Long Dated GS Income (paper trade)

[cwelsh 1,502]

Again, this is a paper trade, and I will be using worst case fills:

GS at 119.50 at start

Long Dec 110 Call (11.30)

Long Dec 130 Put (12.20)

Net debit: $23.50

Short Nov 1 125 Call .29

Short Nov 1 115 Put .56

Net credit: 0.85

(note: the deltas on the short really lined up pretty miserably, Impossible to get much further from the goal of .30, so this is about the minimum credit we should expect)

[cwelsh 1,502]

As with SNDK, GS is getting close to the 125 strike, so I would roll this today.

Closing out last week's 115/125 would cost .48, leaving a profit of 0.37, or 1.6%.

I then open next week's 120/130 for a $1.00 credit.

[cwelsh 1,502]

If you were trading this in your real portfolio, hopefully you closed the 120 side yesterday. When it hit 120, the 120 put was right at $1.15. Closing out the 130 call today would cost .01, or a loss of 0.16 on the week, or 0.6% (basically BE).

Then this week we would sell the 115/120 for $2.50 -- this is not ideal, but there is no .30 call delta available.

As this is a paper trade, I'll check again tomorrow, and might track opening on Friday as well.

[cwelsh 1,502]

Closing the Nov 8 trade would have cost 1.60 (close on Wed), or a 3.8% gain

On Thursday, open the 11/16 110/120 for .82. Close this last Friday for .42, or a 1.7% gain

Open on Friday the

115/125 for .45 (no good strikes available on Friday), max return of 1.9%

Total return so far: 7.7% -- not as high as I was wanting, but actually is performing fairly well.