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Archive for April 9th, 2011

Deep OTM NP Strategy – APR Week 1

Posted by mounddweller on April 9, 2011

Fellow Traders,

Bad news!  Not a single new trade met our selection criteria this week.  That hasn’t happened before.  I suspect the culprit is the low amount of volatility in the market as measured by the VIX.  It closed Friday at 17.87.

While there weren’t any new selections a number of stocks from earlier selections this month did reappear.  The one that most interested me was RMBS.  It closed Friday at $19.35.  The APR $17 put has a bid price of $0.11.  Thus, with only 5 DTE you can get a 0.65% ROIC with 12.7% DSP.

If the bid price holds up at the open on Monday and I can sell for $0.11 I may sell a few of these.



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