Today was a great day! I had contingent orders that took care of me on the MNX position, and by the last hour of trading I cut my deltas back and got ready for the long weekend. Both trades are in the middle of their profit zone, and if we have a flat day on Tuesday, I'll be cashing out at my targets.
One reader asked me about the contingent orders in TOS, I added a quick posting showing how I set them up. TOS has a few tutorials showing a lot more details on how to put them together.
Position's Details:
09/04 TOS Contingent orders
09/04 IBM Calendar
09/04 RUT Iron Butterfly
09/04 MNX Iron Butterfly
Friday, September 4, 2009
09/04 TOS Contingent orders
A blog reader asked me about how do I set up the contingent orders on TOS, I've posted bellow a real example of an order I had Today on the MNX Iron Butterfly. Notice a few things:
1) I usually will give up a bit of money from the "mid" price, the way I think about it, it is the cost of doing business where I'm paying the market maker to take care of my trade without forcing me to be staring at the screen all day. I give up a bit of money, but they take care of the trade while I'm on the day job.
2) I learned the hard way NEVER to have an order running as soon as the market opens (see second area in green). I have my orders trigger about 30 min. after the market has opened. Why? If there is a gap, the order will trigger right away with whatever prices are comming in the TOS pipeline. I had a RUT contingent order once trigger at a price 10 times higher than what it should be, luckly I was up and watching the behavior and was quick enough to get out of the order before they filled me. I also noticed that early in the trading session the prices are higher, and if you get in too soon, you end up paying more than if you waited.
This is where my trade would have ended up Today without the orers, notice my delta would be twice higher, and I'd be down more money than I had by the end of day.
1) I usually will give up a bit of money from the "mid" price, the way I think about it, it is the cost of doing business where I'm paying the market maker to take care of my trade without forcing me to be staring at the screen all day. I give up a bit of money, but they take care of the trade while I'm on the day job.
2) I learned the hard way NEVER to have an order running as soon as the market opens (see second area in green). I have my orders trigger about 30 min. after the market has opened. Why? If there is a gap, the order will trigger right away with whatever prices are comming in the TOS pipeline. I had a RUT contingent order once trigger at a price 10 times higher than what it should be, luckly I was up and watching the behavior and was quick enough to get out of the order before they filled me. I also noticed that early in the trading session the prices are higher, and if you get in too soon, you end up paying more than if you waited.
This is where my trade would have ended up Today without the orers, notice my delta would be twice higher, and I'd be down more money than I had by the end of day.
Today was an ev
09/04 IBM Calendar
There is a volatility-related sag forming on the position. It happened because I got the 115Calls when the market was moving down and the vols were high, now we retraced the vols went away and the trade has yet to show profits. I'm debating if exiting the position, will double-check it by the middle of next week.
Previous Posting:
09/03 IBM Calendar
Previous Posting:09/03 IBM Calendar
09/04 RUT Iron Butterfly
RUT almost got to the 20% profit target Today, the profit potential is very good and there is still Plenty of Theta to go along. If we end the day flat on Tuesday I'll be doing really good on this trade.
Previous Posting:
Previous Posting:09/04 MNX Iron Butterfly
Volatility is now back to where it was earlier in the week, and with the long weekend comming up I decided to keep the delta as flat as possible and still collect good Theta. If we end the day quiet on Tuesday I'll be out of the trade, otherwise I'll stay with it.
Previous Posting:
09/03 MNX Iron Butterfly
Previous Posting:09/03 MNX Iron Butterfly
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