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.

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