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Message
re: DOW & S&P at all time highs
Posted on 7/13/16 at 8:21 pm to Doc Fenton
Posted on 7/13/16 at 8:21 pm to Doc Fenton
Keep me posted. Watch it carefully. I mostly buy OTM, like you did here. All you need now is a declining SPX, doesn't even need to get that close to your strike for you to successfully get out at a gain, and you've set some sort of conditional hidden so you're hopefully only going to lose your 25% limit if it goes the other direction.
The only thing different with me is I usually buy further out on something like this. The time premium doesn't bother me, and there are sometimes some odd asks sitting out there. An example of that was SLV before siver had a modest run up. Some of the leap calls were priced ridiculously cheap. I was merely taking strike plus premium added together, and thinking no way does silver not have enough directional momentum both ways between when I purchased and 2018. I think I bought $18 calls for a buck something. So that's $19 SLV, or close to $19 SLV, or any upward momentum between 2016 and 2018. When I first saw that I thought I was making a mistake in my calculations, but I jumped. I did this with UNG and USO as well.
I'm toying around with buying puts on the S&P mini contract out to June 2017. 2120 is at $6350 premium right now. But I've been hesitant as I'd like to go out further, and I'm not quite sure how best to do this yet.
The only thing different with me is I usually buy further out on something like this. The time premium doesn't bother me, and there are sometimes some odd asks sitting out there. An example of that was SLV before siver had a modest run up. Some of the leap calls were priced ridiculously cheap. I was merely taking strike plus premium added together, and thinking no way does silver not have enough directional momentum both ways between when I purchased and 2018. I think I bought $18 calls for a buck something. So that's $19 SLV, or close to $19 SLV, or any upward momentum between 2016 and 2018. When I first saw that I thought I was making a mistake in my calculations, but I jumped. I did this with UNG and USO as well.
I'm toying around with buying puts on the S&P mini contract out to June 2017. 2120 is at $6350 premium right now. But I've been hesitant as I'd like to go out further, and I'm not quite sure how best to do this yet.
This post was edited on 7/13/16 at 8:43 pm
1
Posted on 7/14/16 at 1:00 am to anc
quote:
Explain this to me. Im a real novice that is eager to learn.
If I wanted to convert to VIX, what stock tickers could I buy? RobinHood doesnt show VIX.
Any time the Vix index pops, short Uvxy. The decay alone basically makes it foolproof.
Honestly, just stay away. Vix is a disaster waiting to happen for most.
Posted on 7/14/16 at 8:52 am to TigerDeBaiter
So, whoever downvoted this hasn't looked at the chart. In 5 years UVXY has gone from $490,000 to about $6.50. Mostly due to reverse splits, but still. It's a deadly instrument. Stay away unless you know what your doing. 
When someone asks how to "convert to Vix" they are going to get absolutely slaughtered.
When someone asks how to "convert to Vix" they are going to get absolutely slaughtered.
Posted on 7/14/16 at 9:57 am to TigerDeBaiter
I didn't downvote. Ask the guys in the natural gas thread that traded the leveraged and leveraged inverse. I generally never touch that stuff. FTR, I buy VIX calls. I have a loss certain. I don't trade, although from time to time the resulting gain/loss is like a trade. I but VIX calls as portfolio insurance.
Posted on 7/14/16 at 9:59 am to Iowa Golfer
time to pick up some VIX calls?
Posted on 7/14/16 at 10:13 am to Iowa Golfer
quote:
I buy VIX calls.
That is the only way to go if you want to insure long positions by means of the VIX. And that's all that should drive one to the VIX, insurance.
It's crazy that leverage VIX instruments actually exist. While there isn't a "ceiling" on the VIX, in reality there sort of is because of central bank intervention. The plunge protection team will always be there to step in and cool things off. Which is why a leveraged VIX instruments will always be a short. Would I short it now? Hell no. But was it a killer short after Brexit. Yes.
This post was edited on 7/14/16 at 10:14 am
Posted on 7/14/16 at 12:54 pm to TigerDeBaiter
Yeah, I wasn't too much on Brexit, but I should have been as that was easy money.
I floated this today, fill or kill.
Buy Open 250
VIX Dec 21 '16 $20 Call
Sell Open 250
VIX Dec 21 '16 $30 Call
Net debit - 1.45
Total - $36,250
Commission/fees - $22.50
Routing liquidity rebate $3.69
It killed as it was well under market. And likely too many contracts for that far out.
