No downside risk trade on Emerging Markets (70% probability)

With 32 days to expiration and a 42 IV rank I Sold the 39.5 Straddle and bought the 38.5 Put, now If the price corrects down we don't have any risk to the downside.

The Trade:
Short 39.5 Call
Short 39.5 Put
Long 38.5 Put
Total credit of 1.15 per contract.

70.5% probability of profit

评论:

With a 1.5% move to the upside today we are above our break even point so it's time to play some defense.

Step 1: Closed the Vertical Put spread for almost the full profit (88% of max profit) $0.56 per contract.
Step 2: Roll the 39.5 Call forward to extend duration --> 38 Days to expiration and collected an additional $0.31 per contract.
Step 3: Sold the 39.5 Put (38 DTE)for $0.35 to make it a Straddle.

Here are our new Break even:

交易开始:

This one I could have closed for a nice profit when we had the big gap with Brazil, but I forgot about it. So now we are back at our break even and with 21 days to expiration I decided to roll once again (41.5 Puts and 39.5 Calls)and now we are inverted.

We have collected in total $2.65 and our break even now is at $42.16. We need price to stay between 41.5 and 39.5.

交易手动结束:

With 21 days left and back in the green, I decided to close this trade for a scratch.