Business Magazine

Volatility Sellers Step In As SPX Slips

Posted on the 17 April 2015 by Phil's Stock World @philstockworld

Implied volatility on the S&P 500 Index (Ticker: SPX) popped Friday morning amid a more than 1.0% decline in the index to the lowest level since April 9. The roughly 12% move higher in the reading of IV on SPX is perhaps the motivation for sellers of iron condors in the April 24 expiry options contracts. The trades were of different sizes and at different striking prices. One of the trades was constructed through the sale of the Apr 24 ’15 1875/1975 put spread against the sale of the Apr 24 ’15 2140/2210 call spread at a net premium of $0.55 per contract. The 1,500-lot trade makes maximum potential gains of approximately $82,500 as long as the SPX trades above 1975 and below 2140 at expiration next week. The smaller of the two condors yields a net credit of $0.50 per contract and involved the sale of the 1885/1985 put spread against the sale of the 2150/2210 call spread. The seller of the 500-lot iron condor stands ready to bank maximum possible profits of around $25,000 in the event that the index trades above 1985 and below 2150 at expiration. The chart below displays a one-week chart of the VIX, which rallied roughly 14% this morning to 14.44.

Chart – One-week performance of the VIX

Volatility Sellers Step In As SPX Slips


This article will become free after 48 hours (see below for free content). To read the rest of this article now, along with Phil's live intra-day comments, live trading ideas, Phil's market calls, additional member comments, and other members-only features - Subscribe to Phil's Stock World by clicking here.

Do you know someone who would benefit from this information? We can send your friend a strictly confidential, one-time email telling them about this information. Your privacy and your friend's privacy is your business... no spam! Click here and tell a friend!

You Might Also Like :

Back to Featured Articles on Logo Paperblog

These articles might interest you :

  • #HampsteadGardenSuburb – More Than A Village by @kpgtourguide

    #HampsteadGardenSuburb More Than Village @kpgtourguide

    DC Editor Adam writes… Karen's tour of little known Hampstead Garden Suburb goes this Sunday 29th April at 2.30pm from Golders Green tube. It, in a word, is... Read more

    10 hours, 27 minutes ago by   Lwblog
    DESTINATIONS, TRAVEL
  • It's Official - Polish Ice Warriors Will Return to K2 in 2019/2020

    It's Official Polish Warriors Will Return 2019/2020

    This past winter one of the expeditions that we followed closely was the attempt by the Polish Ice Warriors team to make the first winter ascent of K2. Read more

    11 hours, 26 minutes ago by   Kungfujedi
    OUTDOORS
  • Boho Chic Wedding in Santorini

    Boho Chic Wedding Santorini

    The boho chic wedding we are sharing today has mesmerized us! Taylor and Justin love exotic sunny destinations and during one of their trips they discovered... Read more

    12 hours, 42 minutes ago by   Eleni Balkouli
    LIFESTYLE, TRAVEL, WEDDING
  • The Xroadie Files

    Xroadie Files

    Lord of Pagathorn – Diamono Philia Sedit – Bass, Hellwind – Vocals/Drums, Corpselord – Guitar/Bass/Vocals Intro Nietzscherion strange guitar sounds... Read more

    12 hours, 57 minutes ago by   Ripplemusic
    ENTERTAINMENT, MUSIC
  • Marvelous Mother's Day Gifts!

    Marvelous Mother's Gifts!

    Mother's Day is in a few weeks and I'm sometimes still in awe that I've been a Mom for the last four years now. As a parent, the kids and Zach always try to... Read more

    13 hours, 27 minutes ago by   Cait
    LIFESTYLE
  • Black and Gold Hues Wedding Inspiration with a Modern Flair

    Black Gold Hues Wedding Inspiration with Modern Flair

    Today, we’re sharing with you a wedding inspirational shoot that took place in Santorini, an ideal summer destination. An impressive table with black and gold... Read more

    14 hours, 23 minutes ago by   Eleni Balkouli
    LIFESTYLE, TRAVEL, WEDDING
  • A Fun Class

    Class

    Last night was the tenth and last meeting of my Wordplay class -- and what fun it's been! The students have written to prompts of taste, touch, smell, sound, an... Read more

    14 hours, 27 minutes ago by   Vickilane
    CREATIVITY, PHOTOGRAPHY

Magazines