As a reminder, both subscribers and non-subscribers were invited to submit an article for possible publication in Expiring Monthly.

The winner is Simon Germantis, and his autobiographical story on how he came to be professional trader is included in the August 2010 issue of Expiring Monthly.  Simon also win’s a one year subscription to Barron’s

The runner-up, and winner of a one year subscription to Expiring Monthly is Bill Burton, a retired physician.  He story is also autobiographical in that he tells about trading lessons that he learned the hard way.

Thanks to all who entered.

Winners:

VXX closing price is 27.37

Subscriber who guessed 27.50 is ‘thiru’

Non-subscriber, who guessed 27.23: Roger S

Contest:  Subscriber and non-subscriber whose guess is nearest the closing price of VXX on Friday, July 16, 2010 each wins a prize.  In case of ties, the earlier entry wins.

As we wait for the final numbers, here are data from the contest – allowing entrants to have a better idea of their chances.

Average:    29.25

Median:    28.90

High:         38.16

Low:          21.25

Current price, Jul 2 two weeks before Jul 16:  29.99

Current price, Jul 9 one week to go:                 25.55

Prizes:

Non subscriber:  One year subscription to Expiring Monthly

Subscriber: Three month subscription to “Volatility Essentials” donated by the folks at IVolatility.com

As a sincere thank you to subscribers, we are running a contest and offering a valuable prize to one lucky subscriber.

Non-subscribers also are encouraged to enter. It’s a separate contest and the winner receives a one-year paid subscription to Expiring Monthly.

It’s easy to enter.

1) Send an e-mail to: VXX@expiringmonthly.com.

2) Include your prediction for the Jul 16, 2010 closing price for VXX, the iPath S&P 500 VIX Short-Term Futures ETN.

Entry deadline: Midnight (CT) Saturday, Jul 3, 2010

Prizes awarded to the subscriber and non-subscriber who are nearest to the closing price. In case of ties, the earliest entry wins.

The winner is determined by distance from the correct answer. It does not matter whether your guess is over or under the actual closing price.

The Prize: IVolatility.com is generously offering a three-month subscription to the ‘Volatility Essentials’ Package. Retail value $96.80 per month (although occasionally they do make special offers, such as the one advertised in this month’s Expiring Monthly).

Six of their most popular analytical and management tools are combined into a new convenient package called “Volatility Essentials.”

The subscription combines data and analysis tools in a single package, increasing the probability of making the best available trade.

“Everything needed to run an option portfolio like a professional”

Included are:

• Vol ranker: quickly find equities with cheap/expensive options

• All important pricing data plus the “Greeks”, skew and volatility surface data

• Live P/L calculator. Automatically updates data for multi- variable risk profiles and simulation analysis

• Maintain updated portfolio with prices, volatility and correlation data

• Historical volatility data, put call ratios, volume, open interest, and volatility charts going back as far as 10 years
• Live calculator automatically updates prices and “Greeks”

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A little information about VXX

The iPath S&P 500 VIX Short-Term Futures ETN, VXX began trading Jan 9, 2009. As Bill Luby reports at VIX and More, this product was a hit from its first day, and trading volume has been expanding steadily. The unfortunate news is that most who bought this vehicle (as a long-term investment) were far too early. VXX declined steadily from the beginning. Until one day, it reversed direction

Weekly chart of VXX, since inception (StockCharts.com)

VXX is not designed for investors. It’s a short-term trading vehicle because it is re-balanced daily to keep the portfolio invested in futures with an average expiration 30 days in the future. That involves daily trading expenses and slippage.

iPath, the company that manages VXX, tries to explain the important details. The sad fact is that too many individual traders buy and sell this item without understanding what they are trading. That’s nothing new, as it has been a way of life for VIX option traders. (VIX options DO NOT track the daily VIX – they are options on VIX futures contracts.

Join the fun.

Enter the contest.

Thank you for subscribing.

Adam, Bill, Jared, and the two Marks

Steven Sears, author of The Striking Price at Barron’s, offered a nice mention of Expiring Monthly.  If you are not familiar with this column, you should be.  It’s an excellent daily column related to options.

In the May issue we will discuss the CBOE Benchmark Indexes

We will also have an interview with Dr Brett Steenbarger, commentary on the current state of the markets, and much much more.  If you aren’t a subscriber, why not?  If you are, get ready for a great issue.  This months has upgraded graphics and design as well!

In a recent contest, Jared’s ‘Predicting Stock Returns with Implied Volatility’ was chosen as the article that participants would most like to read.

Here’s that article with our thanks for voting.

In this months issue our experts will delve into the world of skew.

We will also have a great interview with noted educator Jim Bittman, Jared will explore the power of commodity options, and in our first in a series of Pro/Con pieces Mark Wolfinger and Jared Woodard will go at it over whether it makes sense to pay for an options education.  This is on top of our regular salvo of great columns.  Aren’t a subscriber yet???  Subscribe here:  Subscribe

Here is a look at the Table of Contents: