Saturday, January 20, 2024

Weird Trades

  Something really weird happened last night.

For some very strange unknown reason, I woke up at 4.30am.

Instinctively I checked my expiring options positions.

I was holding on to several large short put positions that were expiring, most were ITM, which meant I was prepared for them to be assigned and pay up for the underlying shares.

The moment I logged into my account, it showed my margin unearthly high at 95%! I was almost about to get stopped out!

So I quickly did an additional top up without understanding why, and brought that margin down.

Then I stay up until past 5am until the market closed.

I found out that in the last few minutes of expiry, the price of the underlying stock was moving quite rapidly, hence causing the margin for the options to spike. So very, very luckily I could do a very quick top up so shore up my margin %, else I would have been stopped out of ALL my other margined positions as well!

All in, it was an easy 10K profit which could have been a 5K loss had I breached my margin limits.

Phew!

Furthermore, the underlying stock jumped 6% for a Friday session, which also meant some of my sold puts expiring OTM, meaning I earned the premiums and had more liquidity for the next short put play! Super nice!

Looks like 2024 is not turning out to be so bad afterall!

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