That Was The FTSE Week Ending 25 August

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FTSE – Tight  Range.( up 75 ) Daily Volatility Down from 12.85- 10.89 this Week

The week’s action was muted, after FTSE options expiry. No fireworks,sadly.

FTSE cash index-  open 7324 close 7401 high 7439 low 7296  Last week  ( open 7310   close 7324 high 7445 low 7302)

FTSE volatility-   open 12.85 close 10.89   (last week open 9.36 close 13.93 )

What Trades Would Have Done well

Selling puts : the 6900 Sept puts. They were 20 last week, with FTSE at 7324 (about 6% out of the money) and now they are 5.5. Sometimes KISS– ‘keep it simple stupid’ works quite well.I’m not an advocate of selling naked but many people rely on puts being overpriced to generate regular income. Calls? Well you’d be mildly unhappy-they went from  12.5  last Friday to 14.5. The strangle (selling calls and puts ) thus was 32.5, now 20.

Market Volatility

From  14.07 to 9.82     ( last week6.98 to 16.29)   Options volatility was not dramatic, I was not drawn to trade what I was hoping for. Traders will note volumes are tiny at this time of year. Speculators seem to have  learned lessons from the past. I  always respect this: August and September are the only two months to average a stock decline since 1980, according to LPL Financial.(quote from CNN)

News

The Trump circus produces more crazy stuff, This is now on repeat. Again! And ……..again. Every week.No market moving news- Jackson Hole sees the usual tip toe-ing around lest they upset anyone.

Summary

Provident,(PFG)  the doorstep lender saw its stock in August go from a high of 2,145 to low of 597.5 and thence to 916. The Bank of England ‘gifted’ £72 billion to the high street lenders for credit card and other unsecured lending. Our leaders  are still displaying the mad dash for growth based on a fiat currency.