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VIX 16 to 21 Strategy . . .

corneliussmurphy 0

The VIX or more specifically $VIX.X is the ticker symbol for the Chicago Board Options Exchange’s or CBOE Volatility Index based on S&P 500 index options. I’ve watched it closely over the past several months and I have noticed that it has crossed 16 as well as 21 multiple times. Today, I got one right . . . having acquired 10 contracts of the July 21, 2021 CALLs with a strike price of 25 as high as $.63 and as low as $.20 selling them all at $.85. With this transaction I cleared 214% but more importantly learned a couple of valuable lessons!

  • Study before you LEAP (excuse the pun) is much like doing your homework before a test in grammar school. It can’t hurt and is likely to improve your test scores.
  • Greed is the enemy. Sure, I more than doubled my money, but I left lots of money on the table and could have scored a 4X and this is key as greed can make you miss the boat. Therefore, pick a place to buy and a place to sell before you invest and not being too greedy will end up being your friend.

UPDATE . . . I’ve repeated this strategy two more times and am now three-for-three and here are the details.

TRADE #2 – August 11, 2021 acquired 3 contracts of the VIX September 15 CALLS Strike Price 25 for $1.70 and sold them on August 19th for $2.30 clearing 133%.

TRADE #3 – September 2, 2021 acquired 10 contracts of the VIX September 29 CALLS Strike Price 25 for $1.18 and sold them on September 20th for $2.20 clearing 183%.