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Friday, March 9, 2018

April RUT Elephant

Trade Details:

SELL 20 RUT April 1450/1460 Credit Put spreads @0.60 Credit
SELL 8  RUT April 1670/1680 Credit Call spreads @0.92 Credit

Upside and downside hedges:
BUY  15 IWM April 168 Calls @0.21
BUY    2 IWM April 148 Puts @0.88

Total Net Credit: $1,445
Days to Expiration: 42

For a smaller account ($20,000), this can be played as a 4/4/2/2  and then the hedge: 4 IWM Calls. OR half all that for an even smaller ($10,000) account.

Risk profile picture:


RUT Chart for future reference:


Trade Update - April 2, 2018

Adjusted the 1450/1440 Credit Put spread:
CLOSED 20 Apr 1450/1440 Credit Put spreads @2.20 debit each
Net loss is 1.60 per  (0.60 original credit)
$3,200 in 20 spreads

CLOSED 2 IWM Long 148 Puts @2.88 credit each
Net gain is 2.00 per (original debit paid was 0.88)
$400 in 2 contracts

INITIATED 20 Apr 1375/1365 Credit Put spreads @0.60 credit each
Credit received: $1,200

The current position is now:
20 RUT Apr 1365/1375 Credit Put spreads ($1200 credit)
8   RUT Apr 1670/1680 Credit Call spreads ($736 credit)
15 IWM April 168 Long Calls ($315 debit)
Net Credit: $1,621


Trade Update - April 9, 2018

CLOSED 20 Apr 1375/1365 Credit Put spreads @0.09 debit each
Net gain is 0.51 per  (0.60 original credit) 
$1,020 in 20 spreads

CLOSED 8 Apr 1670/1680 Credit Call spreads @0.08 debit each
Net gain is 0.84 per  (0.92 original credit) 
$672 in 8 spreads

CLOSED 15 IWM Long 168 Calls @0.01 credit each
Net loss is 0.20 per (original debit paid was 0.21)
$300 in 2 contracts


The position is now entirely closed:
1450/1440 Credit Put spreads  (-$3200)
IWM Long 148 Puts (+$400)
1375/1365 Credit Put spreads (+$1020)
1670/1680 Credit Call spreads (+$672)
IWM Long 168 Calls (-$300)

The net final result is a $1,408 loss when all the pieces are accounted for.



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