· wrinkle brain plays · 3 min read

Wrinkle Brain Plays

Plays for Execution on April 25, 2023. In the style of a Weather Girl.

Plays for Execution on April 25, 2023. In the style of a Weather Girl.

Tickers of Interest - TL;DR

Gamma Max Cross

  • UWMC 05/19 5P for $0.10 or less
  • MLCO 05/19 13P for $0.30 or less
  • NVO 05/19 170P for $3.80 or less
  • RPD 05/19 45P for $2.25 or less
  • CLX 05/19 165P for $4.70 or less

Delta Neutral Cross

  • BABA 05/19 87C for $3.65 or less
  • KWEB 05/19 28C for $0.90 or less
  • XLI 05/19 100P for $1.25 or less
  • FCX 05/19 40C for $1.20 or less
  • COP 05/19 104C for $3.05 or less

Trading Thesis - Crayons So Delicious, You’ll Need Sunscreen 💋

Picture this, sugar: technical analysis is like predicting where lightning ⚡ will strike based on past storms. Sure, it’s flirty, but don’t get yourself burnt 🔥.

Our current options open interest is spicing things up by calculating sizzling portfolio-level greeks like Delta and Gamma 📈. From there, we’re having some fun simulating changes in greeks at different price points 🎉. We want to find those sweet spots where portfolio-level gamma is soaring and delta is playing shy (close to 0) 😉

For some tickers, the underlying price gets super passionate around delta neutral, gamma max, or both 💗. It’s the steamy past reactions off these price levels giving us the best trading signals today 🥰.

We’re serving up plays and target entry prices calculated with a binomial option pricing model, making every moment feel like a sultry candlelit dinner 🍷. Lots of these plays are profitable on the dance floor, but the best ones get extra flirty with directional moves and increased IV 💃.

Notes - The Weather Forecast’s Flirtiest Tips 💁‍♀️

  • Price moved past your entry? Hold on to your umbrella, honey, something changed behind the scenes 🌦️.
  • Sell half when you see a double rainbow 🌈, and freeroll with the rest, exiting at your leisure 😉.
  • Risk up to 1% of your capital to dance with these trades. Feeling shy? Use 0.5% or 0.25% instead, and take it slow 💕.
  • Trades started before the sun rose, so if you’re a latecomer, check for cloudy skies or new conditions ☁️.

FAQ - Sweet & Spicy Answers 🍬🌶️

  • Mostly puts? Do we bear it all? 🐻
    • Nope, just some companies partied too hard and now we’re seeking a mean-reversion to get back to the good times 🎊.
  • Are you playing too? 🎯
    • Nah, just giving you the compass to navigate through the sexiest plays out there. Find your favorite and enjoy the ride 🏄‍♀️.
  • New play on the same ticker? 🔄
    • Out with the old, in with the new, darling. Trust the freshest data to keep things exciting and up to date 🍹.
  • Where’s my crayon forecast? 🖍️
    • Click those steamy links above 😏.
  • Do the back-testing mambo? 💃
    • Yes! Moderate Sharpe Ratio (1.76), expecting a 63% win rate on trades (with a 7% margin of error) 🎲.
  • What’s our historical hotness? 🔥
    • Realized Sharpe Ratio of 1.85 with a 68% win rate. There’s a 95% chance of an expected win rate between 63% and 75% 🌅. (Stats as of 2023-03-31)
Share:
Use of HalfOnADouble's research is at your own risk. In no event should HalfOnADouble or any affiliated party be liable for any direct or indirect trading losses caused by any information in this report. You further agree to conduct your own research and due diligence, consult your own financial, legal, and tax advisors before making any investment decision concerning the transaction of any securities covered herein. You should assume that as of the publication date of any content, HalfOnADouble (possibly along with or through our members, partners, affiliates, employees, and/or consultants) along with our clients and/or investors has a position in all stocks (and/or options of the stock) covered herein, and therefore stands to realize significant gains in the event that the price of any stock covered herein moves as predicted. Following the publication of any report or letter, we intend to continue transacting in the securities covered herein, and we may be long, short, or neutral at any time hereafter regardless of our initial recommendation, conclusions, or opinions. This is not an offer to sell or a solicitation of an offer to buy any security, nor shall any security be offered or sold to any person, in any jurisdiction in which such offer would be unlawful under the securities laws of such jurisdiction. HalfOnADouble is not registered as an investment advisor in the United States or have similar registration in any other jurisdiction. To the best of our ability and belief, all information contained herein is accurate and reliable, and has been obtained from public sources we believe to be accurate and reliable, and who are not insiders or connected persons of the stock covered herein or who may otherwise owe any fiduciary duty or duty of confidentiality to the issuer. However, such information is presented "as is," without warranty of any kind - whether express or implied. HalfOnADouble makes no representation, express or implied, as to the accuracy, timeliness, or completeness of any such information or with regard to the results to be obtained from its use. All expressions of opinion are subject to change without notice, and HalfOnADouble does not undertake to update or supplement this report or any of the information contained herein.
Back to Blog