That Was The Week
More of the same as we stiffen our resolve against the endless disruptions from the White House. However the great misstep from that camp was the film Melania. The world is mocking the almost total absence of ticket sales. Maybe Trump fans do not live in a town that has a cinema. Perhaps it’s a real litmus test of the popularity of the current ‘administration’. Epstein Files? More whitewash from the White House. However even the pending treason and insurrection and election fraud cases will likely be consigned to the ‘dumpster’ of history. So, we have to ignore the political landscape and address the coming tidal wave of cash rumoured to be forthcoming in the US. Does the silver* frenzy presage the FTSE action?
Carry On Banking
So, in a ‘told you so’ moment, Deutsche Bank has yet again been accused of money laundering.https://www.bbc.co.uk/news/articles/cx20199qzj9o
The once noble institution’s slide into sleaze is well documented in David Enrich’s book: ‘The Dark Towers’. However the book is mainly focussed on the Russian ‘loans’ to Trump via the German bank. We didn’t watch inauguration 1.0 but DB’s maverick Russian loans officer was a Trump VIP in 2017. We know that is a matter of fact. I personally find the whole money laundering game repugnant, as good people do not need to launder money. So, while on the soapbox, I’m of the generation that once held banks in high esteem as trustworthy institutions. And bias is hard to keep in check. I now assume everyone is ‘at it’. However, we need to keep our own moral compass true, to keep sane. Because it’s hard work being dishonest.
*Silver has been a roller coaster in extremis.
451 in Farenheit…….
A sci-fi book by Ray Bradbury, Fahrenheit 451 whereby firemen burn books which are deemed illegal. So, as truth is no longer a noble estate, like Orwell’s 1984, this is remarkably prescient in these dark times! Fahrenheit 451, by the way, is the flashpoint of paper. I recall this as a film for UK tv.
In the Inbox
CBOE deliver the verdict on2025 https://go.cboe.com/l/77532/2026-01-21/fpqjvg/77532/1769026508Nz4n6Ku3/2025_Year_in_Review.pdf
As always, good clean data, they have no need to be creative accountants.
Larry McMillan flaunts his Substack! https://optionstrategist.substack.com/p/trading-systems-and-other-useful?r=p9k8q&utm_campaign=post%2Ca56b33bd30-EMAIL_CAMPAIGN_2026_01_27_06_32&utm_medium=web%2Cemail&utm_source=Email%20Updater&utm_term=0_-a56b33bd30-%5BLIST_EMAIL_ID%5D&mc_cid=a56b33bd30&mc_eid=5f15d5ff5d&triedRedirect=true
I expect some news from ICE.com soon about new products. I will post here once confirmed in a press release.
Distraction Trades- Including New Asset ‘Silver’
ADA was $0.3602 now $0.3105
XRP was $1.9233 now $1.6944 it’s been $3.5 at its highest but how do we value a crypto?
DAX : Missed 500, Thursday’s entry signal occurred before 08:00.Grrrr 3 no entries one Win, 1 loser Nett 60 Rules are rules
UK Gilts Were £16.04 now£16.03 This is based on the Vanguard ETF.
Silver: Using Wisdom Tree Physical Silver(PHAG) was $91.87 Now $85.81 Last week I said:
Some massive moves as Comex tried to keep the price down.
I of course cashed out at $86.64 not feeling the love.OK I did very well but running profits on what seems to be an absurd run up was too much for me. Good luck to all who stick it out
Legacy Trades to 451
Trade 424 High Roller
PRECIS: We start from a losing trade as below. Short calls are rarely a good idea.This is a ratio spread 8450/8650 calls
Rolling to December gives us 53 This was the average from 19-21 Nov. So our cumulative credit from Aug now 319 or from Oct, 147.5. We are in debit of 737 ( 1,125 minus 931×2 )
Was : 8450 call 1207, 8650 calls 1007.5×2 now 808 –our next roll should see us take in 35 or more
Rolling gave us 33 but now the real horror ….. 8450c1479, 8650c 1281 x2 = 1083
In summary we have taken in 266 (legacy 147.5) and our rolling has given us 86 We’re a long way from home!
