With my assumption of an oversold bounce here, and with options expiration this Friday I am getting ride of my August 90 puts while they still have a modicum of value,. They actually exploded up 90% yesterday (off a tiny base of course) [Jul 20: Bookkeeping - Buying Some August 90 SPY Puts (SWGTL)] but options have very heavy time decay as you get closer to the day they die, so unless we have a swan dive today or tomorrow I don't see them advancing much from here. I actually should of sold these 3:59 PM yesterday but I did not realize they actually had advanced in value so much yesterday... since S&P 900 (equivalent to SPY 90) is so far away I thought they would be dead money.
Again to repeat these long term put options are insurance policies; when I bought them I had almost no short exposure and since then the market went on a 5 week run of straight up they just withered on a vine. So effectively we paid for the insurance but got no benefit. Contrast that to the same strategy of a new batch we bought last Wednesday which already have paid off nicely. Some months the insurance pays off, some they do not but they allow us to have a leveraged short exposure, risking a set piece of money and not having to mess as much with the highly flawed 2x, 3x inverse ETFs. In this case we lost about $32K which when I bought them was about 3% of the portfolio and now is about 2.4%.
I bought these for $1.13 in mid July, and they are being sold here at about $0.05 for a hearty 96% loss. But $1200 is better than $0 which will be their fate on Friday barring a China like drop Wed-Fri. This will leave us only with the October 95s (puts) we bought last week as our long term short exposure. (recall we took 20% of that position off the table yesterday for a hefty profit, since they rallied 50% in 1 day and SPY filled its gap at 98 - I hope to rebuy that 20% exposure if the market rallies in the next day or two as I want my insurance fund full up)
No position in August 90 SPY Puts