3 replies to this topic

[traderx]

I am thinking of buying qqq and putting on a hedge, because of low VIX.

Any comments on this and what hedge to use appreciated.

[cycletimer]

Yesterday (Friday) I sold a March call credit spread on the $SPX.  It's a hedge yet it's not a purchase of premium, I sold premium for a credit.  It is out-of-the-money (1825 calls) so it allows for a little more room to the upside as I can't nail the exact top tick, and the expiration is March 15th which will allow me time for this trade to work out.  It is a hedge that works because time decay of the calls is on my side.  You might consider this strategy versus buying put premium.  The premium decay is murderous if you plan to hold the puts for any length of time, unless you go way out in Expiration, (like October or November, but then all you're doing is paying premium for the excess time.

[traderx]

Your idea seem good except selling calls now while VIX is low means lower return than normal.

I am leaning towards selling Nasdaq mini futures.

[Waver]

The VIX is low but lets face it, the VIX can stay this low and lower for a long time. Those higher spikes are more rare than not.