During the course of the day when market is open Jay will post thoughts, updates, responses to subscriber questions, and more to this page.

Additionally, buy and sell alerts and adjustment notices will be posted here.

Go ahead and bookmark this. Please note that all dates and times below are eastern time.

August 13, 2024 - 5:59 pm

A week ago Monday, during the monthly Options Insider session, a few of you sold put spreads on USO (when the market was way down). Oil has pretty much gone straight up since then, so it’s probably safe to close that trade at anytime now. Most of the premium has probably vanished at this point. That timing worked out nicely!

July 11, 2024 - 2:15 pm

For those of you who are in the QQQ iron condor, we caught a break today. We were at max loss yesterday (with the trade expiring Friday), but the selloff today means we can close for around a 55-60 cent loss. That’s much easier to digest. Because we have no idea if the market will bounce back tomorrow, I think it makes sense to close here and take the much smaller loss (than yesterday). You can try to close the whole spread (as seen below) but it may be easier to just let the put spread expire and close the call spread separately.

July 9, 2024 - 2:43 pm

For those of you in the NVDA trade, it’s right around a 100% winner, so let’s close it now. I show below how to close the entire broken wing butterfly at once, but you’ll probably find it easier to close the short strikes first (buy to close the 130 calls) and then sell to close the 125 and 133 calls. You can always try to close the entire spread at your desired price (net credit) and if you can’t get filled, close it in parts. Regardless, we have nice profits on the trade and I believe it makes sense to close today.

June 28, 2024 - 2:34 pm

For those of you in the AAL broken wing butterfly, we are in the money, so we need to close the trade (to avoid assignment). We spent about 60 cents on the trade and we can close for around 25 cents. It will near impossible to close the entire trade at once at a reasonable price, so your best bet is to close the 12.5 calls first by buying them back at a penny. Then you can sell the 11 calls for whatever you can get (about 26 cents as I write this).

June 24, 2024 - 2:00 pm

In the live session today we traded a call broken wing butterfly on NVDA. This is a bullish trade that expires in 25 days. The net debit cost is around 85 cents. Trade details and the payout diagram can be found below.

June 3, 2024 - 1:46 pm

In the live session today, we purchased a broken wing call butterfly on AAL. This is a neutral to bullish position on AAL that expires in 25 days. The 11-12.5-13 broken wing fly cost is about 62 cents net debit. Trade details and the payout diagram can be found below.

May 31, 2024 - 2:04 pm

For those in the ABNB trade, it will finish out of the money. No action needed as it will expire for zero. I will be here next Monday, so we’ll add a new trade (but then I’ll be gone the following week). We are overdue for a winner, so let’s find something good!

May 24, 2024 - 2:17 pm

For those holding KWEB and SHOP positions – first off, SHOP will expire OTM so no action is needed. For KWEB, we are actually in the money – not enough to turn a profit, but we will get some of our capital back at least. We need to close KWEB so the 30 puts won’t get exercised. First off, we have to buy back the 28 puts for a penny (or 2 cents if you can’t get filled). Then we can sell out the 30 put for 12-14 cents. The 27 put you can let expire for zero. We just need to make sure the trade is closed by the end of the day today.

May 20, 2024 - 1:50 pm

In the live session today, we traded a broken wing call butterfly on ABNB. We placed the 146-148-149 call BWB for around 54 cents net debit. This is a neutral to bullish trade that expires in about two weeks. Trade details and profit and loss diagram can be found below.

May 13, 2024 - 1:48 pm

In the live session today we bought a bullish broken wing butterfly on SHOP. We placed the two-week (May 24th) 60-63-65 call broken wing fly for around a 50 cent net debit. Trade details and the profit and loss chart can be found below.

May 10, 2024 - 2:13 pm

For those of you in the SNAP trade, the stock finally started to sell off at the end of this week. Unfortunately, it’s too little too late for us as we needed the stock to drop below 15 before the end of today. It will expire for zero so no action is needed.

May 6, 2024 - 2:07 pm

In the live session today, we placed broken wing put butterfly trade on KWEB. It’s a moderately bearish trade that expires in about two weeks. It should cost around 49 cents. The profit/loss graph can be found below along with the trade details.

May 3, 2024 - 3:05 pm

For those of you still in XLV, we are right at the bottom strike so we need to make sure to close before expiration so as not to exercise the long 141 call and own the shares. In this case, it’s highly unlikely the entire spread (seen below) will get filled at a reasonable price. It’s easiest to buy back the short 144 calls for as little as possible (1 or 2 cents) and then sell out the 141 call for whatever you can get. In this case, you can ignore the 145 call and let it expire for zero. Just make sure it closed before the end of the day to avoid exercise.

May 1, 2024 - 2:27 pm

For those of you still in UAL, I think we are in a good spot to close here. I’m showing a credit of around 1.20-1.30. Anything in that range is a nice winner (even if the net credit ends up being closer to a 1.00, it’s still solid gains). Closing details are below. Just remember that you can close the trade in pieces if you can’t get filled all at once (as long as you buy back the short puts first before selling the long puts).

April 29, 2024 - 1:56 pm

In the live session today we bought a put broken wing butterfly on SNAP that expires in two weeks. We placed the 15-14-13.5 put broken wing fly for around 34 cents (net debit). This is a neutral to bearish trade on SNAP. Trade details and the profit/loss graph can be found below.

April 25, 2024 - 5:58 pm

Looks like I made a mistake on the UVXY closing trade. The one I sent out the Monday before last used 38-36.5-35.5 as our strikes (not 38-35.5-34.5). If you ended up doing the version that I sent out (I know there was some variations on what spreads people used) then be sure check your strikes and make sure they match your position. The prices are all crazy wide in the afterhours so it’s bit hard to know what the price is, so just try to use as close to the midpoint tomorrow as possible if you haven’t yet closed the trade.

April 25, 2024 - 3:22 pm

For those of you still in the UVXY trade, it’s in a good spot to close here. I’m showing about 1.50 – 1.60 closing price which is somewhere in the neighborhood of 60% gains. Closing trade details are below (and don’t forget that expiration is tomorrow – so be sure to close the trade). If you are having trouble getting filled, you can close the short strikes first and then the longs.

April 22, 2024 - 1:54 pm

In the live session today we placed a broken wing butterfly on UAL for a net debit of around 57 cents. This is a neutral to bearish position that expires in two weeks. Trade details and the profit/loss graph can be found below.

April 19, 2024 - 2:50 pm

We have SBUX and ROKU expiring today. ROKU got beat up when the market started selling off. SBUX hung in there pretty well, but didn’t quite make it above into our target range. We’ve had a few of these lately that were close but not close enough. Regardless, no action is necessary and you can let both trades expire out of the money.

April 15, 2024 - 2:04 pm

We made two trades today in the live session for Options Insider. First off we placed a put broken wing butterfly on UVXY (1.5x long VIX exposure). This is a two week play that volatility will settle down. We also did a three week call broken wing butterfly on XLV. This is a bullish mean reversion play on the healthcare sector. Both trades and P/L charts can be found below.

April 8, 2024 - 1:49 pm

In the live session today we placed a bullish broken wing butterfly on SBUX for about 48 cents (that expires in two weeks). Trade details and the payout diagram can be found below.

April 5, 2024 - 2:50 pm

For those in the GPS trade, we are so close to the stock dropping into our butterfly range. I don’t think it’s going to make it, but considering how far away we were earlier in the week, it’s amazing it got this far. For now, we can just let it expire for zero (no action needed). If for some reason the market drops during the last hour and this trade becomes in the money, I’ll send out another text with closing instructions.

April 2, 2024 - 10:26 am

For those of you in the FDX trade, the price has dropped into our profit zone. I’m showing about a 1.30 price for the spread, which is roughly a 45% winner. Let’s close here and take the profits. I usually try to close the whole thing at once first (as seen below) and if I can’t get a reasonable closing price, then I’ll close the short strikes first and then the longs.

April 1, 2024 - 1:59 pm

In the live session today we placed a moderately bullish broken wing butterfly on ROKU. It expires in two weeks and costs around 60 cents. Trade details and the payout diagram can be found below.

March 25, 2024 - 2:07 pm

In the live session today, we placed a broken wing butterfly (all puts) on FDX for around 90 cents. It expires on 4/5. We are expecting a bit of mean reversion over the next two weeks. The trade details and profit/loss graph can be found below.

March 22, 2024 - 1:48 pm

Looks like AAPL will close out of the money, so it will expire for zero. I should have closed it on Wednesday when it was a big winner. While Thursday’s news was unexpected, there was no reason to wait when profits were over 100% on Wednesday. (My reasoning at the time was that I didn’t want to rush a trade alert at market close and figured we had plenty of time on Thursday. In hindsight, it looks like a really bad decision.) Hopefully many of you closed early.

I think going forward I’m just going to suggest we always close at 100% or more and you don’t have to wait for my closing alert. Maybe for certain trades that number will be 50%. We can set automatic closing parameters on Monday when we make the trades. I still send closing alert texts, but having exit parameters can help since my timing can be off.

March 21, 2024 - 1:23 pm

AAPL shot up yesterday towards the close and my intention was to take profits today. So of course, today’s the day that the DOJ announces they are suing the company over an iPhone monopoly (causing a 4% drop in the share price). I think the market will brush off the lawsuit in the short-term, so let’s see if we get a rally into close or tomorrow – to the point where we can still close our trade for a profit. Stay tuned.

March 18, 2024 - 2:55 pm

In the live session today, we placed a broken wing put butterfly on GPS. This is roughly a three-week bearish trade on GPS. The trade details and profit/loss scenario can be found below.

March 15, 2024 - 2:31 pm

For those in the SNOW trade, you can let it expire for zero. The opportunity in SNOW melted away very early on and it was never able to accumulate enough higher moves to get near to our strikes. AAPL is down today but is a far more promising trade – and we still have a full week on before expiration. I’ll keep you posted on that position next week.

March 11, 2024 - 2:19 pm

Not sure if anyone is actually getting these texts (issues seem to have cropped up again). If so, this is the broken wing butterfly we placed today in the Insiders live session. It’s a roughly two-week bullish call broken wing fly on AAPL. Trade details can be found below, along with the profit/loss scenario.

March 7, 2024 - 1:11 pm

For those of you holding the TWLO broken wing butterfly, in this case, waiting paid off. The stock is right in the sweet spot with just a day to go before expiration. If we close here, the price should be somewhere around 1.85. That’s roughly a 113% return. Closing details can be found below. Remember you are closing for a credit. Also, if it doesn’t seem that you can get filled at a decent price, you can close in pieces by buying to close the short strike (61) first and then closing the longs (58,62).

March 4, 2024 - 2:05 pm

In the live session today we placed a broken wing butterfly (calls) on SNOW for around 85 cents (it’s currently trading for around 90 cents). It’s a two week bullish trade on the stock. Trade details are below, along with the payout graph.

March 1, 2024 - 12:47 pm

Our broken wing butterfly in NET expires today. It kept flirting with the top strike of our range, but ultimately it has moved out of reach today. We can let this one expire (no action needed). TWLO on the other hand, is in the money. My plan now is to wait until Monday to decide on closing, in order to capture the weekend premium. I’ll keep you posted on closing that trade (but certainly feel free to take profits if you are comfortable with the gains – it’s about a 32% winner last I checked).

February 26, 2024 - 2:39 pm

In the live session today, we bought a broken wing call butterfly on TWLO. Specifically, we purchased the March 8th 58/61 (x2)/62 spread for a net debit of around 90 cents. Trade details and the payoff graph can be found below.

February 20, 2024 - 12:38 pm

We talked yesterday about doing another broken wing butterfly in NET (once the markets opened back up today). NET is down about 3% today, but I still think this trade is a good idea. We’ll adjust the strikes a bit from what we discussed, but the shape of the trade remains roughly the same. We’re sticking with March 10th expiration which is about 10 days away. The net debit for the trade is around 62 cents (give or take a few cents in either direction). Trade details and the what-if chart can be found below.

February 19, 2024 - 1:00 pm

There is an Options Insider webinar today. I won’t send a trade until tomorrow, but we can still talk about strategy during the session. Sorry for the late notice!

February 14, 2024 - 12:45 pm

We have two trades in Insiders ready to be closed. I’m not going to make the same mistake of waiting too long like I did with GDXJ, so let’s take profits off the table in both ABNB and NET. For ABNB, we’re looking at roughly 75% gains. For NET it’s around 30-40% gains. If it doesn’t seem like you can get the entire broken wing butterfly filled at a reasonable closing price, you can try buying back the shorts first and then selling out the longs. Trade details can be found below for both.

February 12, 2024 - 3:03 pm

In the live session today, we traded a bearish broken wing butterfly on NET that expires Feb 23rd. Trade details and the profit/loss diagram can be found below.

February 9, 2024 - 2:42 pm

Let’s update the situation on the three open broken wing butterflies:

GDXJ – I’m an idiot for waiting to close this one. We had a nice winner in it last week and I got greedy. Fortunately, many of you closed it without waiting for me. For those of you who didn’t, my apologies. It’s now worth zero and we’ll just let it expire. That’s 100% on me.
DIS – This one became out of reach after earnings and we’ll just let it expire for zero..
ABNB – It’s a winner right now but we definitely want to let the weekend go by and collect that time decay. We’ll look at closing it early next week (and I’ll try to avoid the mistake I made with GDXJ).

