The decision to close at .05 or .08 is really a judgement call. The ideal situation is to close at .05 or less, but someone with a larger contract size might decide with about 26 days left to expiration it is not worth sweating over .03 cents, they rather take the up side risk off the table. Mind you, in about 5 days you have made over 89% of the potential profit, that is a huge return on an annualized basis. Most members are out of the trade at .05 and you should be able to get out even today at .05 or less.
So to be sure on your jargon again if the closing of this vertical costs more than 0.05 (about 0.08 at market close) then hold the positions?
ReplyDeletefoolistrader-
ReplyDeleteThe decision to close at .05 or .08 is really a judgement call. The ideal situation is to close at .05 or less, but someone with a larger contract size might decide with about 26 days left to expiration it is not worth sweating over .03 cents, they rather take the up side risk off the table. Mind you, in about 5 days you have made over 89% of the potential profit, that is a huge return on an annualized basis.
Most members are out of the trade at .05 and you should be able to get out even today at .05 or less.