11/26 Daily Summary

Not much to add Today, except the market didn't move. One thing to note is that it seems my position lost a couple % points of P/L. Not sure what happened, it might be the spreads being out of wack or something like that. I will evaluate more carefully once I get some quiet time. For now, enjoy your Holiday! Cheers! Gustavo

11/24 Daily Summary

Today I happened to be watching in the AM when the market was trading at my adjustment level. Instead of hedging with contingent order, I did a butterfly roll and moved 2 of my short calls to the up-side. The short deltas on the 2125 calls is at .65 and it is time to get rolling. I did not roll all contracts just yet as we have been in a wild zig-zag mode so I want to get reassured of the direction we're moving before rolling all contracts.

Note: This was not deviating from my plan, because my goal with the long call is simply to hedge because they're easier to fill by contingent orders, I then roll the short calls when I can (usually next morning), since I was watching I went straight to the rolling instead of hedging first.

Happy Thanksgiving everyone!!

11/23 Daily Summary

I've started a self-assessment as part of my daily routine, the goal is to flag situations that bring me in a negative state and what can I do in order to improve both my feelings and overall well-being. Needless to say, I'm a bit unhappy with myself Today after the market rolled down just after I hedged the up-side risk. This is one of those things that one must master: the ability to be consistent with what you do, and the ability to manage the future and not dwell in the past, so this would affect me a lot more in the past, it bothers just a bit nowadays.

The position is in decent shape, don't get me wrong, it will make money. What bothers me the most is that I've set myself up with the evening game plan and use of contingent orders to help me navigate the day-by-day of trading. I've realized several months back that decision-making during the "lunch hour" for me was not the right approach. I've decided it was best to get hit on an overnight gap than trying to predict the next morning's action based on a 5 minute look at the market. Hence the contingent orders. Yesterday when I pushed the order manually I broke my own rule. Of course, the market took no reservations in pulling back.

11/22 Daily Summary

It seems we're back on the bullish mode, when we can't seem to stay down. I was happy during the morning, and then not so happy by end of day when I saw we recovered and got close to my adjustment point. I then executed the long call to hedge my deltas. I might have added a bit to much on the call side by trading the JAN 2000 call instead of the 2025 as I had on the original plan. Let's see what happens Tomorrow.

Today I'll start tracking my feeling and state of well being mode. I'll work on the tracking log for this and will start monitoring on a daily basis. I think the key will be helping me flag states of low well being so that I can figure out ways to adjust the TRADER just like I adjust the trade on a daily basis.

11/21 Game plan for Tomorrow.

Just to keep it on the record, here is my game plan for Tomorrow. Not much different than the one on Friday, except that I'm pushing the up-side adjustment by 5 points because of the extra weekend of time decay.

NOV10 NDX Iron Butterfly - Day-by-day Review

NOV10 was a wild month, the market started moving higher and higher, without any stop in the horizon. In addition to this, we had the FMOC meeting event, this kept vols up while the market traded higher and made the butterfly further difficult to manage.

I've adjusted, rolled the call side up, added the butterfly. In my mind I did everything I could to keep my money in the game and working for me. In the end closed with a loss of 6%, not bad given the market conditions. For the most part my management was good, I do have some lessons learned that I can share with you:

1) Trading is 100% in your mind, you need to do whatever it takes to stay sharp. Take time for yourself, workout, manage work-life balance.. The brain is the machine and if you're tired, you'll operate at less than optimum capacity. I was tired during most of the nights when I was doing my reviews. I had quite a busy month at work, pulling 13 hour days for weeks in a row. This reduced my ability to stay sharp in the evenings and sit with a good mind to review my positions and plan my adjustments. There was limited time during the day where I could pay attention to the market. Once again, the 13 hour work schedule forced me to start working at 7 am and roll through lunch.

3) Keep an eye on GAMMA at all times: There was one or 2 days where my gamma exposure was twice what I usually see. I didn't notice them until it was too late. Of course, the market did what it does when you're not paying attention: It moves quickly and far, takes away your money and leaves you frustrated.. Notice my postings between 11/10 and 11/11.. In two days I was thrown back in bad shape. I managed to keep my head cool, and got in with good adjustments, in the end I had another 2+ standard deviation movement, but because I was watching the GAMMA exposure, this move did not wipe me out, on the contrary, I actually recovered another 2% that day.

Ok, these are my two very important lessons learned. Need to incorporate them in my day-to-day management so they stay around.

10/20 Daily Summary

10/21 Daily Summary - High point of the trade, 4%

10/22 Daily Summary

10/25 Daily Summary

10/26 Daily Summary

10/27 Daily Summary - Kept going higher, Vols are high due to FMOC

10/28 Daily Summary

10/29 Daily Summary - Larger intra-day swings, vols up

11/1 Daily Summary

11/2 Daily Summary - Hit up-side adjustment just prior to FMOC day, flat VEGA

11/03 Daily Summary - Took advantage of high vols, cut and rolled a few contracts, negative VEGA again

11/04 Daily Summary - Large up-side movement

11/05 Daily Summary - Added butterfly in the morning, well positioned for Friday

11/08 Daily Summary - Rolled 1 call side, good recovery, back to -4%

11/09 Daily Summary - Kept condorizing, market moving to down-side

11/10 Daily Summary - Pumped back up, down 2%, did not notice 2+ Gamma exposure

11/11 Daily Summary - Down-side move, triggered adjustment, gamma around 1.89

11/12 Daily Summary - Took big hit (from -4 to -12%) with large price movement

11/15 Daily Summary - Good recovery, gamma now around 1.15

11/16 Daily Summary - Another large move, no major P/L slippage, closed the trade

Ok, Today I can't login to TOS for one reason or another, the market didn't move much and I could tell by end of day the position was recovering from Yesterday's move. Will re-post over the weekend or once I can get in TOS. Cheers!