February 8, 2024 - 2:17 pm

Quick update on our 3 open broken wing butterflies:

GDXJ is right on the edge of profitability, so we’ll look at closing tomorrow to give it a chance to move a bit higher
ABNB is within our wings (outer strikes) so is currently set up to be profitable. Earnings and expiration don’t occur until next week so we have some time yet to decide what to do
DIS investing 1.5 billion in Epic Games was totally out of left field and sent the stock soaring. That position we can let expire out of the money tomorrow

February 5, 2024 - 2:50 pm

In the live session today, we placed a bearish broken wing butterfly trade on DIS. Earnings are in a couple days and the trade expires at the end of the week. The price hasn’t moved at all since the live session. Details for the trade can be found below, along with the profit/loss graph for the strategy.

February 2, 2024 - 2:12 pm

For those in the UNH trade, it’s out of the money, so we can just let it expire for zero today. GDXJ and ABNB are both looking good though, and we may close early (next week) to take profits. Stay tuned!

January 29, 2024 - 3:09 pm

In the live session today we made a bearish broken wing butterfly trade on ABNB. Trade details and the payoff graph can be found below. The $ 1.00 net debit price may move around a bit because the markets are wide, and you may need to raise your limit order to get filled.

January 24, 2024 - 12:57 pm

Please ignore that last text – it was meant for Weekly Income Accelerator members.

January 22, 2024 - 2:26 pm

In the live session today we placed a bullish broken wing butterfly in GDXJ. We also closed our AAPL BWB for a profit. Both trades can be found below, along with payout/risk graph for GDXJ.

January 16, 2024 - 2:37 pm

In the live session today we made a bullish broken wing butterfly trade on UNH. The price hasn’t moved that much, so there’s still plenty of time to get in (it should cost 85-90 cents or so – don’t worry about the wide markets because it’s a low volatility stock). Trade details and the payoff graph can be found below.

January 12, 2024 - 2:36 pm

For those in the WBA trade, the stock stayed below 25 so we are locked in with our gains (25%-40% depending on what your purchase price was). Technically we can let the entire broken wing butterfly expire since everything is in the money, but it does look pretty messy in your brokerage when that happens. I prefer to close out the spread in these situations.

Trade details are below. You may need to close out the shorts first (buy to close the 26 puts) and then sell to close the longs (25 and 28 puts). The benefit of breaking it into pieces is you may get a better fill price. Regardless, this trade will be a winner for us.

January 11, 2024 - 3:11 pm

For those in the WBA trade – we’re up about 40% right now, which is the max we can make if the stock stays below 25. However, there’s no risk in holding until tomorrow, and if the stock rallies above 25, we can reach higher profit levels (but if it drops, we’ll still make our 40% or so). In other words, we can wait until tomorrow to close. I’ll send out a text with closing details during the trading day tomorrow.

For AAPL, we’re in the money by a small amount, but there are still a couple weeks left on the trade (so the price hasn’t really moved). We’ll revisit again next week but this trade likely won’t be closed until the following (expiration) week.

January 8, 2024 - 3:09 pm

In the live session today we placed a broken wing butterfly trade on AAPL that expires on the 26th for around 1.50 (it’s trading around 1.60 now). The trade details can be found below along with the profit/loss scenario. This is a moderately bullish position on AAPL. Just remember you can only lose what you pay for the trade since it’s a net debit situation and we are using all calls for this particular trade.

January 2, 2024 - 2:43 pm

In the live session today we placed a broken wing butterfly trade on WBA that expires on the 12th. The trade details can be found below along with the profit/loss scenario. This is a bearish/neutral trade on WBA. Just remember you can only lose what you pay for this trade since it’s a net debit situation. Also remember to use puts instead of calls. I’ll text out updates as to where we stand on this trade over the next two weeks.

December 28, 2023 - 12:40 pm

For those of you in the DOCU trade, let’s go ahead and close it here. It may be a tricky to close the whole thing at once because of the lack of liquidity today. In the trade details below, I used 1.15 as the net credit for closing. However, it probably will be easier to close the short strikes first (the 61 puts) and then close the longs (60 and 63). In that case you would buy to close the 61 puts and then sell to close the 60 and 63 (also probably easier to do in separate trades). You can always start by trying to close the whole spread for around 1.15 and see if the order will get filled before dividing the trade closing process into pieces.

Regardless, we should end up with a 40%-50% gain on this trade when all is said and done.

December 18, 2023 - 2:11 pm

In the live session today we placed a broken wing butterfly trade on DOCU that expires on the 29th. The trade details are below along with the profit/loss scenario. If you get close to midmarket price on this trade, there should be gains on the downside (despite what the P/L graph shows below). Just remember you can only lose what you pay for this trade since it’s a net debit situation. Also remember to use puts instead of calls. I’ll text out updates as to where we stand on this trade over the next two weeks.

December 13, 2023 - 2:16 pm

For those of you in the SPY call spread, after the FOMC meeting announcement, the stock has jumped over 467 (and above our call spread range). We can close it here for a credit of $ 2.00 (or higher). That’s a solid 79% winner in two days. See below for the closing trade ticket. You should be able to close the whole thing at once for a net credit, but if you decide to close in pieces, close the short strike first and then the long strike.

December 11, 2023 - 2:08 pm

In the live session today, we traded a SPY call spread. It’s a bullish trade that expires in about two weeks. The trade is still priced about where we made it during the session. The trade details and payout graph can be found below. I will send out a closing text if we’re going to close it early (maybe after CPI), and of course I’ll keep everyone posted if we’re going to hold longer (potentially to expiration).

December 8, 2023 - 3:22 pm

It doesn’t look like we’re going to get that GME rally today. For those in the GME broken wing butterfly, you can just let it expire out of the money.

December 8, 2023 - 1:44 pm

For those in the GME trade, we’re about a dollar away from a scenario where we’d need to close the trade. The stock did rally sharply into the close yesterday, so there’s still a chance our broken wing fly could come into play. If that happens, I’ll send out another text. For the time being, if the stock price stays below 17, we can just let our spread expire. I’ll keep you posted.

December 4, 2023 - 2:03 pm

In the live session today, we placed a broken wing butterfly trade on GME. The price hasn’t really moved so this trade is still good for those who want to take part. It’s a bullish play on earnings, which come out on Wednesday, while also taken advantage of how expensive the calls are. The trade expires Friday. Details on the trade entry and profit/loss can be found below. I’ll send out texts during the week for closing/expiration instructions.

December 1, 2023 - 1:23 pm

For those in the CRWD trade, our calendar spread isn’t really worth anything since the stock didn’t drop far enough towards our strike. We still need to close this trade (unless you want to hold the long call for some reason after the short call expires today). It may be difficult to close the spread all at once because it’s essentially worth zero, so your best may be to close each leg separately. In that case, you buy back the short call first and then sell out the long call. The goal is close for a net debit of zero or above. I show the trade details below.

November 29, 2023 - 2:10 pm

For those in the CRWD trade, it looks like the calendar is trading at about 40 cents right now. The stock jumped quite a bit this morning, but we could see some profit taking after that kind of move, before the end of the week. We’ll wait a bit longer before closing the trade to see if the stock pulls back a bit.

November 27, 2023 - 3:02 pm

In the live session today we placed a calendar trade in CRWD. Earnings for CRWD are tomorrow after close so the earliest we will close the trade is Wednesday and latest will be Friday. I’ll send out closing instruction via text. You can only lose what you pay for the trade – the estimated profit/loss graph can be found below. Trade details are below – be sure to make your trade look like the order entry below, especially if you’ve never placed a calendar trade before.

November 24, 2023 - 11:24 am

With an hour and a half until close, it seems highly unlikely that MDT will drop below 78 and into our butterfly range. As such, no action is necessary as the longs and shorts will cancel each other out on exercise/assignment at expiration.

November 22, 2023 - 12:57 pm

MDT is about 50 cents from our butterfly range, so we’ll give until Friday to see if it can fall into that profitable range. Remember, Friday is a half day, so if we end up closing, it will have to be earlier in the day than normal. I’ll be sure to send a text out with instructions.

November 21, 2023 - 12:36 pm

MDT is trading right around 78, which is right on the edge of our butterfly range. We want it to be under 78, preferably as close to 75 as possible. We’ll give it another day to see if it pulls back some. In theory, we could close it on Friday as well, but it’s a short day and liquidity will be more of an issue. Let’s see how it looks tomorrow and we’ll make a decision then.

November 20, 2023 - 2:01 pm

In the live session today, we traded a call butterfly on MDT. Earnings are tomorrow, so we are likely to close the trade tomorrow or Wednesday. Details are below, along with the profit/loss graph. I’ll send out a text tomorrow about what to do for closing.

November 17, 2023 - 2:56 pm

The HD and TGT butterflies will both finish deep in the money. However, the longs will cancel out the shorts, so no action is necessary.

November 15, 2023 - 10:46 am

After focusing primarily on bullish-leaning trades the past several weeks (without a lot of success) we switched to neutral butterflies on both TGT and HD… and of course both stocks skyrocketed higher on earnings. Go figure. On the bright side, we are nearly at max gain on our long ARKK condor, which we can now close. I’ve included the closing details below. You should be able to close for around 1.35 for the call spread. The put spread will expire for zero, so you don’t have to close that part. For TGT and HD, we’ll just sit on those until expiration. They both likely will expire OTM unless the market tanks. If ITM calls get assigned in either TGT or HD, my response is typically to close the remaining long options.

November 14, 2023 - 3:52 pm

We have three open trades this week: HD, TGT, and ARKK.

HD blew past on our strikes on a combination of good earnings results plus the very bullish CPI report. There’s nothing to do for now, but if the market mean reverts by the end of the week, our call butterfly could still potentially be in play. There is some early assignment risk for the moment, but it’s not likely to happen this early in the week (and if it does, the best course of action is to close out the rest of the spread)
ARKK is looking good right now and we could close for a decent winner. We’ll wait another day or two to let those short strikes decay a bit more and see if we can maximize our gains as much as possible.
TGT is also in good shape, but we won’t look at closing until earnings tomorrow when the volatility comes out of the options.

In a nutshell, we may close both TGT and ARKK tomorrow, but HD will probably have no actions until Friday.

November 10, 2023 - 3:28 pm

For those of you who got into the JPM broken wing butterfly back in mid-October, it expires today. It looks like we’re going to fall a couple dollars short of our butterfly range, which means all the legs expire for zero. No action is necessary.

November 6, 2023 - 2:21 pm

In the live session today we bought a short-term iron condor in ARKK. Remember, we are buying the condor this time, so you can only lose what you pay (around 78 cents) and we want ARKK to move either direction by 11/17 expiration. Make sure it looks like the entry screen below (buying the inner strikes, selling the outer strikes). The payout diagram is below, so you can see your risk/reward characteristics. We’ll discuss this trade next Monday and talk about ideas for how to close.

October 30, 2023 - 2:35 pm

In today’s live session we placed a call butterfly in TGT. This is a direction-neutral trade over the next 3 weeks (although, if profitable we’ll look to close after earnings on the 15th). You can see the details below for the November 17th 103-109-115 call butterfly (trading around 1.10). The payoff diagram for the trade can also be seen below.

October 27, 2023 - 3:09 pm

We have two trades expiring today if you’ve been following along with what we’ve been doing during the Monday live sessions. Some of you may have already closed TLT, but if not, it looks like it will expire just out of our butterfly range. You don’t have to do anything (unless we get a furious rally in the next 45 minutes) as whole fly will expire for zero.

For CSCO, the stock also dropped out of our spread range. The short call will expire for zero. The short put spread will expire in the money but the long and short put will cancel each other out on expiration. As such, no action is necessary.

October 20, 2023 - 2:53 pm

For those of you in the SQ trade from a while back, it expires today. The stock is well below where it was at the time of the trade, so no action is necessary as the spread will expire for zero.

October 16, 2023 - 2:13 pm

In today’s live session we placed a broken wing call butterfly in JPM. The trade is moderately bullish over the next 3 weeks. You can see the details below for the November 1oth 148-152.5-155 call butterfly (trading around 1.35). The payoff diagram for the trade can also be seen below.

October 11, 2023 - 3:43 pm

We placed a DKNG call spread (28-29.5) back in late September for around 58 cents. That call spread is now work about 1.20. We still have another week and half to expiration, but at roughly 100% gains, I think it’s worthwhile closing here. Details can be found below, but it may be easier to buy to close the 29.5 call first before selling to close the 28 call. If you don’t see this until after market close, that’s okay, closing tomorrow for around the same price is fine.

October 9, 2023 - 1:53 pm

The trade we made in today’s live session was a call butterfly in TLT. The strategy is moderately bullish on TLT over the next 3 weeks. The trade details and payout diagram can be found below.

October 2, 2023 - 2:11 pm

In the Insiders live session today we didn’t end up making a trade. We did a lot of analysis on TLT, but couldn’t find a suitably priced strategy. We’ll revisit bonds in the near future.

