Merry Christmas and Happy New Year!
With the ultra low trading volume that we are experiencing right now, there is really not much to report on. Market has been choppy without institution participation. It is also unclear as to where the market is heading. Even if the Dow advances another 100 points today or tomorrow, it won’t mean anything if the volume remains low. One day of institution selling is all it takes to cancel a major up-day on low volume and vice versa. All the traders are enjoying their holidays and will most probably come back only next year.
Now is the best time for our positions to waste their time value away. Most of our positions for January are showing paper profit as of now. We’ll wait for an opportune time to close up our positions to lock in the profits. For now we just have to be patient and let the profits grow.
The calendar spreads that I experimented is not showing any profit as yet. The SPY Jan/Feb 142 put calendar is still worth $0.75 while the SPY Jan/Feb 144 put calendar is worth only $0.60. We will take a look at these positions again next week.
In this choppy and low IV market, we are very careful about entering new trades. We are searching as we speak but most of the trades out there are not worth the risk at the moment. We will see how things turn out. Trading activity will most probably pick up after next week. For now, let us enjoy the clam and the decaying of theta.
MarketNeutralOptions wishes you and your loved ones a blessed Christmas and a great year ahead! Enjoy the holidays!
