Yesterday some of the experts, with 30-40 years of trading experience, called the market bottom. They still have a chance to be right as the market ended up 'only' 2.22% lower. I personally find it entertaining how so-called experts have the guts to be so bold about their predictions.
As an ex-data analyst, I learnt that no matter how much data you look at you can still be wrong with your predictions, therefore it's best to be humble with predictions. This is especially true for the stock market.
We had another week with tremendous swings and those options traders who could not stay put were smacked around. In trading inactivity often pays off.
I managed to close 5 trades this week but have a couple more with one week till expiry that are looking good. I also had to roll down the call side on a couple of my strangles just to keep my delta a bit more balanced.
So what's my trade for today?
#MS (#MorganStanley). It had its earnings before open today and the price is down by nearly 5%. The volatility remained fairly high so I felt that it was a good prospect for a naked put hoping that it will bounce back up and that the volatility will drop soon.
The stats
Trade Type: Short Put
Strike: $65
Expiry: 18 Nov
Delta: 15
IV Rank: 66.4
Premium: $0.92
Cap Req: $662
Annualised Prof at Expiry: 145%
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.
Closed:
https://www.tycoonitos.com/community/market-comments/market-comments-20221013
https://www.tycoonitos.com/community/market-comments/market-comments-20220920
https://www.tycoonitos.com/community/market-comments/market-comments-20220928 https://www.tycoonitos.com/community/market-comments/market-comments-20220922
Rolled:
https://www.tycoonitos.com/community/market-comments/market-comments-20220524
https://www.tycoonitos.com/community/market-comments/market-comments-20220421
Let me know what you think.
Perfect trade!
Closed at $0.62 for an annualised profit of 551%.