As I have mentioned multiple times over the past week or so, the VIX is likely to go back up next week.
It did start it's upwards move yesterday and jumped a fair bit today.
What caused it?
The inflation reading is still very high.
VIX Daily Chart
What does this mean to options traders?
When the volatility is high and there is fear in the market then it's actually safer to sell options because the premiums are much higher allowing traders to go further away from the price of the underlying (e.g. stock).
So what's my trade for today?
I decided to go naked on #AAPL (#Apple). If we have a look at the daily chart (below) then we can see that the price is at its pretty much at the bottom of it's recent range. But this company is as solid as any so I feel that selling a $125 naked put is pretty safe bet, despite the overall market conditions.
AAPL Daily Chart
Trade Type: Naked Put
Expiry: 15 Jul
IV Rank: 62.5
Cap Req: $1152
Annualised Prof at Expiry: 80%
IMPORTANT: Studying previous trades provide the opportunity to everyone to learn a great deal so I encourage you to click on the links below and digest the info.