Friday, October 17, 2008

Paper Trade - Sell OSX Straddle

The Oil Service index is currently trading 135. I say sell the November 135 straddle - it's "35.50 bid", and maybe lean a little long against it. With 36 days to expiration, a seller will collect almost a buck a day.

I'm not putting this trade on as *selling straddles* is not something I've done since I started a family. Too much margin, too little sleep.

These OSX options are what you'd call "fat". The XAU options are through the roof as well.

Anyone short vega [net seller of options] in these markets must have gotten killed this past month. I wonder how Timberhill, the trading arm of Interactive Brokers, has been doing? I wonder about Susquehanna, who in years past had been an aggressive buyer of options, has fared?

I said to my wife the other day,

"The good thing, the silver lining in these major market meltdowns, is that in all likelihood someone you despise just went bankrupt!"


Anonymous said...

Personally, I think that top chart might be the infamous double-bottom. Oddly enough, the same thing my girlfriend promised me for my birthday today! Hahahaa. She did say that but immediately followed up with the dreaded "in your dreams" so it looks like it will have to

CaptiousNut said...

What is a "double bottom"?

Edify me via email.

Anonymous said...

a technical indicator that allegedly identifies a bottom in price. As in the price tried to go lower twice but could not do so, hence the bottom. The double-bottom I was talking about would have been two girls in my bed, fighting to go lower - hahaaa.

The first version, I assume you already knew.

Anonymous said...

NBC just bit this trade. Not two minutes ago...