September 25, 2023 - 2:56 pm

In the live Insiders session today, we made a bullish trade on DKNG. We bought the October 20th 28-29.50 call spread for around 58 cents. The trade details and the profit and loss graph can be found below. A reasonable proxy for this trade if you can’t trade spreads in your account is buying the 28 or 28.50 call

September 22, 2023 - 3:03 pm

For those in the ASHR trade – as I suspected, the stock will end up between our two spreads. That means both spreads will expire for zero and no action is necessary. As a reminder, when buying a condor, you can only lose what you spend, which was around 35 cents in this case.

September 21, 2023 - 5:47 pm

For those in the ASHR trade that expires tomorrow, the most likely outcome will be no action. I’ll send out something tomorrow regardless, but we are likely to see the stock end up between our put and call spreads, meaning we can let them both spreads expire for zero. Keep in mind, we bought this condor, so the most that can be lost is the 35 cents or so you paid for the spread. You can ignore any crazy big numbers that are due to the bid/ask spread being really wide on some strikes.

September 18, 2023 - 2:45 pm

Here’s the trade we did today in the Insiders live session. It’s selling a put spread to finance (buy) a call in CSCO. It’s a very bullish trade, but really it’s based on the calls being super cheap (relative to where they’ve been in the past). Because this trade is focused on the calls, it’s okay if you want to skip selling the put spread and just buy the calls. Selling a put spread will require a margin account or a decent reserve of cash in a cash account (if you sell the 55 put first, it would just be a cash secured put and then you could buy the 53 put afterwards).

The trade details are below, along with the profit/loss graph. The expiration isn’t until October 27th. Keep in mind, this trade (with the put spread) will only cost about 25 cents, but max loss is about 225 if CSCO tanks (conversely, upside is unlimited). If you just buy the call, you can only lose what you spend on the call purchase.

Details:

September 15, 2023 - 2:33 pm

Closing Alert:

Both BITO and X are in the money, which means we need to close them in order to avoid exercise. I’ll show closing steps for both below:

BITO didn’t get quite get to the level we wanted, but it’s still in the money, so we’ll close it. You’ll have to do this as two separate transactions because the 15 call has essentially no value (but you can’t close the 13.5 until the 15 call is closed).

Here are the steps:

Buy back the 15 call for a penny
Sell the 13.5 call for whatever it’s worth (about 6 or 7 cents right now)
Once you close the 15 call, you could theoretically hold the 13.5 call to see if it rallies towards close, but then you risk getting nothing for that call if the price drops

I show the X trade as roughly breakeven at this price level. You’ll also need to close it in parts, although you can completely ignore the 35 call.

Here are the steps:

Buy back both 33 calls for a penny (for a total debit of 2 cents)
Sell the 30 call for whatever it’s worth (about 75 cents right now)
Ignore the 35 call
We paid around 75 cents for this trade, so we should be right around that level for the closing price

September 11, 2023 - 2:15 pm

Insiders,

Here’s the trade we made today in the Insiders live session: We are buying the SQ October 20th broken wing call butterfly for around 1.22. We are buying the 55 call, selling two of the 60 calls, and buying one of the 62.5 call, all for a net debit of around 1.22. You can see the details below and the profit/loss graph that shows max gain, max loss, and the profit range at expiration. This is a bullish trade that SQ will rebound over the next 40 days or so. If you can’t make butterfly trades in your account, you can buy a 55-60 call spread or a 57.5-62.5 call spread as a decent proxy.

September 4, 2023 - 10:27 am

Please disregard the previous text message about today’s Options Insiders live trading room. It has been canceled for today. See you next week. Enjoy you Labor Day!

September 1, 2023 - 11:09 am

Insiders,

For those of you who didn’t get assigned on INTC, our broken wing put butterfly is now a winner and can be closed. It took a while to pay off, but on the position’s expiration day, the stock finally climbed into our profit zone. We paid 15-20 cents for the fly and it can be closed for around 1.00. You can try closing the entire spread (as seen below), but more likely you’ll need to close the shorts at the 37 strike first (buy them back) and then close the 39 long put after (sell to close). You can let the 34 strike expire for zero.

Details:

August 28, 2023 - 2:21 pm

Insiders,

Here’s the trade we did in the live session today. It’s buying an iron condor in ASHR that expires on September 22nd. We’re looking for a move in either direction in ASHR over the next 25 days or so (it’s a wide bid/ask spread but your fill price should be around 35 cents realistically). Trade details and the payout graph can be found below. This trade is really just buying two vertical spreads, so any level of spread trading permission should allow you to make this trade in your brokerage account. However, if you don’t have spread trading access, just buying the 25 put and 27 call is a decent proxy for the trade.

Details:

August 25, 2023 - 3:22 pm

Insiders,

For those of you placed the INTC broken wing put butterfly a few weeks back – it sounds like many of you have gotten assigned on INTC shares.

There are basically two choices now (in my opinion):

Close the rest of the options and take what should be a small loss on the position
Keep the shares (or half the shares), sell calls against them and turn it into a covered call trade (and close the remaining puts from the fly)

The second choice could be attractive (if you’re comfortable trading covered calls) because INTC seems a bit on the oversold side here. The call premiums aren’t great, but it will provide some cash flow while waiting for INTC to rebound.

Of course, if you didn’t get assigned, you can hold onto the put fly. (And if you didn’t make the trade, you can ignore this post!)

August 21, 2023 - 2:32 pm

Insiders,

We had some email issues so there wasn’t a reminder email for today’s live session (it should be rectified for next week). Keep in mind, Mark and I will now do these live sessions every Monday at 1 pm ET.

For those who missed, we bought a call spread today in BITO, expiring September 15th. Below you can find the trade details and Profit/Loss graph. It’s a wider bid/ask spread this time, so it may take a little longer to get filled on your order. If you can’t place vertical spread trades in your account, buying the 13.50 call by itself is a reasonable alternative.

August 14, 2023 - 2:59 pm

Insiders,

Here’s the broken wing butterfly we discussed in the Insiders live session today. As long as you have spread trading permission, you should be able to make this type of trade in a cash account. I’ve also attached the profit/loss graph below so you can see the payout structure. If you’ve never placed a butterfly trade before, the order entry screen shows exactly what it should look like. This is a roughly 30-day bullish trade in X. If you can’t do butterflies in your account, at the very bottom of this post I show the entry details for a 30-35 bullish call spread as an alternative trade.

Trade Details:

August 11, 2023 - 4:54 pm

Insiders,

Okay, I believe this is the last recap video before we switch fully to the new format for Insiders. Check out the video below for more details:

https://content.jwplatform.com/videos/68lXriW6-Bvib7p4n.mp4

August 4, 2023 - 5:44 pm

Insiders,

We have another week or two of recap videos before we transition to the new system. Here’s the video for this week:

https://content.jwplatform.com/videos/ZBxsMOGo-Bvib7p4n.mp4

July 31, 2023 - 2:29 pm

Insiders,

Trade Details:

July 28, 2023 - 4:57 pm

Insiders,

Big changes coming to Insiders on Monday! It’s all really good stuff. Check out the video for more details:

https://content.jwplatform.com/videos/m71xkAvr-Bvib7p4n.mp4

July 28, 2023 - 2:48 pm

Insiders,

ADM is making it interesting. We want to close it if its under $ 86 so there’s no assignment, and the stock is sitting right above 86. We need to it go down to $ 85.50 or so to make money, but that doesn’t seem likely at this point. Regardless, we want to close this call butterfly in 3 parts in order to get the best fills.

First, you have to buy back the 83 calls. Remember, you have 2x of those calls to buy to close. At this point, you’ll probably pay about 3.15, but the lower the better.

Next, you’ll want to sell to close the the 86 calls for the highest price you can get. Currently we’re looking at about 20 cents.

Finally, you’ll sell to close the 80 call for the highest price you can get. It’s about 6.10 or so here.

Keep in mind, once you buy to close the 83 calls, you want the stock to go higher, so if you think it will ramp into the close, you can wait a bit to close the 80 and 86 calls.

July 17, 2023 - 2:14 pm

Insiders,

Our Insider trade from the live session this week is call butterfly in ADM. This is a slightly OTM butterfly meant to profit off of ADM moving higher after earnings next week. We are buying the July 28th call butterfly using the 80-83-86 strikes. It should cost around $ 0.80, which is the most you can lose on the trade. Max gain is $ 2.20 if ADM finishes at 83 on July 28th, although a more realistic target is 50%+ gains. We need ADM to finish between 80.80 and 85.20 for the trade to be profitable. Opening trade details are below, and so is the Profit/Loss graph. Remember, with a butterfly, the middle strike is sold x2 as seen in the details below.

July 14, 2023 - 5:00 pm

Insiders,

The weekly recap video is ready for viewing.

https://content.jwplatform.com/videos/neHwL0mW-Bvib7p4n.mp4

July 14, 2023 - 3:24 pm

Insiders,

We had a brief chance to get out of TSLA for around what we paid for the butterfly, but the stock quickly dropped back to around 280. Outside of a crazy rally at the end of the hour, we can let our call butterfly expire for zero. If for some reason the stock explodes above 285, just make sure you buy back the 295 calls before selling the 285. You can let the 305 expire for zero regardless of the outcome.

July 7, 2023 - 4:41 pm

Insiders,

The weekly recap video is ready for viewing:

https://content.jwplatform.com/videos/LI4foZBp-Bvib7p4n.mp4

July 6, 2023 - 1:32 pm

Insiders,

I promised you all a TSLA trade last Monday, so here it is! This is an OTM butterfly meant to capitalize if TSLA drifts higher into earnings. We are buying the July 14th call butterfly using the 285-295-305 strikes. It should cost around $ 1.20, which is the most you can lose on the trade. Max gain is $ 8.80 if TSLA finishes at $ 295 on July 14th, although a more realistic target is 100%+ gains. We need TSLA to finish between $ 286.20 and $ 303.80 for the trade to be profitable. Opening trade details are below, and so is the Profit/Loss graph. Remember, with a butterfly, the middle strike is sold x2 as seen in the trade details below.

June 30, 2023 - 4:46 pm

Insiders,

The weekly recap video is ready for viewing. Here’s the link:

https://content.jwplatform.com/videos/vjj0HXbe-Bvib7p4n.mp4

June 30, 2023 - 2:39 pm

Insiders,

A couple Fridays ago, we placed a PACW diagonal call spread that I really liked. It was the June 30th 8.5 calls (we sold) and the July 14th 8 calls (we bought) for around 55 cents. Well, the trade expires today and we are ready to close it for a profit. If you buy back the 8.5 calls (buy to close) and sell out the 8 calls (sell to close), you should get a credit of around 70 cents. I’m showing the trade details below for closing the trade as a spread, although it will be far easier to close using two separate trades (just close the short 8.5 strike first). Assuming you get around a 70 cent credit, we’re looking at a 2-week gain of roughly 27%, which is right in line with what I’d expect for this type of trade..

Closing Details:

June 29, 2023 - 2:46 pm

Insiders,

I strongly recommend checking out the webinar I’m hosting tomorrow with Cem Karsan concerning 0DTE options. Cem is a leading voice in the options industry and you won’t want to miss what he has to say. The link to register for the webinar is below (and don’t worry if you can’t make it, you’ll get a replay link).

https://us02web.zoom.us/webinar/register/WN_xXRPOv2GTein4x_W0YvLGQ#/registration

June 16, 2023 - 4:59 pm

Insiders,

Our weekly recap video is ready for viewing at the link below. On an administrative note, I’ll be out of town on a family trip next week so there won’t be a recap video, 48 Hour Income live session, or Coffee and Condors live session next week. Reminder emails should go out about the live sessions that aren’t happening. There will be a Monday live session for Insiders despite the market being closed. We’ll talk about the new PACW diagonal I sent our earlier today.

Weekly Recap Video Link:

https://content.jwplatform.com/videos/rsdGKCWc-Bvib7p4n.mp4

June 16, 2023 - 1:31 pm

Insiders,

The market is closed on Monday, so I’m going to send out our diagonal trade now that we’d normally make during the Monday live session. We’ll still have the Monday webinar, and we’ll talk about this trade then. It’s a call diagonal very similar to the one we just closed for a profit in MARA. I really like the payout range for the call diagonal in PACW (seen below). Just like with MARA, we are selling the shorter-term call (for this trade, expiring June 30th) and buying the further out call (July 14th). In this case, we are selling an OTM call and buying the ATM call. See details and Profit/Loss graph below. The trade should cost around 55 cents (which is the most you can lose on the trade). Max gain is undefined but we’re looking for 20%-40% gains in two weeks.

Trade Details:

Profit/Loss:

June 16, 2023 - 1:05 pm

Insiders,

The short call of our MARA diagonal spread expires today. We don’t want to hold past expiration as once the front month expires, it’s no longer a diagonal spread (saying nothing of assignment of shares and such). So, we’ll close the entire spread.

We’ exit the spread exactly the opposite of how we opened it, by buying to close the June 16th call and selling to close the June 30th call. See screenshot for details. You should be able to close for 70 to 75 cents. We paid 58 cents for the spread, so closing at 70 will result in two week profits of 21%.

Closing Details:

June 9, 2023 - 5:47 pm

Insiders,

Our weekly recap video is ready for viewing.

