8 April, 2022 seen 230A time ago I did a lot of crypto options trading, I have made several articles and a few YouTube videos on this topic already, in general, from my own experience I'm quite negative about crypto options as long as they are settled in crypto itself. Time after time re-evaluate my previous findings, so did happen today - I decided to test one more time idea…
Last week turned out very bad, our put side spreads ended in the money, and we booked a loss of -0.0672 ETH at the end of the week.
The loss could be avoided if I would choose to close all trades before the expiry, or even when the strike price of $1,450 was touched. I left the emotions to come in and didn't adjust. Now, the price we are paying is quite high.
At the end of the week, the total value of our crypto portfolio was worth $1,342.42, which is just shy of 13.42% of our $10,000 goal. Last week portfolio lost -16.12% of it's value. In dollar terms -$258.
The Price of Ethereum slipped from 1,500 to under $1,400 and then slightly bounced back. On the expiry we had 3 put spreads with a $1,450 strike price.
When constructing this week's trade I was super conservative and for both sides entered short legs with Deltas under 0.2. In fact, the $1,450 put was around delta -0.15, at the time of writing, meaning it was about an 85% probability it will expire worthless.
Now, it didn't, and also I was not closing or adjusting this trade, while I could.
Now, this happens - options trading can be very dangerous.
On Friday, March 10, 2023, we opened 2 put credit spreads, and one call option:
- put side: 1250/1000 (March 17, expiry)
- call option: 1450 (March 17, expiry)
the total premium received: 0.0284 ETH (40.07 USD)
To keep the max profit, ETH should stay between 1,450 and 1,250. In case of a challenged trade we will try to adjust the trade by rolling up or down the challenged side)
I'm currently working on developing a course on options trading with cryptocurrency, which will cover the basics of options trading, as well as more advanced strategies and tactics for maximizing profits and minimizing risk. Feel free to enrol now!