A general strategy discussion but using this AMD trade as an example. I set up a bearish diagonal on AMD with the long after the earnings, short on 7/17. Theory was the long should retain it's IV, and the short has potential to crush since IVR is very high right now.
Adjusted it into a calendar when underlying went up. Then with the recent market swoon it came back to break even but that short IV wasn't budging so the P/L was almost flat. Now it's ripping again...
https://preview.redd.it/wa4s4ojgkv6h1.png?width=1547&format=png&auto=webp&s=89a2a26eb8708f6decd65381e3e96aaca7685836
What would you do? Adjust it, leave it alone since vol is high with 35 days left, or close it?
My adjustment ideas...
1. roll the short put again...but the spread was huge but theotetically my delta would be neutralized...
https://preview.redd.it/4oi03zfikv6h1.png?width=1547&format=png&auto=webp&s=b4c9863064dbb5e185471a8a30cc5d4028c13884
2. add an upside broken wing butterfly, but the max loss goes up...
https://preview.redd.it/wschrsvmkv6h1.png?width=1487&format=png&auto=webp&s=2caaff72ba5bc2ee6ead511e6f429a6e56a9ffe3