With SPX at 2398
Buy 1 Jun 16 2430 Put Sell 1 Jun 2 2400 Put. 27.60 Debit
Greeks: Deltas -15, Gamma -.29, Theta 5, Vega 32, Margin or Risk $2760
5 Step Trade Plan:
#1 Why am I doing this? Market near All time highs and hedging IRA or individual trades to the downside.
#2 Set up: I am Buying my Long Put Option in SPX about 30 points in-the-money and selling my Short Put option about at-the-money. I have no risk on the downside.
#3 Risk Management: Profit Target about 7-10% of initial debit. Max Loss is about 10% of initial Debit.
#4 When to Adjust on Upside? If SPX hits 2410-2415 area
#5 How to Adjust on Upside? Buy 1 2400 P and Sell 1 2410 P (Put Vertical). If SPX continue up, Buy 2410 P and Sell 2420 P. (All Adjustments in the June 2 Expiration).