Here’s the link:

https://content.jwplatform.com/videos/K5NvsTtF-Bvib7p4n.mp4

June 9, 2023 - 4:00 pm

Insiders,

This is coming a bit too late, but there is no action necessary if you haven’t already closed the UNG or RIVN trades. They will expire out of the money.

June 5, 2023 - 4:49 pm

Insiders,

Here’s what I’m watching this week in the markets:

With the Fed meeting not until next week and the debt ceiling resolved, this is about as slow as a news week as we’ll see (at least in terms of expected news). There are very few earnings results or economic data releases.
For economic data, the closest thing we have to important data is consumer credit on Wednesday.
Apple (AAPL) had its worldwide developer conference today and announced a new VR headset.

June 5, 2023 - 2:49 pm

Insiders,

Here’s the diagonal trade we made in the live session today. It’s a neutral-bullish trade on MARA. If you’ve never made a diagonal trade before, make it look like the screenshot below. You’ll need spread trading permission in your brokerage to make the trade, but it can be done in a cash account.

I’ve also attached a screenshot of the P/L graph for this trade. The max loss is the cost of the trade (around $ 55-60), but max gain can vary depending on what volatility does in the next two weeks. The P/L graph assumes static volatility, which is never the case. Typically I’m looking for a 20%-50% profit range on these types of trades. As always, I’ll send out a closing alert or message about how to handle the trade prior to expiration.

Details:

June 2, 2023 - 4:38 pm

Insiders,

Our weekly recap video is ready for viewing. Here’s the link:

https://content.jwplatform.com/videos/H7ZRGO5n-Bvib7p4n.mp4

May 29, 2023 - 4:05 pm

Insiders,

Here’s what I’m watching this week in the markets:

It’s a short week with today being a holiday, but the market could open up big with a debt ceiling deal apparently in place (Congress still has to vote on it)
The biggest economic news comes out on Friday with the May jobs number
A few of the bigger earnings results this week include CRM, HPQ, and AVGO

May 26, 2023 - 5:26 pm

Insiders,

The weekly recap video is ready for viewing. Here’s the link:

https://content.jwplatform.com/videos/GLLEICem-Bvib7p4n.mp4

May 22, 2023 - 4:24 pm

Insiders,

Here’s what I’m watching in the markets this week:

This is last week full trading week before we hit the debt ceiling (and next Monday is a holiday), so there could be some action around that scenario.
Friday will see the release of PCE (inflation), durable goods (consumer spending), and consumer sentiment data. It could end up being a meaningful day for market movement based on economics data.
There are some big earnings coming out this week including NVDA, COST, and LOW, along with some other smaller tech and retail names.

May 22, 2023 - 2:39 pm

Insiders,

Here’s the trade we did in the live session today. We’re buying a 3-week put in RIVN.

Details:

May 19, 2023 - 5:46 pm

Insiders,

Our weekly video recap is up and ready for viewing. Here’s the link:

https://content.jwplatform.com/videos/pFHAesFw-Bvib7p4n.mp4

May 15, 2023 - 4:11 pm

Insiders,

Here’s what I am watching this week in the market:

This is probably the last meaningful week of Q2 earnings, with some big companies reporting. Some of the popular names include CSCO, WMT, TGT, HD, DE and BABA.
Retail Sales (consumer spending) comes out on Tuesday and is likely going to be the most watched of the economic numbers for the week.
Home sales/building data will also be released throughout the week and could provide some meaningful inflation info.

May 12, 2023 - 4:28 pm

Insiders,

Our weekly recap video is up. Here’s the link:

https://content.jwplatform.com/videos/R1ggqxgl-Bvib7p4n.mp4

May 11, 2023 - 11:50 am

Insiders,

Well, you get to see firsthand the challenges with making money buying straddles and strangles. With BROS, our 28 put is in the money, but not far enough for us to turn a profit. So, even though the stock moved nearly 5 strikes from where we bought the strangle, it still wasn’t enough. That’s why we generally prefer to sell options. That being said, I think it’s a valuable experience to see how options prices move during a volatility crush.

We’re going to salvage what premium we have left in the BROS strangle by selling to close the 28 put that expires tomorrow. You can let the 34 call expire for zero. You should be able to get around 50 cents or so for the 28 put.

Trade Details:

May 8, 2023 - 6:07 pm

Insiders,

Here’s what I’m watching in the markets this week:

The big item this week is CPI, which comes out Wednesday. The market is going to want to see lower inflation numbers – or at least not higher numbers.
PPI comes out Thursday (producer prices) which are also useful as potential leading indicators to CPI.
Don’t forget that earnings season is still on with some big names reporting this week including DIS, TM, JD, RBLX, ABNB, and EA.

May 8, 2023 - 6:00 pm

Insiders,

This is the last one of these for Options For Income Pro before we switch over to 48-Hour Income.

Here’s the final pick:

SPDR S&P Regional Banking ETF (KRE)

Buy KRE and sell the June 9th 40 call for a net debit around 36.19. (The aggressive version uses the 38.50 calls, and the defensive version uses the 37 calls.)

I’m not using a buying range for this service – so use your discretion if the price changes, and feel free to change strikes as needed. Also keep in mind, I’m not tracking or managing these trades as part of the service. Don’t hesitate to email me if you have questions.

Trade Details:

May 8, 2023 - 1:55 pm

Insiders,

Our new topic this month is buying calls and puts. Today we’re doing a call trade on UNG. Nothing fancy going on – just buying a June 9th 6.50 call in UNG for around 49 cents.

Here’s the trade:

May 5, 2023 - 5:14 pm

Insiders,

I had a lot to discuss in today’s weekly recap (including next week’s new product launch), so check it out at the link below:

https://content.jwplatform.com/videos/WtRfgB5l-Bvib7p4n.mp4

May 5, 2023 - 1:47 pm

Insiders,

The RIG straddle hasn’t done what I expected, but we can still close out for a portion of our initial premium outlay. The straddle was briefly profitable after earnings (by a couple pennies), and it made sense at the time to let it ride (I was looking for 20% gains or higher). However, RIG rallied in the afternoon and we’ve basically been sitting on our hands since then waiting to see if the market selloff would bring RIG down further. Of course we’ve rallied today to make things more challenging. At this point, let’s close the put and recover about $ 38 in premiums. The call will expire for zero, so no reason to close it (just let it expire).

Trade Details:

May 1, 2023 - 4:42 pm

Insiders,

Here’s what I’m watching this week in the markets:

For the first time in a while, we have a really busy week ahead. The biggest event is undoubtedly the FOMC meeting. The results are announced Wednesday with a quarter point hike expected by the market
The March jobs report drops on Friday. ISM services PMI comes out on Wednesday
It’s also a huge earnings week with several major companies reporting. This includes AAPL, QCOM, PFE, AMD, and SBUX, to name a few

May 1, 2023 - 4:01 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow.

KraneShares CSI China Internet ETF (KWEB)

Buy KWEB and sell the June 2nd 29 call for a net debit around 27.12. (The aggressive version uses the 28 calls, and the defensive version uses the 27 calls.)

Trade Details:

May 1, 2023 - 2:07 pm

Insiders,

Here’s the trade we made today in the Insiders live session – the BROS May 12th 28-34 strangle for $ 1.25. There’s plenty of time to still place this trade if you’re interested. Earnings for BROS aren’t until next week and the price probably won’t change much before then. If you’ve never traded a strangle before, you can see how to place it in the screenshot below. Also, the profit/loss chart is shown as well.

Trade Details:

May 1, 2023 - 1:07 pm

Insiders,

The Insiders live session has started! I don’t think an email went out, so here’s the link to join:

https://us02web.zoom.us/j/84243148572

April 28, 2023 - 4:30 pm

Insiders,

The Weekly Recap Video is ready for viewing at the link below. Don’t forget we’ll have our live strategy session on Monday at 1pm ET.

Link:

https://cdn.jwplayer.com/videos/romQDr47-Bvib7p4n.mp4

April 24, 2023 - 10:55 am

Insiders, you may have seen a message earlier this morning about the Live Trading Room for today. That was sent in error. It was an automated message that had not been turned off. There is NO Live Trading Room today as I’m at the MoneyShow conference. It is rescheduled to next Monday, May 1.

I apologize for any confusion.

April 21, 2023 - 4:16 pm

Insiders,

I’ll be on the road to Las Vegas for the MoneyShow on Monday, so we’re moving the live trading session to Monday, May 1st at the usual time. The following session on Monday, May 8th will remain the same. In other words, we’ll have two weeks in a row with Monday live sessions and then we’ll back on track. I’ll keep you informed on the RIG trade via the Friday recap videos and texts (if needed).

Speaking of videos, I talk about RIG, among other things, in the latest weekly recap video linked below.

https://cdn.jwplayer.com/videos/l8mITtLM-Bvib7p4n.mp4

April 17, 2023 - 4:27 pm

Insiders,

Here’s what I’m watching in the markets this week:

This week is light on economic data but heavy on earnings. This is the first full week of meaningful earnings data.
Earnings to watch this week include (just to name a few): NFLX, TSLA, JNJ, PG, BAC, GS, UAL, and TSM.
The only somewhat important economic news this week in the US is in housing data, with housing starts on Tuesday and existing sales on Thursday.

April 17, 2023 - 4:21 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow.

SPDR S&P 500 Bank ETF (KBE)

Buy KBE and sell the May 19th 39 call for a net debit around 36.59. (The aggressive version uses the 38 calls, and the defensive version uses the 37 calls.)

Trade Details:

April 14, 2023 - 5:46 pm

Insiders,

The weekly recap video is ready for viewing.

Here’s the link:

https://cdn.jwplayer.com/videos/Buqkm9Vx-Bvib7p4n.mp4

April 10, 2023 - 4:34 pm

Insiders,

Here’s what I’m watching this week in the markets:

After a couple somewhat slow weeks, things could pick up this week with the start of earnings season plus the CPI number.
CPI comes out on Wednesday and will be the latest in inflation data (and will be watched closely by the markets).
PPI (producer prices) comes out on Thursday and is more of a leading indicator of inflation.
Retail sales (consumer spending) comes out on Friday.
Friday is also the start of earnings season and kicks of with the big banks including JPM, WFC, and C.

April 10, 2023 - 3:47 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow.

ETFMG Prime Junior Silver Miners ETF (SILJ)

Buy SILJ and sell the May 12th 12 call for a net debit around 10.97. (The aggressive version uses the 11.50 calls, and the defensive version uses the 11 calls.)

Trade Details:

April 10, 2023 - 2:07 pm

Insiders,

Our strategy for the month is the straddle (or strangle). The trade we came up with during the live session today was the May 5th 6.5 straddle in RIG. The trade details and profit/loss graph can be found below.

Details:

April 7, 2023 - 4:12 pm

Insiders,

The market is closed but the show must go on. Check out the new Insiders Weekly Recap video at the link below.

https://cdn.jwplayer.com/videos/933YaeTE-Bvib7p4n.mp4

April 3, 2023 - 6:16 pm

Insiders,

Here’s what I’m watching this week in the market:

It’s a short week with the markets closed on Friday (for Good Friday).
OPEC’s planned production cut sent oil soaring today. Let’s see what energy prices do the rest of the week.
ISM non-manufacturing PMI comes out on Wednesday and will give some insight into the strength of the service sector.

April 3, 2023 - 6:00 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow.

Global X Uranium ETF (URA)

Buy URA and sell the May 5th 21 call for a net debit around 19.57. (The aggressive version uses the 20.50 calls, and the defensive version uses the 19.50 calls.)

Trade Details:

March 31, 2023 - 6:04 pm

Insiders,

The weekly recap video is up. Here’s the link:

https://cdn.jwplayer.com/videos/eGj6fIRB-Bvib7p4n.mp4

March 31, 2023 - 3:36 pm

Insiders,

Okay, we’re cutting it close with the FRC trade, so let’s close it here. It’s worth around 55-60 cents at the moment, so not quite a winner. The best thing to do here is buy back (buy to close) the 16 strike for as little as you can get (1 or 2 cents). Then separately, sell to close the 13.5 call. You can let the 18.5 call expire for zero. You’ll want to do the two trades above in separate transactions to make sure you get the best price possible. Make sure you close it in the next 25 minutes (before market close) so you don’t exercise the 13.5 calls into stock.

March 31, 2023 - 2:39 pm

Insiders,

For those of you who attended the live session on Monday and placed the FRC call butterfly, it’s in the money, so we’re going to close it today. It’s not quite profitable at these levels, so let’s give it another half hour or so and then I’ll send out closing details.

March 27, 2023 - 5:04 pm

Insiders,

Here’s what I’m watching in the markets this week:

With the banking crisis seemingly on the mend, it could be a much calmer week than we’ve seen in a while.
The big economic data point comes on Friday in the form of PCE, the Fed’s preferred measure of inflation.
Case-Shiller home price index comes out on Tuesday, a popular method of tracking real estate levels.
There are a few scatted earnings this week including MU, LULU, and WBA.

March 27, 2023 - 5:00 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow.

Transocean (RIG)

Buy RIG and sell the April 28th 7 call for a net debit around 6.02. (The aggressive version uses the 6.50 calls, and the defensive version uses the 6 calls.)

