... for a 172.42 debit.
Comments: While I'm waiting for a July contract to open up in broad market instruments (IWM, QQQ, SPY), shopping around the ETF space for premium. Relative to broad market, SMH IV isn't horrible (the 30-day is currently at 29.3%). Selling the -75 delta call against long stock, to emulate a 25 delta short put and to take advantage of call IV skew (32.9% on the call side; 27.2% on the put).
3.58 max on BPE of 172.42; 2.08% at max; 1.04% at 50% max.
Will generally look to take profit at 50% max; roll out the short call to reduce cost basis further if it doesn't get there.
Comments: While I'm waiting for a July contract to open up in broad market instruments (IWM, QQQ, SPY), shopping around the ETF space for premium. Relative to broad market, SMH IV isn't horrible (the 30-day is currently at 29.3%). Selling the -75 delta call against long stock, to emulate a 25 delta short put and to take advantage of call IV skew (32.9% on the call side; 27.2% on the put).
3.58 max on BPE of 172.42; 2.08% at max; 1.04% at 50% max.
Will generally look to take profit at 50% max; roll out the short call to reduce cost basis further if it doesn't get there.
Note
With the absurd strength in the semiconductor sector, letting this run past 50% max ... .Trade closed manually
Out today for a 174.84 credit; 2.42 ($242) profit.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.