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Low Risk Weekly DIA Credit Spread (5% gain on capital invested)I'm looking to enter a Put Credit Spread on DIA with the goal of collecting $5-$6 worth of credit per contact with a $1.5 wide spread. I'll be holding till DOE with the intention of growing capital invested by a minimum of 5% for the week. -Current price is: $308 -Credit spread sell strike: $290 -Current price to sell strick: 6.2% -Is price trading above 50 day SMA?: Yes -Is price trading above 200 day SMA?: Yes -Percent OTM if held to DOE upon entering, is: 92% - 94% of being OTM if held to DOE -Technical analysis: DIA is trading above 50 and 200 day SMA which signals that we are in an uptrend. Our sell strick has been placed below .382 (292.5) fib retracement level. This price zone has held as support in the past I'm looking for it to hold again this week. Let me know what you think. Have a nice day.
AMEX:DIA
by zzMOTTS
Black Swan Risk Canary, CBOE Skew Index Similar to VIX, the price of S&P 500 tail risk is calculated from the prices of S&P 500 out-of-the-money options. SKEW typically ranges from 100 to 150. A SKEW value of 100 means that the perceived distribution of S&P 500 log-returns is normal, and the probability of outlier returns is therefore negligible. As SKEW rises above 100, the left tail of the S&P 500 distribution acquires more weight, and the probabilities of outlier returns become more significant. One can estimate these probabilities from the value of SKEW. Since an increase in perceived tail risk increases the relative demand for low strike puts, increases in SKEW also correspond to an overall steepening of the curve of implied volatilities, familiar to option traders as the skew.
S
by QuantitativeExhaustion
23