Trade Details:

March 24, 2023 - 4:47 pm

Insiders,

The weekly recap video is ready for viewing. Here’s the link:

https://cdn.jwplayer.com/videos/qfTKprZy-Bvib7p4n.mp4

March 23, 2023 - 4:26 pm

Insiders,

Regarding our WFC butterfly, unless we have a big rally tomorrow, it’s very likely to expire out of the money. In that case, no action is necessary and you can just let the options expire.

March 20, 2023 - 5:15 pm

Insiders,

Here’s what I’m watching this week in the markets:

Normally I’d say this could be a very quiet week, except we have one on the most important FOMC meetings in memory occurring Tuesday and Wednesday. The Fed’s rates announcement will come on Wednesday.
Besides the Fed meeting, we’ll see if the global/regional banking situations settle down now that biggest issues appear to have been dealt with.
New homes sales for February come out on Thursday.
Durable goods orders are released on Friday.

March 20, 2023 - 4:54 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow.

Financial Select Sector SPDR ETF (XLF)

Buy XLF and sell the April 21st 32.50 call for a net debit around 30.67. (The aggressive version uses the 31.50 calls, and the defensive version uses the 30 calls.)

Trade Details:

March 17, 2023 - 4:29 pm

Insiders,

It’s been quite the week. Our weekly recap video can be found at the link below.

Link:

https://cdn.jwplayer.com/videos/Txt92AqM-Bvib7p4n.mp4

March 13, 2023 - 6:31 pm

Insiders,

Here’s the trade I recommended in the live session today. It’s the March 24th 39-42-45 call butterfly in Wells Fargo (WFC). You can adjust the prices/strikes as needed at open tomorrow, but the general trade format should look like the screenshot below. Below that is the profit/loss diagram for the trade. It shows max gain, max loss (which is just the cost of the trade), profit range, and breakeven points.

Details:

March 13, 2023 - 5:33 pm

Insiders,

Here’s what I’m watching this week in the markets:

It goes without saying that all eyes will be on the regional banking crisis and how it unfolds. Expect plenty of volatility this week, especially in the financial sector.
As if the banking crisis wasn’t enough, we have CPI (Tuesday) and PPI (Wednesday) coming out this week. The Fed is already under pressure to halt rate hikes given the issues with regional banks. These numbers may push the issue even further (one way or the other).
Retail sales are released on Wednesday, which is yet another economic growth/inflation data point to watch.
Just for fun, we have earnings coming out in ADBE, FDX, and DG.

March 13, 2023 - 4:58 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow.

VanEck Junior Gold Miners ETF (GDXJ)

Buy GDXJ and sell the April 14th 37 call for a net debit around 34.12. (The aggressive version uses the 35.50 calls, and the defensive version uses the 34 calls.)

Trade Details:

March 10, 2023 - 4:32 pm

Insiders,

Our weekly video is up. Check it out here:

https://cdn.jwplayer.com/videos/E3WrPSDN-Bvib7p4n.mp4

March 10, 2023 - 3:33 pm

Insiders,

In case you missed it, we had an excellent presentation last Wednesday about Defined Outcome Investing. Given the volatility in the market today, utilizing proper risk management is more important than ever (which is a lot of what Pat talks about regarding defined outcome positions).

Check out the replay here:

https://www.investorsalley.com/options-for-income-guest-speaker-video/

March 10, 2023 - 11:30 am

Insiders,

The selloff in stocks today means our CVNA put spread is now in the money. We paid about 45 cents for the spread and it’s currently trading for around 25-30 cents (although it was over 50 cents earlier this morning). You’ll definitely want to close the spread to avoid exercise and reclaim some of our capital. You can wait to see if the position will become profitable again, but there’s a risk in that scenario that the market bounces back and you get nothing.

Regarding closing, I’ll show how to close the entire spread below, but you may get a better price by closing the legs separately. In that case, you must buy back the 6.5 put first and then sell the 8 put (to avoid a naked short position). Remember, you are buying to close the 6.5 put and selling to close the 8 put. If you do both legs at once, you are closing for a net credit.

Trade Details:

March 8, 2023 - 7:49 pm

Insiders,

Just about 10 minutes to go until the guest webinar tonight! Details below.

Defined Outcome Investing is a unique approach to portfolio management that gives you an alternative to the passive 60/40 stock/bond allocation. Through using a combination of exchange traded options and U.S. Treasuries, you’ll achieve greater certainty with how your portfolio will perform, ultimately providing a much more reliable framework than diversification. Guest speaker Patrick Hennessy will show you how defined outcome investing is a reliable alternative to the tired strategies that no longer work, especially in current market conditions.

Use this link to attend:

https://us02web.zoom.us/j/86736511350

March 7, 2023 - 2:45 pm

Insiders,

It’s time to close our PINS call spread for a profit. We could wait a bit longer to let the 27 call decay to increase our gains. However, that will expose us to potential downside in the stock (and the market has been selling off). Besides, if we close here we should be locking in around 90%-100% profits.

Regarding closing, I’ll show how to close the entire spread below, but you may get a better price by closing the legs separately. In that case, you must buy back the 27 call first and then sell the 25 call (your broker most likely won’t let you have a naked short call – hence closing the short side first). Remember, you are buying to close the 27 call and selling to close the 25 call. If you do both legs at once, you are closing for a net credit.

Trade Details:

March 6, 2023 - 4:31 pm

Insiders,

Here’s what I’m watching in the markets this week:

It’s a bit slower week than usual, but we do have the jobs report for February coming out on Friday.
Powell testifies before Congress on Tuesday and Wednesday as part of his normal semi-annual reporting to Congress.
There’s not much in the way of earnings this week except for ORCL.

March 6, 2023 - 4:26 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow. I like the aggressive or defensive strike this time around as the standard doesn’t pay much of a premium.

iShares Global X Robotics & Artificial Intelligence ETF (BOTZ)

Buy BOTZ and sell the April 21st 26 call for a net debit around 23.90. (The aggressive version uses the 25 calls, and the defensive version uses the 23 calls.)

Trade Details:

March 3, 2023 - 4:08 pm

Insiders,

The weekly recap video is ready for viewing.

Here’s the link:

https://cdn.jwplayer.com/videos/E6f0iR2N-Bvib7p4n.mp4

February 27, 2023 - 5:04 pm

Insiders,

Here’s what I’m watching in the markets this week:

Not as much going on in the market this week, so it wouldn’t surprise me to see volatile decline a bit.
Major retailer earnings are still coming out including TGT, COST, and LOW all this week.
Some other important earnings include CRM, AVGO, and ZM.
ISM manufacturing data comes out on Wednesday with the more important ISM non-manufacturing number coming out on Friday.

February 27, 2023 - 4:57 pm

Insiders,

We had our second live session today for Insiders. I forgot to send out the new vertical spread immediately after, so here it is below. You may have to adjust the price/strikes a bit tomorrow if the market moves a lot on open, but the trade is still good.

The trade theme for the month is vertical spreads, so this time around we’re doing a put spread in Carvana (CVNA). We think CVNA could go down in the next couple weeks, but it’s a volatile stock. As such, the options are expensive even though the stock is only around $ 9. In order to reduce costs, we are using a vertical spread strategy.

We are buying the March 10th 6.5-8 put spread for around 0.45 (buying the 8 put, selling the 6.5 put). If you’ve never placed a put spread, just make it look like the screenshot below. You can do this spread in a cash account as long as you have spread trading permission. You can only lose what you spend (around $ 45), which is the max loss if CVNA is above $ 8 at March 10th expiration. Max gain is at $ 6.5 or below at expiration and is the difference in the spread width minus the premium cost (150 – 45) or $ 105 in this case. If you can’t trades spreads, buying the 8 put is a reasonable, albeit more expensive, substitute.

February 27, 2023 - 4:35 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

Paramount Global (PARA)

Buy PARA and sell the March 31st 23 call for a net debit around 21.26. (The aggressive version uses the 22.50 calls, and the defensive version uses the 21 calls.)

Trade Details:

February 24, 2023 - 4:22 pm

Insiders,

Don’t forget, we have the new Insiders live session on Monday. We are discussing vertical spreads for one more session and then we’ll move on to a new topic in March.

Also, the weekly recap is ready to view. Here’s the link:

https://cdn.jwplayer.com/videos/Bsryl5eZ-Bvib7p4n.mp4

February 20, 2023 - 5:32 pm

Insiders,

Here’s what I’m watching in the markets this week:

It’s a short week due to the holiday today, but there will still be some meaningful items hitting the wire.
Earnings include WMT, HD, BABA, NVDA., and EBAY.
FOMC minutes come out on Wednesday and occasionally will move the market.
PCE comes out on Friday, which is the Fed’s preferred gauge of inflation.

February 20, 2023 - 5:25 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

iShares MSCI Brazil ETF (EWZ)

Buy EWZ and sell the March 24th 30 call for a net debit around 28.06. (The aggressive version uses the 29 calls, and the defensive version uses the 28 calls.)

Trade Details:

February 17, 2023 - 4:31 pm

Insiders,

The weekly video recap is up! The link is below. Don’t forget that Monday is a holiday and the markets are closed. Enjoy the long weekend!

https://cdn.jwplayer.com/videos/CkEMVLjH-Bvib7p4n.mp4

February 13, 2023 - 5:19 pm

Insiders,

Here’s what I’m watching in the market this week:

The big number this week is CPI, which comes out Tuesday. Inflation is still the primary concern for the Fed (and thus for investors).
PPI comes out on Thursday, which tends to be a leading indicator for other inflation metrics (like CPI).
Some important earnings will be released this week including KO, CSCO, DE, AMAT, and ABNB.

February 13, 2023 - 5:03 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

iShares China Large Cap ETF (FXI)

Buy FXI and sell the March 17th 32 call for a net debit around 30.06. (The aggressive version uses the 31 calls, and the defensive version uses the 30 calls.)

Trade Details:

February 13, 2023 - 3:00 pm

Insiders,

The trade theme for the month is vertical spreads, so we’re kicking off with a new trade in Pinterest (PINS). PINS missed earnings and the stock dropped sharply, so we’ll use a call spread as an affordable way to play a mean reversion. In other words, we think the stock may be oversold, but we don’t want to spend too much money on our rebound thesis. For this purpose, we are using a call spread to reduce the premium cost. We made this trade during the live session today at slightly different prices, so if you want more details on using vertical spreads, check out the video replay.

We are buying the March 10th 25-27 call spread for around 0.72 (buying the 25 call, selling the 27 call). If you’ve never placed a call spread, just make it look like the screen shot below. You can do this spread in a cash account as long as you have spread trading permission. You can only lose what you spend (around $ 72), which is the max loss if PINS is below $ 25 at March 10th expiration. Max gain is at $ 27 or above at expiration and is the difference in the spread width minus the premium cost (200 – 72) or $ 128 in this case. If you can’t trades spreads, buying the 25 call is a reasonable, albeit more expensive, substitute.

Trade Details:

February 10, 2023 - 4:51 pm

Insiders,

The weekly recap video is up. Here’s the link:

https://cdn.jwplayer.com/videos/Kt6GqajS-Bvib7p4n.mp4

February 10, 2023 - 3:23 pm

Insiders,

Don’t forget, our new live trading room feature starts on Monday! Our theme this month is vertical spreads. We’ll discuss them and put on a trade live during the session. These live trading chats will happen every other week, with a new theme each month.

You can join Monday at 1 pm ET. Here’s the link:

https://us02web.zoom.us/j/84243148572

February 6, 2023 - 4:00 pm

Insiders,

Here’s what I’m watching in the markets this week:

It should be a calmer week after the news-heavy week we saw last time, but there are still some big data points on the radar.
In earnings we have a moderately active week with DIS, PEP, TM, and UBER leading the way.
In economics news, we’ll get the latest consumer sentiment reading on Friday.

February 6, 2023 - 3:52 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

VanEck Junior Gold Miners ETF (GDXJ)

Buy GDXJ and sell the March 10th 39 call for a net debit around 35.84. (The aggressive version uses the 37.50 calls, and the defensive version uses the 35 calls.)

Trade Details:

February 3, 2023 - 4:31 pm

Insiders,

The weekly recap video is up.

Here’s the link:

https://cdn.jwplayer.com/videos/wVWm0vO7-Bvib7p4n.mp4

January 30, 2023 - 5:35 pm

Insiders,

Here’s what I’m watching this week in the markets:

It goes without saying that the biggest event this week is the FOMC meeting on Wednesday. While the Fed will almost sure raise rates by 25 basis points, it’s what they say after the fact that really matters to the market.
This Fed meeting happens to coincide with the start of a new month, so we also get the January jobs report on Friday.
And let’s not forget, we’re still in the heart of earnings season! Several of the biggest companies are reporting. This week we get earnings from AAPL, GOOGL, AMZN, META, XOM, PFE, MCD, CAT, and many more.
Strap in folks, this week could be interesting.

January 30, 2023 - 5:20 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow – it’s a riskier trade than normal, so it may be a good time to experiment with the defensive (ITM) strategy:

Affirm (AFRM)

Buy AFRM and sell the March 3rd 18 call for a net debit around 13.98. (The aggressive version uses the 16 calls, and the defensive version uses the 14 calls.)

