Options Expiration

Options expiration is this week, so I am expecting at least a few days of increased volatility as people scramble to get in/out of their respective short and long positions. I am looking to sit on the sidelines unless something falls directly into my wheelhouse. I still have my Jun 53 put position in the qqqq's and feel there is some more downward pricing to follow. The Feb 30 calls on the VIX have large volume, so why buck the trend that seems to be presenting itself.

Options Expiration

As the mantra in my blog states, "lessons learned good and bad," Tomorrow I have a bunch of put options that are going to expire worthless because I was over zealous with my purchases. I fell into the classic trap of buying "out of the money" puts because they were cheaper when compared with their "in the money" counterparts. One thing to always remember, when you are a buyer of puts/calls time is your ENEMY and conversely when you are a seller of puts/calls time is on your side and you want that option to expire worthless, so you can pocket that premium and then turn around and sell another option against the same 100 shares of stock. I actually find myself in this situation because back in Nov I sold a Dec 25 call on VDSI for $1.20, so looking at the price right now it is likely to expire worthless tomorrow. I am also currently contemplating selling some covered calls against my position in RIO.