RUT – 08/05/2016

On 8/5 with RUT trading at $1226.64 I decided to enter into a one day high risk trade. Based on momentum I believed that RUT was heading down that day but that is not the real reason I entered the trade. I was looking for a hedge trade to bring in premium to offset moves against some of my Iron Condors.

I bought the $1245 Calls and sold the $1235 Calls that both expired at the end of the day. I was able to bring in about $.30 in premium. During the day RUT started to move against me some and I decided to close two of the contracts giving up a little bit of premium. If the market had continued up I would have continued to scale out of the position but fortunately it leveled out.

When the remaining open positions expired I had made $250.00 on a risk of $9,750.00 or 2.5% in less than eight hours to help offset some of my Iron Condor problems on other trades. I really took to much risk on this trade even though it worked out.

Date	Sym	Action	Exp	Strike	Price	Cont	Type	Cost	Balance
08/05/16	RUT	BTO	8WK1	1245	-$0.05	10	Call	-$50.00	-$50.00
08/05/16	RUT	STO	8WK1	1235	$0.35	10	Call	$350.00	$300.00
08/05/16	RUT	BTC	8WK1	1235	-$0.27	2	Call	-$54.00	$246.00
08/05/16	RUT	STC	8WK1	1245	$0.02	2	Call	$4.00	$250.00