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HiPOS Update: New Entry for April

By Jay Pestrichelli

Today we entered a new HiPOS position. It is a call spread on the S&P 500 index very similar to the one that expired just yesterday, Wednesday the 15th.  This position has an expiration out to May 1st, which is a little longer than the one that just expired. However, it was able to be established farther away at about 12.5% OTM and also provides more time to potentially enter into an Iron Condor by selling puts if the market was to head lower.

The chart above shows both the strike level of 3150 and the purple line where we may get defensive at the time of execution. We’ll keep this update short and sweet, but be on the look out for an update if the market reverses the uptrend of the last two week.

 Now for the Particulars

  • Index: S&P 500 Index
  • Position type: Short Vertical Call Spread
  • Short strike: 3150
  • Long strike: 3200
  • Risk (prob. ITM): <1% at time of entry
  • Targeted return: 0.90%
  • Distance OTM: ~12.5% at time of entry
  • Expiration: May 1st  or 12 trading days to expiration