Zaki Capital

Tag: Trading

  • Social media ceasefire, VIX and portfolio

    Some social media posts can meaningfully move the markets, especially when the president of USA publishes a potential ceasefire post. Here’s how the Qs (QQQ) moved on a 1 min time-frame, it was about a +3.5% spike. Most of the move materialized in just 5 price bars of 1-min.

    Same QQQ chart over a 5min time-frame. Nice flagging pattern (digestion) after a large up move.

    Prior to the ceasefire post, the markets had gapped down overnight with the VIX hitting 30 on its second spike (first major spike on 9 March overnight with a high of 35, chart below). Reacting to the presidential post, VIX made an intraday low of about 20 (a -32% move) before reversing again in search of some equilibrium in this epic madness.

    Given this context of market volatility, the portfolio I manage has remained rather resilient, clocking new YTD highs in equity value (up +7% YTD vs -4.8% QQQ).

    Why is that so? Some observations:

    • Small position size of mainly short puts (high IV helps harvesting of fat option premiums), max commitment of about 50% portfolio cash.
    • Low delta strike selection with weekly or 2 week expirations.
    • Sold stocks (assigned last Friday) in pre-market after the “ceasefire” news broke out, booking tactical gains. This can be attributed to luck.
    • Shorting puts on intraday lows and taking profits on up swings (range bound/flagging market). Tiny day trades on TQQQ.

  • Trading PnL Status

    Today (17 March 2026), S&P500 index continued its bounce from the Friday’s low close. SPY is still down by 1.8% year to date (YTD) as of writing this. The market has been mostly range bound with some recent lows on the back of geopolitical conflict in the middle east, with an immediate affect on energy prices & global shipping.

    The Volatility Index (VIX) hit an intraday high of 35 on March 9 before reversing, without any significant second spike so far, and closing around the 22 mark today.

    Given this market context, the portfolio I manage has been ticking higher with close to +6% gains YTD and about +39% gains in the last one year compared to +25% gains in QQQ and +18% in SPY.

    Some potential reasons for the out-performance of the portfolio could be attributed to:

    • Range bound market is conducive to writing/short-selling option contracts.
    • High Implied Volatility means higher option premiums to harvest, particularly shorting puts.
    • Smaller position size with higher delta for strike selection, mostly just 50% portfolio commitment, at max 70%.
    • Trading weekly option expiration, provides highest IV.
    • Diversifying trades across time-frames with tactical profit taking.
    • And perhaps the most important component – luck.

    Once the markets rally with a continued upward trend, the same strategy will underperform the market, hence it is important to adjust the trading strategy according to the market mood.