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September 6th, 2011 at 3:36 pm
TLT/Leon – I prefer bear puts spreads to bear call spreads, that’s all. Clearly I’d rather risk $5.50 to make $4.50 than risk $5.80 to make $4.20 for one thing. At $115, if I own the $120 puts, I keep $5 and lose .50. At $115, if you sold the $110 calls for $4.20, you give back the $4.20 plus .80. Also, in between, with a bear put spread, you are selling premium and, with a bear call spread, you are the sucker buying premium. In the end, that difference will grind you down, trade after trade..
Euo $1.398, Pound $1.593, 77.7 Yen to the Dollar so the BOJ is happy, at least. EUR/CHF pinned at 120 all day – when those guys say something – they mean it!
TBT/Willie – See above, I just don’t think the chances of TBT going back up enough to save a position are as good as those of TLT coming back down so TLT is currently the smarter play. Keep in mind that TLT MIGHT go back to 122 or, who knows – some other new, insane high but that would suck for TBT anyway so it’s a question of choosing your poison and I think the math says TLT has better opportunities to profit from a small sell-off.
TOT/Deano – Very good one, they are a good oil company. We haven’t played them since 2009 but they’re not too much higher now ($37 was the low).