Thursday, February 15, 2007

Feb option expiration and Volume Profile strategy

We had a Vigrin POC put in on feb 9th's sell off and that provided as a target for this weeks trading as the bulls still showed support on monday. The VP chart below is detailed with reasons for entries and exits.

Here is an option strategy I was looking at. Selling OTM calls & puts the last week of option expiry to benefit from increasing theta-time decay(look for high vega options). Sell 1 call and 1 put on Monday or Tuesday and close the positions out Thursday unless they are going to expire worthless.
Here's an article on Theta- Time Decay
Here's a good article on Capturing Profits with Position-Delta Neutral Trading.


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