Tag Archive | "delta"

Weekend Portfolio Update

Sunday, September 28, 2008


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Open trade: Oct SPY Iron Condor #2

Monday, September 15, 2008


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The Difference A Morning Makes

Thursday, September 4, 2008


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Market Neutral, Not Delta Neutral

Tuesday, August 12, 2008


There are plenty of ways to put on option trades that have a neutral outlook: straddles, strangles, condors, etc.  Whereas stock and futures traders are limited to whatever price action the market gives you, options let you take a view on implied volatility (vega), the passage of time (theta), and the rate of change of the rate of change of the option per unit move in the underlying (gamma).  Okay, that last one isn’t so obvious, but the idea is…

8 Hedging Ideas for Iron Condors, Part 1

Saturday, April 26, 2008


What should you do when the underlying moves against an iron condor position you have open? (For example, if you’re a member, you may have noticed that one of our DIA trades for May expiration is looking threatened by the recent price action in the index.) Any time this situation arises, people will always write in to ask about how they can “adjust” or “fix” the trade if the market continues to be uncooperative. It’s an understandable impulse to want…

Short Gamma May Exacerbate the Rally

Wednesday, April 16, 2008


UPDATE: Adam makes basically the same point here. His comment at the end is that this morning’s sustained decline basically sucks the fuel out of any potential gamma fire, which is a good point. Sure, rallies like this are exciting, but on a medium-term view today’s action doesn’t prove much. We’re still within the recent trading ranges on all the major indexes, and although markets have really taken any good news as an excuse to rally and have shrugged…

Pause Day

Wednesday, April 2, 2008

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Indexes were trading at the lows of the day as late as 3:00, but a sustained rally in the last hour made this more of a “pause day”. The big event everyone is watching now is Friday’s non-farm payroll number. We talk a lot about monitoring your Greeks – by late Thursday you should make sure your deltas are in a comfortable spot, or are maybe a little tighter than normal, as any surprise on Friday could be market-moving. Some…

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Jared Woodard specializes in trading volatility as an asset class. With over a decade of experience trading options and other volatility products ... Read More


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