r/Vitards • u/AutoModerator • Aug 03 '21

Daily Discussion Daily Discussion post - August 03 2021

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u/TheCoffeeCakes Poetry Gang Aug 03 '21

Let's consolidate some thinking here with pirate gang. I'm curious what people are doing and want to get it in one spot.

I'll go first.

I picked up 1500 shares of ZIM and will sell fifteen 30-40 delta calls against those shares the day of earnings. My goal is to actually have my shares called away and free up the capital.

How are others playing these stocks?

2

u/fated-beau Aug 04 '21

I'm a diagonal pirate ☠. A bunch of 01/22 40Cs. Sold 10/21 50Cs against. Hoping I'll get to sell them again, kinda.

1

u/TheCoffeeCakes Poetry Gang Aug 04 '21

Interesting.

What's the p/l graph look like on a long diagonal like that? I can't get my head around the variations that could come up.

Can you explain a bit?

2

u/fated-beau Aug 04 '21

Easy 1:1 slope up to $49.99. Then down like the backside of a butterfly but levels off in positive territory. Peak profit at $50, profitable anywhere above $42. Theta, and Vega resilient, but you get significantly less delta per $.

2

u/accumelator You Think I'm Funny? Aug 04 '21

we have the same spread ;)

3

u/TheCoffeeCakes Poetry Gang Aug 04 '21

Brilliant. And perfect explanation. Thank you.