Trade Log – Week Ending Apr 11 2020

Happy Easter!

(I forgot to hit send on this post, so it’s coming out late. Oops)

This last week wasn’t a great one for my portfolio. I remain positioned very short and in this short week as the market’s had what I believe to be a very short lived rally, I took a bunch of paper losses.

No changes to the portfolio this week. I’ll hold into next week as I expect the market to begin to soften. The good news is with the VIX coming down, I may be able to at least get out of my April VXX credit spread for a scratch, or maybe a few bucks. We will see 🙂

Till then, HE IS RISEN!

Trade Log – Week Ending Apr 4 2020

As expected, volatility is starting to come in a bit and the markets are acting a bit more “normal” during this time of economic and societal uncertainty. This week we had some actual 2 sided action… markets that for all intents and purposes are looking like one would expect! Check out the chart of the /ES – it’s starting to look normal trade (just larger ranges).

ES 30 min chart

You can see the IV come back in over the past few days as well as all of the momentum indicators.

SPX Chart

This week I started to dramatically pivot my trading posture back to “normal” and have moved away from being a net purchaser of options to a net seller of them again. I still have a few debit spreads or outright buys that I will do for appropriate catalyst events – otherwise it’s back to selling premium as the market likely grinds lower for some time.

All of my portfolios are bearish in their stance with my long term accounts in almost all cash or cash equivalent investments.

I have positioned my retirement accounts; 401(k), IRA etc… into highly defensive postures. Most of this occurred before the drop began in late Feb and I adjusted a bit more aggressively during the first 2 weeks of the market declines.

As a total side note… I really dislike limited investing vehicles – especially in times of crisis… 2008-2009 was very frustrating to me as well, so much lost opportunity for profiting on both sides of the trade. My 401(k) has some really great options for bull markets, but in bear markets it’s meh.

For the speculative accounts, I am short delta and getting back to long theta positions. I do have a host of hold over “debit spreads” mainly in the SPY’s that expire in the April cycle – depending on the market movement over the next week I may sell these off for some realized losses.

I captured about 4% in realized profits for the total portfolio and remain about 25% allocated. I’ll be moving that up in a measured pace over the next couple of weeks.

Current positions:

EFA – Debit Call Spread, likely to expire worthless

OIH – Credit Put Spread 5/4 in April, this position will likely get rolled out over the next week or so. I don’t really want to get assigned OIH and would prefer to simply carry the spread forward for a small debit.

OPK – Long stock, this one is meh and I’m only holding it as I expect it’ll come back close to my purchase price at some point during this Coronavirus time. OPK is a testing firm and some news shortly should again cause them to pop. I’m in at $1.90 and it’s trading at $1.17. Normally I don’t do tiny stocks like this, but with the virus the opportunities where really good.

SPY – Lots of positions, net short. The vast majority of my positions here are for the April cycle. I have put spreads as low at 175/170 (unlikely to be profitable) and some as close as our current 245 or so. I also have a bunch of credit call spreads with the low strikes being around 263 and up.

For SPY I’ve been opening credit spreads, and then tossing a GTC buy back order at 50% profit. They are hitting in a matter of days given the amount of movement we are seeing which is pretty nice.

VXX – I’m still short vol with VXX and I’m not sure the April position is going to come in for me. I may need to roll it out if I can do so for a reasonable price. April is 37/40 on the calls and May is 40/45. We’ll need a pretty big vol crush for the April positions to pan out.

XLP – Credit Call Spread at 57/62, just a bearish spread.

XLU – Credit Call Spread at 56/61, same as above.

I got in and out of a few positions this week in /ES, GILD CCL, HTZ, WTRH, TSN and T – a mixed bag but overall profitable.

I was able to get my SPX selling going again as well, and they had a perfect week. I’m glad to get those started up. Scaling is not on contract size, but on spread width for now. I am seeing slightly better fills and less slippage using that method.