After yesterday’s Federal Reserve announcement of another ¼ point rate cut, the market settled back in as volatility was removed from the market. Now many long time HiPOS followers might logically think higher volatility on Fed announcement day would have been a better environment for the trade?
To quote a famous 1972 song from Stealers Wheels, the market is “stuck in the middle with you”. This may come in handy should you find yourself in a random trivia game, or it could just be a nice analogy to where we’ve wound up in the underlying S&P 500 Index.
Jay was able to speak with Oliver Renick on the TD Ameritrade Network this morning regarding what ZEGA’s traders are looking at in today’s markets. With the heightened volatility lately, Jay went into detail about the Pairs tactic that is used in HiPOS Aggressive.
Click here for a PDF version of our July performance numbers.
After a respite yesterday, volatility came surging back this morning as the markets once again sold off. This leg down along with the rise in implied volatility provided an opportunity to enter a new position utilizing short put spreads going out to September 6th.
The triangle symbolizes delta. Delta represents the change in something else and is quite relevant when we talk options. You see, an option’s Delta represents what the change in its price will be due to a 1-point change in the underlying.