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Options-strategy

100x idea - bitcoin call optionThe Trade: Buy call option on BTC or MSTR with the end of year expiration. *Potential gains: 100-150x *Odds: for you to decide, but IMO it's at least 10-20% which makes the expected return of 16 to 28x Why: I believe the BTC price to follow a predictable price cycle, driven by the halving events (every 4 years) which the halving of block reward cause a supply shortage of BTC and drive the BTC price to a new high. In the first (Nov 2012) and second(July 2016) halving, the price peaked around 1 year and 3-4 months afterwards. We had the 3rd BTC halving event in May 2020, which means we may see a peak as early as the end of Sep 2021, but I’m willing to give it time until the end of the year which makes it 1 year and 7 months after the most recent halving. How high can BTC go? I like the stock to flow cross-asset model (S2FX) by PlanB, but many people think the model is already invalidated. The S2FX model attempts to predict the price of BTC based on the stock to flow ratio of bitcoin. Stock is the existing supply of the bitcoins; flow is the current rate of new bitcoin mined in a year. Hence the stock to flow ratio is how many years will the existing stock size double. Here is the link to the model, PlanB explains this way better: google "PlanB S2FX" According to the S2FX model, we will hit a medium price of 288K dollars per coin during the current halving epoch. As of today, the BTC price is around 32k dollar per coin, which present a possible 9x gain if it will reach 288k. We can take on some risks to increase the gains and it's a bet with a beautiful outsized return, mad gains if you will. How: Call Options As call options have limited risk (lose all your option premium), but unlimited upside, this is the perfect tool to bet on BTC's potential explosive price increase from 32k to 288k by end of this year. *E.g. BTC call option with a strike price of 64k dollars and an expiration of 31 2021 is trading around 1.5k dollars per contract (1 BTC per contact). Potential profit if S2FX is right: 288k-64k = 224k (149x) Alternatively, this can be done with MSTR stock, as the company is currently holding 105k of BTC and I believe it to be trustworthy in holding on to the BTC. We can use MSTR stock price as a BTC proxy. According to my model, if MSTR maintains the current BTC holding by end of the year with 288k dollars per BTC, MSTR stock price could easily go over 3400 dollars per share, from 550 dollars as of writing. *E.g. MSTR call option with a strike price of 1400 dollars and an expiration of 21 Jan 2022 is trading around 1.6k per contract (100 shares per contract). Potential profit if S2FX is right: (3400-1400)*100=200k (125x) Position sizing/risk management How much of your portfolio should be allocated to this trade is highly individual but think about the following: Because of the huge potential gains of this trade, a 1% allocation can more than double your entire portfolio, even at 0.5% allocation can your portfolio by over 50%. I’m committing 5% of my portfolio to this trade. Stay invested & Best of Luck *no financial advice*
BNC:BLX
by TressureCave
1
the chalk or the longshot - pick your poisonUVXY traded upward 20% on 3 January 2020. that was the day the Iranian General, Solemani, was - pick your characterization basd on your politics - murdered assassinated etc. In February 2018 UVXY rose 110% in one session. In March 2020 The Covid spike was $12 to $130 in two weeks. Absent these outliers, UVXY has dropped from over $30,000 in 5 years with the most recent reverse split to $28 today. Along the way there are always these short term interuption of the downward bias based on fear. Fear fuels the spikes. whether it is SPY fear, volatility in all world markets or the spectre of Iranian oil market retaliation. The portfolio of UVXY is completely available cash and the purchase and sale of short dated volatility instruments that are rolled every month. Time decay erodes the portfolio until the spikes occur. Yesterday UVXY Net asset value dropped 10%. Those who thing that some volatility should be in a portfolio for the downside protection,r for the gain on instability can today buy the risk on cost to hedge for 48 days at $2.50 with unlimited upside gain. It is possible to reduce that cost with a put vertical that has a lose $2.15 and gain $15 hedge that expires in mid September with a complete loss. A larger portfolio that has a dividend aristocrat leaning will likely sell the common or buy a September $29/$15 put veertical for $704 to earn $698. Why the discrepancy? The pricing tells the story. A trend that is inexhortably downward yielding less, or a guess as to the upward spike in volatility. the chalk is downward. the longshot is the volatility spike for any narratice the investor chooes to believe.
