Today I'll share some of my thoughts as I look at my current portfolio (mostly June with a some July RUT spreads). Another expiration has passed and it's time to consider new positions.
August RUT options will begin trading today, but I think I'll pass. Right now I'm not anxious to sell call or put spreads when IV is so much lower than it has been in recent times. These spreads are short vega, and if I'm going to take a 90-day position and sell vega that expires in August, I need better prices that I anticipate will be available.
I have no idea if IV will move higher over the near term, but it feels safer to add to my July positions, if I decide to do anything new.
There's one decision to be made in the coming weeks. Because I own so much protection, am I still willing to cover those OTM call and put spreads when they reach my 'one penny per trading day remaining' threshold? There's no need to cover for risk management, but it's still an inexpensive method for giving myself a chance to have a big win if that unexpected market event occurs. I plan to compromise. I want to repurchase those spreads, but I'll hold out for a better price.
Good trading to everyone and may this be a winning expiration for all!