This marked the worst week of the year. The market fell ~4% or 70 SPX points right at the tail end of our trade. The silver lining is that it’s the best time cycle of the MIC to have been in. If it was the beginning or the middle, it’d be a lot worse. In fact, if things smooth over or if there is little downs we’ll likely end up with a much higher profit than possible before because of all the debit spreads (insurance) we bought on the way down. As long as the market doesn’t fall too much more in after hours as it already has, we’ll be A-OK.
Now on to Friday: Everything was good until about the last 20 minutes of trading. SPX was at about 2024 a very ideal and delta neutral area for us. I was very happy and looking forward to enjoying the rest of my night. All was good. All setup for the weekend. However, the market had other plans, It then proceeded to fall to about 2015 within 5 minutes. We started to prepare for an adjustment with 10-15 minutes left to go in trading. We got one through making us decently positioned @ 2015 with our next adjustment at 2000. However, in the last 2 minutes the market just collapsed and fell to 2003 and the VIX surged. 2003 is near but not quite our next adjustment point. I wanted to do another adjustment to get us right delta neutral before the weekend but the market fell so fast and within only a minute or two of close. In after hours trading the marketing fell another chunk to 1997 unfortunately, the market was closed and but we weren’t able to adjust. So within 20 minutes the market fell from 2024 to 1997. Not ideal. I am not hating our position as the next week is one of the most seasonal bullish weeks of the year but I don’t like going into a weekend being right at an adjustment point. It seems no matter how hard you plan to be risk averse, things can still bite you in the ass. The great thing is our theta is extremely high and should offset any movement.