Trade Details:

January 27, 2023 - 4:39 pm

Insiders,

The weekly recap video is up. Here’s the link:

https://cdn.jwplayer.com/videos/BUmOwEJ5-Bvib7p4n.mp4

January 26, 2023 - 3:14 pm

Insiders,

Our GDXJ call butterfly is sitting close to the center strike, which is a very good thing. We could potential generate another 25 cents or more in profit if we wait until tomorrow. However, there are important economic numbers coming out in the morning (plus some big earnings reports tonight), so the market could be volatile. If we close now, we can get around 70 cents, which is roughly 100% gains (depending on your fill price), so let’s lock it in here.

Closing butterflies can be tricky, but since the 42 strike still has some value, you may be able to close the entire spread at once. For that, check out the screenshot below. I used 72 cents for the closing price, but you can try higher prices first (and lower, if necessary, if you can’t get filled). If it seems difficult to get filled, the next option is to buy back the short strikes (the 40.5 calls) first, and then close the long strikes. The 42 is only worth about 2 cents, so you can let it expire if you want. Regardless of how you close, it should be a nice winner for us.

Trade Details:

January 23, 2023 - 5:29 pm

Insiders,

Here’s what I’m watching this week in the markets:

It’s a huge week for news between earnings and economic data, so there could be some volatility (especially in afterhours markets)
Q4 GDP advanced estimates comes out on Thursday, along with durable goods orders and new home sales
Perhaps the most important number of the week, PCE comes out on Friday (which is the Fed’s preferred measure of inflation)
It’s a massive week for earnings including: MSFT, TSLA, JNJ, V, VZ, INTC, CVX, and many others

January 23, 2023 - 4:44 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

Global X Uranium ETF (URA)

Buy URA and sell the February 24th 23.50 call for a net debit around 22.06. (The aggressive version uses the 23 calls, and the defensive version uses the 21.50 calls.)

Trade Details:

January 20, 2023 - 4:15 pm

Insiders,

The weekly recap video is up. It was a good week for our positions!

Here’s the link:

https://cdn.jwplayer.com/videos/vBIHkxxg-Bvib7p4n.mp4

January 20, 2023 - 2:27 pm

Insiders,

We’re going to close the last of our open calendars today by exiting the RADI position. I recommend trying to close the whole thing at once (using the screenshot below) first for 75 cents. If it doesn’t get filled, you can try 70 cents. If that doesn’t work, then the best bet is close one leg at a time. You’ll need to close the short January call first (buy it back), then you can sell out the long call. Once again, try using a mid-market price first for each call and then adjust if you don’t get filled. We’re trying to get 70-80 cents total credit if possible, but even 60-70 cents should produce a nice gain on the trade.

The original cost was 35-40 cents, so if we can close at 70-80, we’re looking at nearly 100% gains on the trade.

Trade Details:

January 18, 2023 - 2:08 pm

Insiders,

We are due for an Insiders trade of a non-calendar spread variety. GDXJ (the junior gold miner ETF) has pulled back a bit this week after leveling off around 40/share. I’m moderately bullish on gold stocks, so I believe this is an opportune time to use a call butterfly that expires next Friday, the 27th.

With GDXJ right around 39 today, we’re going to buy the January 27th 39-40.5-42 call butterfly for a net debit of around 35 cents. That’s also the max loss on the trade if we finish outside of our butterfly range (39-42). Max gain is at 40.5 on January 27th and is roughly $ 1.15 in profits. Breakeven points are 39.35 and 41.65, with everything in between being profitable at expiration. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (40.5) strike and buy one of each of the wings (39 and 42).

Trade Details:

January 16, 2023 - 3:41 pm

Insiders,

Here’s what I’m watching this week in the markets:

It’s a short week due to the holiday today, but there’s still plenty of action this week in terms of news/data.
Earnings season starts in earnest with more big banks, Netflix, and also some major airlines reporting.
PPI comes out on Wednesday which can be a leading indicator for inflation.
Retails sales for December also will also hit the wire on Wednesday, showing the overall results of holiday shopping spending.

January 16, 2023 - 3:32 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

US Global Jets ETF (JETS)

Buy JETS and sell the February 17th 21 call for a net debit around 19.78. (The aggressive version uses the 20 calls, and the defensive version uses the 19 calls.)

Trade Details:

January 13, 2023 - 4:49 pm

Insiders,

The weekly recap video is ready for viewing. I talk about the strong weeks for stocks, our recent trades, and what’s coming next week.

Here’s the link:

https://cdn.jwplayer.com/videos/z2CZkR2a-Bvib7p4n.mp4

January 10, 2023 - 12:42 pm

Insiders,

It’s a reasonable time to close our DWAC calendar spread for those who made the trade. It’s currently a solid winner. We paid about 45 cents for it and we can close at 65-70 cents. If we call that a 20 cent gain, it’s a 44% winner, which is definitely inline with expectations on this trade.

For closing the trade, you can close both legs at once as seen in the screenshot below (buy to close the January 13th call and sell to close the February 3rd call at the same time). Just make sure you are closing the trade for a net credit. Your other choice is to close one leg at a time today, as long as you buy to close the January call first. Either way is fine.

Trade Details:

January 9, 2023 - 5:16 pm

Insiders,

Here’s what I watching this week in the markets:

Stocks have actually gone up for two days in a row (miraculously). Can the bullish momentum continue for a change? There’s a lot of money on the sidelines.
CPI comes out on Thursday and could be an important indicator for confirming that inflation has indeed peaked.
Earnings season kicks off at the end of the week with several big banks reporting.

January 9, 2023 - 4:36 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

iShares China Large-Cap ETF (FXI)

Buy FXI and sell the February 10th 33 call for a net debit around 30.50. (The aggressive version uses the 31.50 calls, and the defensive version uses the 30 calls.)

Trade Details:

January 6, 2023 - 4:50 pm

Insiders,

The weekly recap video is ready for viewing. The focus this week is mostly on the overall market and calendar spreads.

Here’s the link:

https://cdn.jwplayer.com/videos/W12pKa0I-Bvib7p4n.mp4

January 2, 2023 - 4:00 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow (please be aware that prices can change more than normal after a 3-day holiday weekend):

Xtrackers Harvest CSI 300 China A-Shares ETF (ASHR)

Buy ASHR and sell the February 3rd 29 call for a net debit around 27.60. (The aggressive version uses the 28 calls, and the defensive version uses the 27 calls.)

Trade Details:

December 30, 2022 - 3:58 pm

Insiders,

The last weekly recap video of the year is ready for viewing!

Here’s the link:

https://cdn.jwplayer.com/videos/JRDyTem6-Bvib7p4n.mp4

December 30, 2022 - 1:27 pm

Insiders,

It’s time to close our ASHR calendar spread for those who made the trade. It’s currently a winning trade. We paid about 24 cents for it and we can close at 30 cents. It may not seem like much, but that’s a 25% winner, which is completely in line with expectations. (Imagine doing that with more capital, across 10 different trades, and you can start to see where the calendar spread service can be lucrative.)

Back to the trade, there are two ways to handle closing it. My first choice is to do as can be seen below in the screenshot. Close both legs (buy to close the December 30th call and sell to close the January 20th call at the same time). Your other choice is to let the December call expire for zero and then close the January call on Tuesday (since the market is closed on Monday). I don’t like the latter the choice because you have weekend risk, but it is a viable way to close. (You can also close one leg at a time today, as long as you buy to close the December call first.)

Trade Details:

December 26, 2022 - 4:15 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow (please be aware that prices can change more than normal after a 3-day holiday weekend):

Marvell Technologies (MRVL)

Buy MRVL and sell the January 27th 40 call for a net debit around 36.06. (The aggressive version uses the 38 calls, and the defensive version uses the 36 calls.)

Trade Details:

December 23, 2022 - 5:52 pm

No action is necessary for the MSOS calendar spread. The December call will expire today, and we’ll hold the January call as it could be worth something should MSOS rebound over the next few weeks.

December 23, 2022 - 3:16 pm

Insiders,

Our weekly recap video is ready for viewing.

Here’s the link:

https://cdn.jwplayer.com/videos/cNjo1x3s-Bvib7p4n.mp4

December 22, 2022 - 2:48 pm

Insiders,

There’s not much trading to be done when the market is in free fall – except calendar spreads, which work in any environment (assuming they meet the metrics we are looking for in the Predicting Alpha tool). Let’s do one more calendar spread trade using Predicting Alpha metrics. MSOS was/is a weird situation, so adding another calendar gives us three (besides MSOS) to follow that should be more reflective of a typical calendar trade.

We’re going to use DWAC for our call calendar. The chart below shows the difference between implied volatility and forward volatility. That gap at the right side of the chart is what we want to see when doing a calendar spread (selling a near-term option and buying a later-month option).

Using the Predicting Alpha calculator, the price we want to get for the call calendar is about $ 0.37. However, the options spreads in DWAC are quite wide, so more realistically were looking at around $ 0.45+. That’s fine, there’s still plenty of edge in our trade if we get filled around 45 or 50 cents. It may take some time to get filled using limit orders since the spreads are so wide.

If you’ve never done a calendar trade before, make sure it looks like the screen shot below. You can enter the legs separately as long as you buy the February call before you sell the January call. Since this is a debit trade, you can execute it in a cash account (no margin needed). The most you can lose is what you pay for the trade. On expiration day (or right before) we’ll close the entire trade, so no action should be necessary until then. Remember to try to get as close to 45 cents or below as possible for the cost of the trade. It’s hard to project profit potential on calendars because we can make money if the stock is around the strike price at January expiration (17) or if volatility moves higher in general. Generally I’d like to get 10%-25% gains per trade, but that can vary quite a bit depending on the situation.

Trade Details:

December 19, 2022 - 5:28 pm

Insiders,

Here’s what I’m watching for this week in the markets:

It’s the start of vacation time, so things should be relatively slow. That being said, the S&P 500 is down 7% in two weeks, and continues to show weakness. Will we finally see a rally this week?
PCE comes out on Friday and is probably the last important economic indicator of the year regarding inflation (and in general).
Durable goods and new home sales also come out on Friday but shouldn’t move the needle that much at this point.

December 19, 2022 - 5:19 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

VanEck Junior Gold Miners ETF (GDXJ)

Buy GDXJ and sell the January 20th 36 call for a net debit around 33.19. (The aggressive version uses the 34.50 calls, and the defensive version uses the 33 calls.)

Trade Details:

December 16, 2022 - 4:50 pm

Insiders,

The weekly recap video is ready for viewing, and you can hear me sound like a completely different person given my flu-addled voice.

Here’s the link:

https://cdn.jwplayer.com/videos/ZxwjQSq2-Bvib7p4n.mp4

December 15, 2022 - 12:51 pm

Insiders,

It’s time again for a new calendar trade using the Predicting Alpha tool. This (the third we’ve done) is probably the final test trade of the strategy. We’ll ride out these positions and see what happens. We’re looking at rolling at a calendar service in Q1, but nothing is set in stone for now.

We’re going to use RADI for our call calendar. The chart below shows the difference between implied volatility and forward volatility. That gap at the right side of the chart is what we want to see when doing a calendar spread (selling a near-term option and buying a later-month option). RADI is a potential acquisition target, hence the disparity in front month/back month volatility. If an acquisition is announced, it won’t hurt our trade unless the buyout price is far away from current levels (which doesn’t seem likely).

Using the Predicting Alpha calculator, the price we want to get for the call calendar is about $ 0.21. However, the options spreads in RADI are quite wide, so more realistically were looking at around $ 0.35. That’s fine, there’s still plenty of edge in our trade if we get filled around 35 or 40 cents.

If you’ve never done a calendar trade before, make sure it looks like the screen shot below. You can enter the legs separately as long as you buy the February call before you sell the January call. Since this is a debit trade, you can execute it in a cash account (no margin needed). The most you can lose is what you pay for the trade. On expiration day (or right before) we’ll close the entire trade, so no action should be necessary until then. Remember to try to get as close to 35 cents or below as possible for the cost of the trade. It’s hard to project profit potential on calendars because we can make money if the stock is around the strike price at January expiration ($ 12.50) or if volatility moves higher in general. Generally I’d like to get 10%-25% gains per trade, but that can vary quite a bit depending on the situation.

Trade Details:

December 12, 2022 - 4:11 pm

Insiders,

Here’s what I’m watching in the markets this week:

It’s the last busy week of the year for stocks before vacation time sets in. However, this week is certainly a doozy.
The FOMC meeting is Wednesday, where we should see a 50 basis point hike. What the Fed says about forward guidance could really move the market.
CPI comes out tomorrow and will give us our latest clue about inflation. A surprise in either direction could definitely cause big swings in stocks/bonds.
Retails sales for November come out on Thursday and will clue us in to how holiday shopping season is shaping up so far.

December 12, 2022 - 4:02 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

iShares Silver Trust (SLV)

Buy SLV and sell the January 13th 22.50 call for a net debit around 21.02. (The aggressive version uses the 21.50 calls, and the defensive version uses the 20.50 calls.)

Trade Details:

December 9, 2022 - 4:23 pm

Insiders,

The weekly recap video is ready for viewing.

