Happy quad witching Friday!
Quadruple witching happens every quarter — it’s when options and futures on indexes and equities expire (on the third Friday in March, June, September and December).
Back in the days of trading on the floor, today would be a busy day because positions that expire need to be rolled forward.
The choppy markets haven’t been that kind to us the last few weeks, but we were able to put a winning position on the board.
With today’s drop in volatility and yesterday’s pullback, we’re feeling the heat on the other positions we currently have open.
Because it’s quad-witching day and the start of March Madness, we don’t put too much weight into today’s price action.
So I will hold these open positions a little longer.
But as markets continue to buzz around, I’m thinking of new ways to keep you ahead so we’re not playing on your heels.
Now, The CBOE Volatility Index (VIX), aka the “fear” index, is still above our key 15 levels, trading at 20.
What we’ve seen over the last year is when the VIX level goes into the 20 area, we see a spike, which is due to a pull back in the S&P 500.
The VIX dropped down to 19 earlier this week before we saw the two-day spike into 23 this morning.
Now let’s talk shop.
Here’s a recap of what we did this week.
Buy-To-Open the Vale S.A. (NYSE: VALE) April 9, 2021, $18.50 call (VALE210409C00018500f) up to $0.37 per contract or better, for the day.
Buy-To-Open the Cameco Corp (NYSE: CCJ) April 16, 2021, $22 call (CCJ210319C00022000) up to $0.70 per contract or better, for the day.
Buy-To-Open the International Game Tech (NYSE: IGT) April 16, 2021, $21 call (IGT210416C00021000) up to $0.70 per contract or better, for the day.
Sell-To-Close the Vale S.A. (NYSE: VALE) April 9, 2021, $18.50 call (VALE210409C00018500) at the market.
Right now, we’re holding:
- Schlumberger Limited (NYSE: SLB) June 18, 2021, $40 call (SLB210618C00040000)
- Cameco Corp (NYSE: CCJ) April 16, 2021, $22 call (CCJ210319C00022000)
- International Game Tech (NYSE: IGT) April 16, 2021, $21 call (IGT210416C00021000)
This is our debriefing of every trade closed or expired to analyze what happened, why it happened and how it can be done better — like what the military uses after missions.
Vale S.A. (NYSE: VALE) April 9, 2021, $18.50 call (VALE210409C00018500)
Date: March 15, 2021
Reason: Our monitor triggered this new buy alert after a new $2.3 million dollar Hot Money Trade was just placed in the April 9th expiration.
Outcome: 30% gain.
Notes: We executed this perfectly. We sold when it hit our target, which closed shortly after. That is why we stick to the system and avoid calling audibles.
It’s about time for me to have a margarita by the pool.
I'll have a new trade on Monday, and have a great weekend.
To your wealth, freedom, and options!
Joshua M. Belanger