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Diversified Option Selling Portfolio
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Diversified Option Selling Portfolio

  #1271 (permalink)
Market Wizard
Linz Austria
 
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myrrdin View Post
I sold the WZ C600 some time ago, but bought it back with a small loss.

Later I sold the WZ C650, and with this option I feel comfortable.

I rarely buy options.

Best regards, Myrrdin

USDA report of today was bearish wheat, as US and global wheat stocks were adjusted higher. The only argument for rising prices is that the report was bullish for corn.

USDA report for me confirms staying in the trade short WZ C650.

Best regards, Myrrdin

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  #1272 (permalink)
World'sWorstTrader
Knoxville Tennessee USA
 
Futures Experience: Intermediate
Platform: TOS
Favorite Futures: ES, NQ, CL, /6E futures options.
 
Posts: 297 since Oct 2012
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?

Has the unbalanced butterfly been a successful spread with the type of options sold by this group?

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  #1273 (permalink)
Trading for Fun
Salt Lake City, USA
 
Futures Experience: Intermediate
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Wheat


Myrrdin,

Did you close out your wheat call yet given this downward move ?

thanks

VJ

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  #1274 (permalink)
Market Wizard
Linz Austria
 
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vmaiya73 View Post
Myrrdin,

Did you close out your wheat call yet given this downward move ?

thanks

VJ

Yes, I liquidated this position today before the close. Profit was a bit more than 50 %, but the option does not expire before December.

I still hold a small MWZ outright short position.

Best regards, Myrrdin

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  #1275 (permalink)
Elite Member
Singapore
 
Futures Experience: Beginner
Platform: TDAmeritrade
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Hi folks,

Any idea why LEM8 dropped so much these 3 weeks? I have short P100 position, small size though.
Thank you for your input.

Best Regards
David

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  #1276 (permalink)
Market Wizard
Linz Austria
 
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sinpeople View Post
Hi folks,

Any idea why LEM8 dropped so much these 3 weeks? I have short P100 position, small size though.
Thank you for your input.

Best Regards
David

The reason is mainly Supply & Demand. And perhaps fear that the Chinese will reduce their imports. But these imports are significantly smaller than their hog imports.

We might move further downwards on Monday, as the Cattle on Feed Report, published Friday after the close, was bearish the June and August contracts.

In the long run, LCM should move back upwards.

I just sold the LCQ P96. I also hold the LCV-LCM for some time, which is highly profitable and serves as a hedge for the short puts.

Best regards, Myrrdin


Last edited by myrrdin; March 24th, 2018 at 04:12 AM.
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  #1277 (permalink)
Market Wizard
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myrrdin View Post
The reason is mainly Supply & Demand.

An additional remark: I do not think it is a good idea to hold short option positions, when an important report is published, if you are not an expert in this field. I liquidated my short LCJ C124 some days before the CoF Report to reduce risk.

Best regards, Myrrdin

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  #1278 (permalink)
Elite Member
Singapore
 
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Thank you for your input. Anyway, what time frame is it roughly for LCM to move back upwards in long run, in weeks or months? LCM expires in June with OLCM8 options expiring on the 1st day of that month. There is no more trading day in March. It is almost exactly 2 months for OLCM8 to expire.

Yesterday (Thursday), LCM had a drop of $3 which pushes LCM8 to 102.575 just before the end of trading session. Will it move further down to be below 100 in April? Just curious. My OLCM8 P100 position hasn't hit the risk control parameter yet. But I have already start to wonder should I set up a stop order standing there to wait it to happen.

Thanks again for sharing your knowledge.


Best Regards
David



myrrdin View Post
The reason is mainly Supply & Demand. And perhaps fear that the Chinese will reduce their imports. But these imports are significantly smaller than their hog imports.

We might move further downwards on Monday, as the Cattle on Feed Report, published Friday after the close, was bearish the June and August contracts.

In the long run, LCM should move back upwards.

I just sold the LCQ P96. I also hold the LCV-LCM for some time, which is highly profitable and serves as a hedge for the short puts.

Best regards, Myrrdin


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  #1279 (permalink)
Market Wizard
Linz Austria
 
Futures Experience: Advanced
Platform: Zaner360, TWS, Vantage
Broker/Data: DeCarley, IAB, RJO
Favorite Futures: Commodities
 
Posts: 1,308 since Nov 2014
Thanks: 1,609 given, 1,576 received
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sinpeople View Post
Thank you for your input. Anyway, what time frame is it roughly for LCM to move back upwards in long run, in weeks or months? LCM expires in June with OLCM8 options expiring on the 1st day of that month. There is no more trading day in March. It is almost exactly 2 months for OLCM8 to expire.

Yesterday (Thursday), LCM had a drop of $3 which pushes LCM8 to 102.575 just before the end of trading session. Will it move further down to be below 100 in April? Just curious. My OLCM8 P100 position hasn't hit the risk control parameter yet. But I have already start to wonder should I set up a stop order standing there to wait it to happen.

Thanks again for sharing your knowledge.


Best Regards
David

Hard to say when LCM will move upwards again. Cash price is coming down since middle of March, and it has to come down far enough to stimulate consumption.

This is why I hold the LCQ puts. These options move slower as the LCM puts. Furthermore, in my opinion the August contract is undervalued to a higher degree than the June contract. In addition I hold the LCV - LCM future spread as a hedge for the options.

I would consider to roll the LCM puts to the August contract.

I never use a stop order for options. The fill most often is terrible. I usually exit end of day. Watch the volume of futures in the meat markets: Most volume is traded during a few minutes before the close.

Best regards, Myrrdin

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  #1280 (permalink)
Trading for Fun
Salt Lake City, USA
 
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Soybeans ?


Afternoon Myrrdin,

wonder what your thoughts on selling calls in SOYBEANS ? Looks like the report that came out on thursday caused a large spike on soybeans, however looks like the US market will be posting the largest ever production/harvest.

thanks

VJ

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