CBOE:UVXYEducation
by Spotshooter1983
1
XRT ETF Bullish inclined Naked Puts 20 Aug ExpiryI entered this XRT trade with a high BP of 59K because I wanted to reduce my exposure on VXX. I'm getting the feeling that the market is reaching a stage where the bullish steam is running out. Especially with rising Inflation concerns. VXX to me is dangerous because it is exposed to Tech stocks which are currently sky-high and a drop in tech could be pretty ugly. What irritated me was that one day later the market drops due to inflation worries and the prices of my XRT contracts increases... I think I need to look at planning my selling of contracts together with the economic calendar as high volatility gets me a good price also. Good new is that the retail sales numbers unexpectedly rises by 0.6% in June and this basically shielded XRT to an extend. Sold 70 Puts @ 0.50 Strike 85 BP Block: 59K Max Gain: Est $3500 % Distance to Strike: 10.61%
AMEX:XRTLong
by Ronin_trader
[Intraday] BankNifty Short Bet Bearish Flag Sell 35300 CE Next Expiry if this line breaks ! Note - One of the best forms of Price Action is to not try to predict at all. Instead of that, ACT on the price. So, this chart tells at "where" to act in "what direction. Unless it triggers, like, let's say the candle doesn't break the level which says "Buy if it breaks", You should not buy at all. ======= I use shorthands for my trades. "Positional" - means You can carry these positions and I do not see sharp volatility ahead. (I tally upcoming events and many small kinds of stuff to my own tiny capacity.) "Intraday" -means You must close this position at any cost by the end of the day. "Theta" , Trade Setup based on option Decay ! ======= I won't personally follow any rules. If I "think" (It is never gut feel. It is always some reason.) the trade is wrong, I may take reverse trade. I may carry forward an intraday position. What is meant here - You shouldn't follow me because I may miss updating. You should follow the system I share. ======= Like - Always follow a stop loss. In the case of Intraday trades, it is mostly the "Day's High". In the case of Positional trades, it is mostly the previous swings. =======
NSE:BANKNIFTYShort
by ShivamMendhare
VXX Sold Calls - 16 Jul & 23 Jul ExpiryI'm weary of my exposure to VXX and will try to reduce my exposure to it. For now, the price action seems to be stabilizing below the S/R line of $38. This month's entries seem tight due to the price offerings and when I entered. I'm not totally happy but it is manageable just not as defensive (Previous VXX trade I could get a good price at +60% from the strike) I might exit these trades a week early and take a smaller profit so that I can get better Aug prices. My Concerns on the VXX: 1) Inflation worries seem to be quietened but this will come back 2) VXX has an exposure to the Tech sector and that sector is pretty volatile especially with it's crazy bullish moves Sold 45 Calls @ 1.02 Strike 51 - Expiry 16 July Sold 15 Calls @ 0.82 Strike 46 - Expiry 23 July BP Block: 53K Max Gain: Est $5285.76 % Distance to Strike 51: 37% % Distance to Strike 46: 29%
CBOE:VXXShort
by Ronin_trader
XRT ETF Bullish inclined Naked Puts 23 July ExpiryI originally planned for XRT to take up 45% of my BP but some how my week earlier VXX trade's required BP suddenly increased and so for July XRT is back to around 30% BP So far it seems like the inflation worries have been quietened at least for the time being. I do feel it is a matter of time. This is why I need to reduce my exposure to VXX as it is very vulnerable to the tech sector which is very volatile. XRT is retail and seems somewhat conservative at this point, but I need to find one which is more inclined towards consumer staples. Sold 45 Puts @ 0.85 Strike 85 BP Block: 48K Max Gain: Est $3825 % Distance to Strike: 9%
AMEX:XRTLong
by Ronin_trader