$IWM December Put Butterfly Update: We had a nice gap lower in the Russell 2000 this morning and that put price right in the middle of the expiration break even points for the December position. In the video below I take a look at an adjustment that cuts the downside risk and closes out part […]
What it’s about: The video below goes through a naked put trade in $GLD and then moves to the $IWM butterfly. The December IWM Put Butterfly is within two weeks of expiration and the Gamma, Delta combination is getting a little risky for my taste. I take a look at two expiration week adjustments that […]
Video update: We’re about two weeks from the December expiration and $IWM is up above 117 again, which is creating a potential problem for the December Options Butterfly. In the video below I go through two potential Butterfly Adjustments for the December position. Specifically, I consider a long call and rolling up some of the […]
When we begin trading Vertical spreads, Iron Condors, and Butterflies we learn that the trades are short vega. In other words, they benefit from a decrease in implied volatility. The opposite also generally holds true, meaning an increase in implied volatility should hurt the positions. However, complex options positions are made up of individual options […]
The 10 Second Overview: The video below goes through the open $IWM Options Put Butterfly positions for the December 2014 and January 2015 expiration cycles. The December expiration has been very challenging for neutral options trading, but the recent sell-off left the position in great shape. The January position looks very good for only being […]
Overview: The Russell 2000 continued to push higher yesterday and today and that triggered yet another upside adjustment for the Put Butterfly. Today I added a 112/117/121 Put Butterfly for a .85 debit. I was hoping to see IWM back off a little bit this week and that might still happen, but today it made […]