The VIX moved up a bit today, which keeps me highly alert as I don't want to get caught in a rapid volatility expansion, but overall the market has been very calm for the past few days.
This calmness doesn't make me very calm though. There are two loud voices out there: one group says that a major crash is coming, while the other group says that we hit the bottom.
My take is that I don't think that we hit the bottom. There is a major inflation problem and the war in Ukraine is raging. To make things even worse, there are rumours that the Russian leaders may start war in other places too.
The bottom line is that complacency could turn out to be very costly...
So what's my trade for today?
I kind of went to safety and traded #AAPL (#Apple) again. The potential return is not as good as some of the other trades, like X or AAL, but still well over 100%. I selected a very wide strangle, which gives me plenty of room to adjust for more credit over the coming weeks.
Trade Type: Short Strangle
Strike: $125 / 165
Expiry: 15 Jul
IV Rank: 60.3
Cap Req: $1455
Annualised Prof at Expiry: 131%
IMPORTANT: we can all learn a great deal by studying previous trades. Today I adjusted the following positions:
Closed at $1.73 for an annualised profit of 295%.
I could have held onto this position longer as it was a very safe trade but I wanted to free up some capital.