that year was abnormally high prices. It didn't work in 2007 and I have no idea why.

It has averaged +1.100 per year the last 6 years not including 2014.

For 2017 this would mean selling late on Wed Aug 9th and buying back Monday Aug 14th.

Even if you are not trading this with futures you could use it to time selling options.

Of course, past performance does not guarantee future results.