Still Kicking – Thanks VIX

I started today down $6500+ in my account and every time I refreshed the screen I improved a little until I was down $4900.  At that point I stopped being able to access my TD Ameritrade account.  A friend of mine said he was having the same problems from his house.  I came home for lunch and am now able to log in.  I’m down less than $2300 now.  Funny to be happy about that, but it’s all perspective I guess.

A few of my limits hit this morning too.  That means I’ll likely be better off in 1-2 months than I am now due to time value deteriorating.  The CBOE Volatility Index (^VIX) spiked today, which I’ve been waiting for.  That helps with my theory that this might be the capitulation we’ve been waiting for.  The VIX made it over 37 this morning before coming back down to around 30 right now, still up for the day.  Selling options while the VIX is up can be a quickly profitable move, as long as it comes back down.

I sold one CAT Feb 65 covered call (CATCM) on the 100 shares I currently own.  I sold OTM with the hope CAT would recover some.  I also have 2 CAT Feb 62.50 naked puts I’m short still.  Maybe I’ll luck out and have all of them expire worthless.

I sold four ITM AA Feb 27.50 calls (AABY).  I’m already short four AA Feb 30 puts and plan for these to balance those out.  If AA closes at expiration between approx 27 and 30.50, I’m close to break even.  I’ll cover this strategy in more detail later, closer to expiration to explain my genious move or stupidity.

I sold three VIP Feb 40 calls (VIQBH).  I’m already short three Feb 35 puts, so anything between 35 and 40 at expiration and I profit on both. I now have a cushion of ~$2.80 on either side of those strikes to break even.  That’s a wide path to stay between, but a long time (relatively) to get there.