I floated this today, fill or kill.
Buy Open 250
VIX Dec 21 '16 $20 Call
Sell Open 250
VIX Dec 21 '16 $30 Call
Net debit - 1.45
Total - $36,250
Commission/fees - $22.50
Routing liquidity rebate $3.69
It killed as it was well under market. And likely too many contracts for that far out.
Posted on 7/14/16 at 2:21 pm to Iowa Golfer
Might get a fill on that tomorrow, who knows? VIX near record lows.
Posted on 7/16/16 at 9:27 am to Hawkeye95
quote:
generally if you ahve to ask about a finance topic, you shouldn't consider doing it.
TRUE!!!
Posted on 7/17/16 at 12:00 am to TigerDeBaiter
Are there even shares available to short for leveraged ETFs?
Posted on 7/17/16 at 11:23 am to LSUtoOmaha
Yeah, depends on brokerage though. I know interactive brokers usually does.
Posted on 7/18/16 at 11:07 am to anc
quote:If you want to learn, throw $100 (or whatever your'e comfortable with losing) at TVIX. It's available on Robinhood, and it's basically twice as volatile as VIX, but it's never that simple...
If I wanted to convert to VIX, what stock tickers could I buy? RobinHood doesnt show VIX.
quote:
Most people buy TVIX as a contrarian investment, expecting it to go up when the equities market goes down. It does a respectable job of this with the median TVIX’s percentage move being -4.8 times the S&P 500’s percentage move. However 18% of the time TVIX has moved in the same direction as the S&P 500. So please don’t say that TVIX is broken when it doesn’t happen to move the way you expect.
With erratic S&P 500 tracking and heavy price erosion over time, owning TVIX is usually a poor investment. In fact, even the provider’s marketers who you’d expect to figure out a positive spin, state that “The long term expected value of your ETNs is zero.” Unless your timing is especially good you will lose money
How does TVIX work?
Posted on 7/18/16 at 2:12 pm to bayoubengals88
I don't think TVIX is the direction he'd want to go as someone new. First, assuming he's trying to insure against a market drop, or wants to make a pure bet on a market decline, he'd be better off doing some research on what VIX is, and some research on buying a call option. If his purpose is anything other than the two I mentioned, the advice to him is read.
Just my opinion. I used to trade extensively back in the 90's, and a leveraged product that has an underlying of something that already has rapid deterioration is probably not the best place to start someone who doesn't even know what VIX is. I barely touched these types of products then, and never touch them today.
Just my opinion. I used to trade extensively back in the 90's, and a leveraged product that has an underlying of something that already has rapid deterioration is probably not the best place to start someone who doesn't even know what VIX is. I barely touched these types of products then, and never touch them today.
Posted on 7/19/16 at 9:51 am to Iowa Golfer
I agree. That's why I proposed starting with a number that he'd be ok with losing. It could be as little as $20 using Robinhood. He'd learn a good lesson that way or get really lucky!
Lot's of people get really lucky using Robinhood, but that luck always runs out if I had to guess. I for one, am not good at swing trading. I'm too impatient.
Lot's of people get really lucky using Robinhood, but that luck always runs out if I had to guess. I for one, am not good at swing trading. I'm too impatient.
Posted on 7/19/16 at 4:51 pm to Iowa Golfer
I have my 401k balance in a growth with income category, moderate risk. I am cautious about the market going down and losing the gains I have built up. I am only 30, but I would like to preserve to gains the account has made. What would this board advise?
Posted on 7/19/16 at 5:07 pm to ALTiger
Read up about his VIX insurance strategy.
OR
Let it ride. Thirty is plenty young enough for dollar cost averaging.
OR
Let it ride. Thirty is plenty young enough for dollar cost averaging.
Posted on 7/19/16 at 7:46 pm to ALTiger
quote:
What would this board advise?
You're only 30. That means you cannot even access your 401k dollars for another 29.5 years. You need to position yourself aggressively. Surely, the market will be higher than it is today in 30 years.
Posted on 7/19/16 at 7:52 pm to 3morereps
^^ this. 100% Equities. Put it in the vanguard total market index fund and forget about it.
Posted on 7/20/16 at 3:35 pm to CajunTiger92
When do we hit 19? 
Posted on 7/21/16 at 8:04 am to jimbeam
delete
This post was edited on 7/21/16 at 8:19 am
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