While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to the six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three-day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points.
Today, I would like to make an adjustment to the DVA strangle.
DVA has moved up a bit since I recommended the position.
And the strangle was structured with a bearish bias.
I am not going to suggest you close the call side, instead I am going to suggest you turn it into a debit spread.
Here is how you do it.
Sell to Open (1) November 15th - $60 call for every November $57.50 call you own.
You should be able to sell them for $1.95.
The net affect is that you will put $15 per contract in your account with the potential to earn an additional $250 per contract if DVA moves above $60 by November 15th.
