An Options Spread Trader’s Lucky Celebration
- Posted by chicagosean
- on December 21st, 2012
Yesterday I ranted about my shitty execution skills as I attempted to leg out of some spreads (read here).
During all the tilt I was in as a result of the legging debacle, I accidentally left an open short 142 $SPY call position. It was in Dec4 weekly options that don’t expire until end of next week. Perhaps I looked at them and thought “oh, they are for next week, don’t worry about them.” Whatever, it was an oversight.
Well, I must’ve stored up some good karma somewhere. This morning, I woke up to a notice of “early exercise” on my short call position. Normally, this is an undesirable situation (in fact, 99% of the time this would cost me some money). However, much to my extreme luck, Congress or some politician (I’ve given up paying attention) did something asinine to spook the markets overnight and $SPY gapped down pretty good this morning. And in the extreme opposite of my poor execution skills yesterday afternoon, I flawlessly covered my short SPY shares and re-established my short call position at the exact bottom tick for $SPY today (as of the time I write this). Turned out the assignment resulted in a very nice gain for my account this morning.
My buddy JoeyP said it right when he remarked to me this morning:
P.S. While we’re gloating, can we please address the call I made during after hours trade yesterday as $RIMM was trading north of $15?
Since this message:
NOTE: I did not trade this observation, and therefore did not make a single cent off this call. So feel free to tell me to STFU.
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Sean McLaughlin - Editorial, Curation, & Investor Relations Solutions at StockTwits. Also, former Member of the Chicago Board of Trade who trades his own account in Boulder, Colorado. More »
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