10-08-2020, 06:21 PM
I'll be gentle.
First, if you HAD to make an oil play and use options, USO would have been a way better choice. Nickel wide bid/ask tons more volume and strikes every dollar.
Second, the $30 premium was too low IMO for oil. Even T pays better. With such a low premium, you hardly get a chance to take it off early and make any money.
Third, as a defense, the most I would do, in the words of fellow Chicagoan Dan Sheridan, is buy a stinkin' put if it's running down on you. Might have taken a small loss or even made money in your example.
Fourth, when a trade no longer accommodates your original thesis, IT'S OVER.
You are not alone in your process, far from it. my late friend used to defend every single position so that no underlying got the best of him. Waste of time and tied up capital, but he wouldn't change.
Lastly, I know we like the action, engagement, excitement whatever of these positions but in all honesty it would probably be better to sell put spreads on expensive index products. a RUT put spread 1560/1540 has 2.10 credit. If it goes nowhere or even up or down a smidge on Monday you can take it off and keep a buck
First, if you HAD to make an oil play and use options, USO would have been a way better choice. Nickel wide bid/ask tons more volume and strikes every dollar.
Second, the $30 premium was too low IMO for oil. Even T pays better. With such a low premium, you hardly get a chance to take it off early and make any money.
Third, as a defense, the most I would do, in the words of fellow Chicagoan Dan Sheridan, is buy a stinkin' put if it's running down on you. Might have taken a small loss or even made money in your example.
Fourth, when a trade no longer accommodates your original thesis, IT'S OVER.
You are not alone in your process, far from it. my late friend used to defend every single position so that no underlying got the best of him. Waste of time and tied up capital, but he wouldn't change.
Lastly, I know we like the action, engagement, excitement whatever of these positions but in all honesty it would probably be better to sell put spreads on expensive index products. a RUT put spread 1560/1540 has 2.10 credit. If it goes nowhere or even up or down a smidge on Monday you can take it off and keep a buck