Was 8450call 1460 and 8650call 1265.5 x2= 2531 Gives us: 1071
Was 8450call 1521.5, 8650call 1322.5 (x2) gives us 1123.5
Ouch! 1684, 1484( x2)= 1284
Last week we rolled on Thursday of expiry week : Jan prices: 1795, 1595×2= 1395, Feb prices: 1812,1613.5×2= 1415 so, we sold the Feb position and bought back the Jan for Credit 20
In summary we have taken in 286 (legacy 167.5) and our rolling has given us 106 We’re a very long way from home!
This week 8450c 1689.5, 8650c1491.5 x2 = 1293 It’s possible this could run for a very long time and it eats margin, but the rolling Credits may well produce 10-20% p.a.
Double Ouch! 1755.5 and 1557.5×2= 1359 Of course the FTSE’s up again so it’s to be expected. We’re only concerned with rolling to the next month until the market meets us.
Trade448, Jade Lizard Time? Feb expiry
Buy 10200 Call 122.5 and sell the 10250 Call 99.5. Sell 9750 put 40.5. Tasty Trade aficionados will know that we sell the call spread and a naked put. Here we have more credit than the upside risk of 50, the width of the call spread. In fact the premium we take in is 63.5, we thus have risk only at 9686.5. So we don’t mind a 400 point dip, a rise but at best we’d want the market just below 10,200
Those prices: 159.5, 136.5, and 31 which gives us 23+31= 64. Our credit was 63.5 so….. we’re in with a shout
The call spread: 92.5, 70= 22.5 and 33.5 for the 9750 put so that gives us 56. We took in 63.5 and there’s 4 weeks to go.
123.5 and 96=27.5, and the put is 31.5 gives us 59.
Trade 449 It’s Gotta Be Puts, and A Calendar
Struggling to find trades with modest risk/reward, so what we have here is a February short (sold) 9700 put for 28, and a March spread that we buy 9850put 84, sell the 9650 put 57.5, so we pay 26.5 for the March put spread. Giving us a tiny 1.5 credit. We now have risk at about 9500 and no upside risk. We may live to regret this, after a year of ridiculous buying ( IMHO).
short Feb 9700 put 29.5 Long March put spread 95.5 and 63 =32.5 We’re in credit 3 !
This week: Feb 9700 put 27.5, March9850/9650 put spread 89.5 and 62= 27.5 We’re no longer(aside from 1.5 at entry) in credit
Trade 450 Classic Index Trade ….Strangle
10500 call 13.5 9250 put 13.5 For no particular reason, we have equal premium on either side giving us nett credit 27. We have risk at 10527, and 9223 ( 3.8% to the upside and around 10% to the dark side ) Given the precarious nature of everything it seems we need that big 10% buffer zone on the put side.
10500 call 18.5 and 9250 put 12.5 = 31 Hmm not what we hoped for, we took in 27 but it’s still 3 weeks to go, yet.
Trade 451 Struggling to Pick a Strategy
We ladder or ratio into a butterfly. Of sorts. Say what? We buy a put ratio spread buying the 10200 put,118.5, selling 2 of the 10000puts 60.5×2. Then, we buy the 9800 put, 36.5, and sell 2 of the 9500puts 18.5×2. This gives us 2.5 and 0.5 = Credit 3 We stand to make a profit anywhere from 10,200- 9810 and risk at 9500. It’s zero cost low risk possible 200 max profit. So, we have no upside risk, modest profit potential. We cannot have upside risk. But we need some skin in the game. I foresee an accommodating market for the trade. I also have little idea where we go next. Positivity is much needed while all around are doing ok against your own judgement
For those new to options:
https://optionsinvesting.co.uk/special-edition-how-options-work-1/
https://optionsinvesting.co.uk/special-edition-how-options-work-2/
https://optionsinvesting.co.uk/how-options-work-page-3/
Contact: surreyhantstraders@gmail.com.
If there is anything you’d like help with, we all started somewhere and yes, it can be baffling. There are no stupid questions, give it a whirl. (AI gets things wrong, remember)
All opinions expressed here are not to be taken too seriously and all of the trades are for educational purposes only.