Monday, March 1, 2010

03/01 NDX Fast Butterfly



Started my weekly Fast butterfly by end of day Today. I made some tweaks over the weekend in my trading strategy for this position. It relates to being able to hedge if we go against it, once hedged, I should enter another butterfly ahead of the market, and as long as the market doesn’t keep pushing much higher fast, I should be able to recover the trade. My goal is to do that in lieu of simply exiting the position every week if down -8%. If I need to hedge-recover the trade, I will give it one more week to allow for the recovery to kick in.

Note: This is the second week I get a big difference in the butterfly’s value approaching the final hour. About 30 minutes prior to closing I got filled at 31.75, then it suddenly dropped down to 30.70. Around the final hour I could not get a fill, and ended up only entering ½ of the position size I wanted. Prices eventually went back up to the 31.75 area, by the end of day. It might be worth catching this discrepancy in pricing next week if it shows up again.

No comments: