XOP Finally Profits ... But SPY Counters It

Finally was able to take off the XOP position today around 11:20am. The bid/ask got so wide ... at the open it was -0.13 bid and 0.97 ask! But it got filled two hours later. I had had enough trying to constantly adjust my limit with such a wide spread that I just put in a 0.42 limit GTC (good-till-cancelled). Realized a 0.43 profit on that one, which is pretty good! Other than some issues closing the thing, this trade went perfectly.

Now, on to the loser.

Today SPY is up better than 3.5 points as of writing. I certainly know why. Fed. It's the Fed. I was nervous about originating this position in the first place. If you can remember, I was contemplating getting long the market instead of neutral. 

SPY has been rallying non-stop through the middle of the day on what appears to be low volume. Nevertheless, I anticipate we will see a test of 197.60 by day's end. It looks like we're going to have to make an adjustment to the position. I had to do this last September as well. Twice.

The mark of the position is currently around 0.98-1.00, so down about 0.35-0.37. I'm getting demolished! The put spread of the condor is trading for next to nothing, might as well bank that one.

What I plan to do is roll up that put spread to the -0.30 delta puts, wherever that may be. That will probably take in a credit of around 0.70-0.80. Here's a risk profile to put it in perspective:

Either way it's only 12:45pm and any new adjustment should be treated like a new position i.e. traded on the close. I'm not going to roll at the highs of the day!

Doing so does two things: It reduces maximum risk and, if SPY falls a bit, makes a larger profit / loses less than if the original position were left on. Once the trade is deemed a loser, reducing losses is absolutely paramount!