Trade view /
14 June 2016 at 8:20 GMT
Markets have sold off mildly since we initated our volatility (vega) positive, neutral strategy and the QQQs are trading $108.03. As a reminder, to make the most of this trade we need the Q's to trade near our short strike price of 111 by expiration.
For the first roll we will not make any adjustment to the strike price. Roll out of June 16 111 call into 23 June 16 111 call ( Buy to close June 16/Sell to open 23 June 16 111 call). As of last night, June 16 111 call could be bought at $0.03 while the 23 June 16 111 call could be sold for $0.24. The result will produce a net credit of $0.21 which reduces our initial investment of $0.83 down to $0.62.
We have four weekly expiration to work with until July 16 expiration which gives us plenty of opportunity to not only reduce the cost basis of the calendar but also the market posture on it (from neutral to directional).
— Edited by Clare MacCarthy
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