HiPOS Weekly Update: Looks Promising

By Derek Moore

Where the HiPOS Trade Stands

With 2 more full days of trading left, the S&P 500 Index (SPX) currently sits over 21% above the short 3200 strike.

We can see on the graph above, this means there is a substantial buffer between not only the short strike of our put spread, but also the purple curved line. From the day we entered the position until now, the markets have moved higher and sideways. Perfect climate for a HiPOS trade.

While we can never say for sure a trade will result in a full profit, we can say it looks promising!

What to Expect Moving Forward

Assuming the SPX doesn’t make a drastic reversal, we’d anticipate the current short put spread to expire worthless Friday.

Sometime over the weekend accounts would reflect the expiration in the activity. ZEGA’s traders are already scoping out the volatility landscape to identify our next HiPOS trade. With the VIX Index remaining elevated, we’d expect to find a new position sooner than later.

At times HiPOS can remain in cash for a bit between expiration of the old trade and initiation of the new one.

We’ll keep this one short and sweet but plan on being back next week with an update once a new trade happens.