Here’s the link:

https://cdn.jwplayer.com/videos/g4TuAwTl-Bvib7p4n.mp4

December 7, 2022 - 1:38 pm

Insiders,

It’s time for our next calendar trade using the new Predicting Alpha tool. Keep in mind, we’ll be doing 3-4 of these over the next several weeks to test out how you all like these trades. If this strategy is popular/successful, we will use the new tool as the basis for a new trading service.

We’re going to use ASHR for our call calendar. The chart below shows the difference between implied volatility and forward volatility. That gap at the right side of the chart is what we want to see when doing a calendar spread (selling a near-term option and buying a later-month option).

Using the Predicting Alpha calculator, the price we want to get for the calendar is $ 0.24. We want to get as close to that price as possible using a debit calendar spread.

If you’ve never done a calendar trade before, make sure it looks like the screen shot below. You can enter the legs separately as long as you buy the January call before you sell the December call. Since this is a debit trade, you can execute it in a cash account (no margin needed). On expiration day (or right before) we’ll close the entire trade, so no action should be necessary until then. Remember to try to get as close to 24 cents or below as possible for the cost of the trade. We have a little wiggle room, so if you need to add a few cents to the price to get filled, that’s okay too.

Trade Details:

December 5, 2022 - 4:47 pm

Insiders,

Here’s what I’m watching in the markets this week:

There’s not much on the economic/earnings calendar this week, but there could a fair amount of end of year positioning of portfolios as we head into prime holiday season
In economic data, we will see ISM non-manufacturing PMI survey results today (service sector strength) and PPI (producer prices – possibly leading inflation indicator) on Friday
There happen to be some random large companies reporting earnings in this off period including ORCL, COST, AVGO, and LULU (all on Thursday)

December 5, 2022 - 4:26 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

iShares China Large-Cap ETF (FXI)

Buy FXI and sell the January 6th 30 call for a net debit around 27.86. (The aggressive version uses the 28.50 calls, and the defensive version uses the 27.50 calls.)

Trade Details:

December 2, 2022 - 4:14 pm

Insiders,

Our weekly video market update and position recap is ready for viewing. Here’s the link:

https://cdn.jwplayer.com/videos/T5SGaxm1-Bvib7p4n.mp4

November 30, 2022 - 1:30 pm

Insiders,

As promised, we’re going to start making a few calendar trades using the new Predicting Alpha tool. If these trades are popular, we may use the new tool as the basis for a trading service. In the meantime, it will give us some interesting, low risk trades to use for our Insider positions.

We’re going to use MSOS for our call calendar. I know we have a covered call trade in MSOS from Options For Income Pro, but it’s definitely a great stock for calendar spreads as well. The chart below shows the difference between implied volatility and forward volatility. That big gap is what we want to see when doing a calendar spread (selling a near-term option and buying a later-month option).

If you’ve never done a calendar trade before, make sure it looks like the screen shot below. We want to get as close to 45 cents or below as possible for the net debit cost. You can enter the trades separately as long as you buy the January call before you sell the December call. Since this is a debit trade, you can execute it in a cash account (no margin needed). On expiration day (or right before) we’ll close the entire trade, so no action should be necessary until then. Remember to try to get 45 cents or below for the cost of the trade.

Trade Details:

November 28, 2022 - 5:26 pm

Insiders,

Here’s what I’m watching in the markets this week:

Investors will keep an eye on Cyber Monday sales as a potential measure of economic health
Speaking of the economy, the November jobs number drops on Friday
A somewhat important inflation gauge, PCE, comes out on Thursday for October
Other economic numbers this week: Case-Shiller home prices (Tues), Personal Income/Spending (Thurs), and Retail/Wholesale Inventories (Wed)

November 28, 2022 - 4:44 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

Plug Power (PLUG)

Buy PLUG and sell the December 30th 16 call for a net debit around 14.05. (The aggressive version uses the 15 calls, and the defensive version uses the 14 calls.)

Trade Details:

November 25, 2022 - 3:54 pm

Insiders,

Our weekly recap video is ready for viewing. Hope you all are having a great Thanksgiving holiday!

Here’s the link:

https://cdn.jwplayer.com/videos/6lsZP95t-Bvib7p4n.mp4

November 21, 2022 - 4:31 pm

What I’m watching in the market this week:

It’s a short week due to Thanksgiving but investors and analysts will be paying close attention to how Black Friday sales turn out. How will inflation/fears of a recession impact holiday shopping?
New home sales and durable goods orders will be released on Wednesday
FOMC minutes also come out on Wednesday
Don’t forget the markets close at 1 pm ET on Friday

November 21, 2022 - 4:21 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

Financial Select Sector SPDR Fund (XLF)

Buy XLF and sell the December 23rd 36.50 call for a net debit around 34.98. (The aggressive version uses the 35.50 calls, and the defensive version uses the 34 calls.)

Trade Details:

November 18, 2022 - 4:27 pm

Insiders,

The weekly recap video is up. I also talk about the potential for a new trading service that could be fun.

Here’s the link:

https://cdn.jwplayer.com/videos/0eBmk0hH-Bvib7p4n.mp4

November 18, 2022 - 1:56 pm

Insiders,

Our COIN call butterfly expires today. Their CFO said some very negative things during the week (like how they aren’t sure what the damage from the FTX collapse will be yet) and the stock unsurprisingly took a big hit. Our position will expire out of the money, so no action is necessary.

November 14, 2022 - 4:01 pm

Insiders,

Here’s what I’m watching in the markets this week:

Market volatility has come way down after the events of last week (midterm elections, CPI). There isn’t too much on the calendar until mid-December, so we may see a continued softening in market volatility metrics like the VIX
PPI comes out this week and can be a leading indicator of inflation (producers tend to pass on higher/lower prices to consumers)
Other economic indicators this week include retail sales, existing home sales, building permits, and housing starts
Big box retailers report this week including WMT, TGT, HD, and LOW. Some big tech companies also report including NVDA, BABA, CSCO, and AMAT

November 14, 2022 - 3:13 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

AdvisorShares Pure US Cannabis ETF (MSOS)

Buy MSOS and sell the December 16th 15 call for a net debit around 11.05. (The aggressive version uses the 13 calls, and the defensive version uses the 11 calls.)

Trade Details:

November 11, 2022 - 4:26 pm

Insiders,

What a week! Clearly a lot happened this week (and is still happening), but overall it has been a really good week for stocks. I discuss the week’s events in our weekly video recap, linked below.

https://cdn.jwplayer.com/videos/L3CxIOee-Bvib7p4n.mp4

November 11, 2022 - 1:37 pm

Insiders,

I have a new trade recommendation today based on the craziness in the cryptocurrency world, namely the downfall of FTX. It’s a bit riskier than most of my trades, so keep that in mind. My theory (and plenty of others agree) is that Coinbase (COIN) is actually in good shape after the demise of FTX because it’s a regulated exchange in the US. While the cryptocurrencies themselves are getting hammered, COIN itself is a relatively safe place to store money because it is regulated. The stock seems to have hit a bottom and bounced, so we’ll use a butterfly to trade a potential neutral to bullish range in COIN for the next week.

Let’s buy the COIN November 18th 55-60-65 call butterfly for about $ 1.00 net debit (although you can try to get a better price first as the spreads are a bit wide). That’s also the max loss on the trade if we finish outside of our butterfly range (55-65). Max gain is at 60 on November 18th and is roughly $ 4.00 in profits. Breakeven points are 56 and 64. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (60) strike and buy one of each of the wings (55 and 65). There isn’t a great substitute for this trade, so if you can’t do butterflies in your account, it’s probably best to sit this one out.

Trade Details:

November 9, 2022 - 5:08 pm

Insiders,

Just wanted to remind you about the guest webinar tonight with Kevin Davitt from Nasdaq. Kevin is a great speaker. We’re going to be talking primarily about volatility and options strategies, and of course, we’ll answer lots of questions.

I hope you’ll be able to come!

Here’s the link:

https://yn345.keap-link003.com/v2/click/479dc3fa77257d61b20d3c9a6c696075/eJyNkE0LgkAQhv_LnCXXVbf0JhIiVoeoc1gOtJXrso6Fhf-97YNOBV3nfeYZ3rkBoSoV5RXE0Cs_CMEBgzupJSpKG0Xl7hlGjEfMgZNUx8w0nYb49m31kz-mHos4Fw5Qr9Eyq2WSFvki28zyRWFZXRp74x8RZ4JHIviYpvMkn8Ew_FRjLWl6tvYWYjIdPjpV0vaitTlZfk-k29h1u5bxC25H16apR13rHtyJGPsi9Dw_ZNZTao2qer-hwP5lG-4rNWIW

November 7, 2022 - 5:31 pm

Insiders,

Here’s what I’m watching for this week in the markets:

The midterm elections are tomorrow, although we may not have all the results until later in the week. Political gridlock is generally good for the markets, but I expect that any market moves based on election results will be short-lived in nature (as the economy/inflation is what matters most)
CPI comes out on Thursday, so we get to see if Powell is justified in his hawkishness. Inflation is still the key concern for investors (more so than a recession)
Most of the meaningful earnings are past us now, but we do have DIS this week along with a few interesting names like MOS, RBLX, and OXY

November 7, 2022 - 5:12 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

iShares MSCI Brazil (EWZ)

Buy EWZ and sell the December 9th 34 call for a net debit around 31.36. (The aggressive version uses the 32.50 calls, and the defensive version uses the 31 calls.)

Trade Details:

November 4, 2022 - 4:19 pm

Insiders,

The weekly recap video is ready for viewing.

Here it is:

https://cdn.jwplayer.com/videos/mhMx9SkW-Bvib7p4n.mp4

Have a great weekend!

November 3, 2022 - 1:49 pm

Insiders,

The Fed didn’t help us any on our TLT call spread, but there’s still some profit left in the trade for those who haven’t closed it yet. Let’s go ahead and do that now (if you haven’t already done so).

If you’ve never closed a call spread, just make it look like the screenshot below. You can close it in two trades as well as long as you close the short leg first. Remember to sell to close the 95 strike and buy to close the 98 strike. If we close at a net credit of 1.16, we are making about 26% profits on the trade.

Trade Details:

October 31, 2022 - 1:12 pm

Insiders,

Here’s what I’m watching in the markets this week:

The elephant in the room for this week is the FOMC meeting on Wednesday. The Fed is expected to bump rates up by another 75 basis points. The biggest market reaction could come from any change in the language in the FOMC statement and the expectations for what may happen at the December meeting
The jobs report for October comes out on Friday and will shed more light on economic conditions
Finally, earnings are still going strong this week with results coming from PFE, AMD, COP, SBUX, and PYPL

October 31, 2022 - 1:05 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

US Global Jets ETF (JETS)

Buy JETS and sell the December 2nd 18.50 call for a net debit around 17.29. (The aggressive version uses the 18 calls, and the defensive version uses the 17 calls.)

Trade Details:

October 28, 2022 - 4:44 pm

Insiders,

It’s been a solid week for stocks (outside of a few hard-hit tech names). Let’s take a closer look in the weekly recap video.

Here’s the link:

https://cdn.jwplayer.com/videos/MuGqHIox-Bvib7p4n.mp4

October 24, 2022 - 5:19 pm

Insiders,

Here’s what I’m watching for this week in the markets:

It’s huge week for earnings with the biggest companies reporting including: AAPL, MSFT, GOOG, META, AMZN, XOM, CVX, MCD, MA, and many many more
Plenty of important economic numbers will also be released this week, including the advanced estimate for Q3 GDP (Thursday)
Another inflation measure, PCE, will come out on Thursday, along with durable goods orders
Consumer confidence and personal spending figures will come out on Friday

October 24, 2022 - 5:06 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

Chargepoint (CHPT)

Buy CHPT and sell the November 18th 14 call for a net debit around 11.89. (The aggressive version uses the 12.5 calls, and the conservative version uses the 11 calls.)

Trade Details:

October 21, 2022 - 4:22 pm

Insiders,

Not a bad week for stocks for a change! I talk about that and our recent positions in the weekly video recap, linked below.

https://cdn.jwplayer.com/videos/UO4s7udg-Bvib7p4n.mp4

October 21, 2022 - 2:15 pm

Insiders,

I may be early on this trade, but I feel strongly that TLT (long-term Treasury bonds) have sold off too much this week. I believe some mean reversion is in order. We’re going to buy a two-week call spread, with the idea that bonds will rebound to some extent over that period. With a call a spread, you are simply buying the lower strike call and selling the higher strike call (to reduce the cost of the trade) at the same time in the same expiration. You can see the details below. If you can’t trade spreads in your options account, you simply buy the 95 call (but it will definitely be more expensive). A call spread, bull call spread, or vertical spread are all names your broker may use for this trade. You can do this trade in two parts as long as you buy the 95 call before you sell the 98 call.

Buying the 95 call and selling the 98 call on November 4th should cost around 92 cents. That’s the most you can lose on this trade if TLT is below 95 at expiration. Max gain is at 98 or above and is roughly 2.08 in profits. The breakeven point at expiration is 95.92.

Trade Details:

October 20, 2022 - 2:06 pm

Insiders,

CS is right around 4.50 with a day to expiration, so our call butterfly has worked out nearly perfectly. Let’s close the butterfly here for a profit. Closing a butterfly can sometimes be a bit a tricky. So, first off, try closing the entire butterfly as seen in the screenshot below. If you can’t get filled for 30 cents (or at least 25 cents), then what I usually do is close it in parts. You always have to close the shorts first, which means you’ll buy to close the 4.5 calls for around 15 cents. After that you’ll sell to close the 4 call for the best price you can get (try mid market first – about 55 cents). You can then try to close the 5 call for 5 cents, although it may not happen (in which case you use a market order or just let it expire).

If you can close the whole thing at once for 30 cents, we’ll make 100% profits. If you close at 25 cents, it’s 67% profits (closing for 25 cents is probably more likely if you close in parts).

Trade Details:

October 19, 2022 - 6:49 pm

Insiders,

Here’s my spot on TradeTalks today. It’s about 4 minutes, with the focus on market volatility.

.@InvestorsAlley Lead Options Analyst @jsoloff joins @JillMalandrino on @Nasdaq #TradeTalks to discuss how you can potentially take advantage of the high levels of volatility in trading and investing. $VOLQ https://t.co/s0V7kvWnWY

— TradeTalks (@TradeTalks) October 19, 2022

October 19, 2022 - 1:37 pm

Insiders,

I’m going to be on TradeTalks in about 45 minutes, talking about market volatility. I’ll send a link when a recording is available. However, there should be a live stream of the event (2:15 ET) at TradeTalks on Nasdaq.com or on the TradeTalks Twitter feed.

October 18, 2022 - 6:24 pm

Insiders,

I’m really excited about the guest webinar tomorrow with my friend Mark Phillips. For the Insiders crowd, this material is going to be very relatable. Remember, it’s at 12 pm ET time tomorrow instead of our normal time at night. Hope you can all make it!

Details are below:

In our next monthly guest speaker webinar for Options for Income we are hosting Mark Phillips from Harvested Financial.

The webinar starts at noon eastern on Wednesday, October 19th.

No need to register, just use this link at that time: https://us02web.zoom.us/j/86736511350.

Mark will share with us how to look at volatility risk premium and what factors options capture. We will take a deep dive into various ways option strategies can complement investors’ portfolios.

Importantly, Mark will also show you how to manage risk, capture opportunities, and customize a portfolio strategy that is tailored to your objectives.

I’ve known Mark for years and am excited that he’s agreed to be our guest this month. Mark currently provides investment management and consulting services for equity options and is with registered investment advisory firm Harvested Financial.

This webinar is a free benefit of your Options for Income membership. Use this link at noon eastern on Wednesday to join us: https://us02web.zoom.us/j/86736511350.

October 17, 2022 - 4:24 pm

Insiders,

Here’s what I’m watching this week in the markets:

Monday got off to a nice start, with the S&P 500 up over 2.5%. The VIX didn’t move all that much, and the term structure is still in backwardation. Will we finally see a multiple-day rally? The VIX certainly isn’t convinced
It’s a massive week for earnings. Here are a few of the biggest ones coming up: NFLX, JNJ, TSLA, PG, UNP, and GS (plus many more)
On the economic front, it’s also a big week for housing data with housing starts, building permits, and existing home sales all being released

October 17, 2022 - 4:12 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

Global X Uranium ETF (URA)

Buy URA and sell the November 18th 22 call for a net debit around 19.17. (The aggressive version uses the 20 calls, and the conservative version uses the 18 calls.)

Trade Details:

October 14, 2022 - 4:09 pm

Insiders,

Another volatile week in the markets is in the books. I talk about it in our weekly recap, linked below.

https://cdn.jwplayer.com/videos/XqKMtULe-Bvib7p4n.mp4

October 10, 2022 - 6:16 pm

Insiders,

Here’s what I’m looking at this week in the markets:

It’s going to be a busy week for news. Perhaps that’s why the VIX term structure is inverted (in backwardation) at the moment. We’ll see if the curve normalizes after some of the big news items drop this week
All eyes will be on CPI on Thursday. The inflation number could provide us the biggest clue yet if the Fed intends to jack rates up another 75 basis points at the next FOMC meeting
Speaking of the Fed, the minutes from the September FOMC meeting come out this week and could shed some light on how hawkish the Fed truly is
Producer prices and retail sales are released this week and will provide additional data points on the economy
Earnings season kicks off at the end of the week with earnings from some of the biggest banks including WFC, JPM, MS, and C

October 10, 2022 - 5:54 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

VanEck Fallen Angel High Yield Bond ETF (ANGL)

Buy ANGL and sell the November 18 27 call for a net debit around .60. (The aggressive version uses the 26 calls, and the conservative version uses the 24 calls.)

You will collect a roughly 10 cent per share dividend during the course of this trade.

Trade Details:

October 6, 2022 - 5:28 pm

Insiders,

I’ll be on the road tomorrow, so I’m sending out our weekly recap video today. The email with the video link will still come out at the normal time tomorrow afternoon, but if you want to watch it early, here’s the link:

https://cdn.jwplayer.com/videos/EJaxqvRS-Bvib7p4n.mp4

October 5, 2022 - 2:15 pm

Insiders,

The Credit Suisse (CS) stuff is way overdone. The bank has issues but nothing like what social media is making it out to be. This could be a great spot to sell puts, but since we don’t do credit trades in Insiders, I think a very reasonable alternative is using a call butterfly.

Let’s buy the CS October 21st 4-4.5-5 call butterfly for about 15 cents (net debit). That’s also the max loss on the trade if we finish outside of our butterfly range (4-5). Max gain is at 4.5 on October 21st and is roughly 35 cents in profits. Breakeven points are 4.15 and 4.85. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (4.5) strike and buy one of each of the wings (4 and 5). As a substitute for this trade, you can sell cash secured puts on the 4 strike, if you’re comfortable with that type of trade.

Trade Details:

October 3, 2022 - 5:23 pm

Insiders,

Here’s what I’m watching this week in the markets:

It’s the first week of a new quarter, which can often come with stock buying programs. Can the buying we saw today gain any momentum, or is it simply a bounce in an otherwise downward trend?
Non-farm payrolls for September come out on Friday. The jobs number is still the second most important number that is released monthly after CPI (and possibly PCE).
You can safely ignore the Credit Suisse noise. In fact, we’ll be making a bullish trade on CS for Insiders as early as tomorrow.

October 3, 2022 - 5:12 pm

Insiders,

Here’s the Options For Income Pro trade for tomorrow:

Financial Select Sector SPDR Fund (XLF)

Buy XFL and sell the November 4th 32.50 call for a net debit around 30.68. (The aggressive version uses the 31.50 calls, and the conservative version uses the 30 calls.)

Trade Details:

September 30, 2022 - 4:43 pm

Insiders,

It’s the end of a depressing quarter for stocks (and bonds). I discuss the quarter and our recent positions in the weekly recap video.

Here’s the link:

https://cdn.jwplayer.com/videos/PQiTXydh-Bvib7p4n.mp4

September 30, 2022 - 2:32 pm

Insiders,

The market clearly was not ready to rebound this week. Neither our X nor IWM call butterflies are close to being in the money. That means we’ll just let them expire for zero. No action is necessary. We’ll get back into a new Insider trade next week. Let’s see what the market looks like on Monday and we’ll go from there.

September 26, 2022 - 7:15 pm

Insiders,

Here’s what I’m watching in the markets this week:

Will the selling stop? Stocks are down big. Volatility is up. When will it end? How much damage has to be done for the Fed to be happy?
Speaking of the Fed, the inflation number they prefer to look at, PCE, comes out on Friday. Undoubtedly investors will be keenly interested in the result.
This week we’ll also have new data points for durable goods, new home sales, and pending home sales.
We’re between earnings seasons, but we do get Nike and Micron earnings coming out this week.

September 26, 2022 - 7:06 pm

Insiders,

Before I post the trade coming out in tomorrow’s Options For Income Pro issue, I want to mention that I’ll be on a panel discussing volatility at the MoneyShow Virtual Expo this Wednesday at 1:20 ET. The link to the session info is just below the graphic:

Link:

https://online.moneyshow.com/2022/september/virtual-expo//workshop/e4c08a7f7a104bdb9bc6ad720fc13281/volatility-in-context//?scode=035323

Okay, here’s the trade for tomorrow:

Viper Energy Partners (VNOM)

Buy VNOM and sell the October 21st 27 call for a net debit around .75. (The aggressive version uses the 26 calls, and the conservative version uses the 24 calls.)

Trade Details:

September 23, 2022 - 4:29 pm

Insiders,

Tough week for stocks with the market nearing 52-week lows. I talk about that and more in our weekly recap video.

Here’s the link:

https://cdn.jwplayer.com/videos/5v9dT6Mv-Bvib7p4n.mp4

September 22, 2022 - 12:12 pm

Insiders,

I believe the market is straight up oversold at this point. ETF index calls aren’t that cheap so we’ll use a butterfly to bet on a bounce before next Friday (the 30th). We’ll also use IWM instead of SPY or QQQ because it’s a lower-priced index (so the options are cheaper) but still 90% correlated to the others.

Let’s buy the IWM September 30th 175-180-185 call butterfly for about 77 cents (net debit). That’s also the max loss on the trade if we finish outside of our butterfly range (175-185). Max gain is at 180 on September 30th and is roughly 4.23 in profits. Breakeven points are 175.77 and 184.23. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (180) strike and buy one of each of the wings (175 and 185). As a substitute for this trade, you can do a vertical (buy a call spread) or straight up buy calls, but in both cases the trades will cost quite a bit more in premium.

Trade Details:

September 19, 2022 - 5:04 pm

Insiders,

Here is what I’m looking at this week:

The big event is clearly the FOMC meeting, which concludes on Wednesday. A 75-basis point hike is expected. A surprise full percent hike would likely cause a major selloff. Any language that suggests anything more or less than 75-basis point hike in November will also move the markets.
Housing starts and building permits for August will be released this week, providing some insight into whether (how much) the housing market is cooling.
Costco (COST) has earnings this week (yet another data point regarding retail behavior) as does FedEx (FDX). We already know FDX will disappoint since they preannounced a few days ago, which resulted in a broad market pullback at the time.

September 19, 2022 - 4:17 pm

Insiders,

Here is our next Options For Income Pro trade, coming out tomorrow:

Global X Copper Miners ETF (COPX)

Buy COPX and sell the October 21 32 call for a net debit around 29.65. (The aggressive version uses the 31 calls, and the conservative version uses the 29 calls.)

Trade Details:

September 16, 2022 - 4:52 pm

Insiders,

There’s a lot of info this week in the recap video, including a full breakdown of what happened with the SLV trade. Check it out at the link below.

https://cdn.jwplayer.com/videos/XIhl8SMm-Bvib7p4n.mp4

September 16, 2022 - 2:38 pm

Insiders,

We’ve had a lot of unexpected things happen with our SLV calendar. I will explain what happened in the weekly recap video that comes out later today. For now, I’ve decided we will close the trade entirely instead of continuing with the strategy. It turns out that SLV is an early exercise candidate for reasons I’ll explain in the video and I don’t want us to have to deal with the early exercise issues we had this week. If you didn’t get assigned on your short call, just use the screenshot below as a template for closing the trade. If you did get assigned, you need to buy back your shares and sell to close the long call. Buying back the shares may require you to contact your broker because of some weird rules dealing with ETFs like SLV.

We may revisit a calendar spread in the future, but it won’t be with an ETF. For now, we’re going to move on and stick to our more traditional butterflies and vertical spreads. In theory, after closing the spread for around 18 cents (as seen below), we are only taking a $ 15 loss on the trade. Clearly though, dealing with early exercise is not worth the hassle.

Trade Details:

September 15, 2022 - 2:46 pm

Insiders,

We’ll have an update on the SLV trade tomorrow, but for now, let’s add a new trade in US Steel (X). X provided negative guidance for third quarter earnings, but the stock was already down big yesterday when Nucor provided similar news. The bad news is already built in, and the company is still set to have a strong year overall. Let’s use a call butterfly to bet on a bit of a rebound in the stock price over the next couple of weeks.

Let’s buy the X September 30th 20.5-22.5-24.5 call butterfly for about 44 cents (net debit). That’s also the max loss on the trade if we finish outside of our butterfly range (20.50-24.50). Max gain is at 22.50 on September 30th and is roughly 1.56 in profits. Breakeven points are 20.94 and 24.06. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (22.50) strike and buy one of each of the wings (20.50 and 24.50). As a substitute for this trade, you can do a vertical (buy a call spread) or straight up buy calls, but in both cases the trades will cost quite a bit more in premium.

Trade Details:

September 12, 2022 - 5:06 pm

Insiders,

Here is our next Options For Income Pro trade, coming out tomorrow:

iShares Global Clean Energy ETF (ICLN)

Buy ICLN and sell the October 14 24 call for a net debit around 22.61. (The aggressive version uses the 23 calls, and the conservative version uses the 22 calls.)

Trade Details:

September 12, 2022 - 12:59 pm

Insiders,

Here is what I’m looking at for the week of September 12th:

As the relief rally continues, we have several key economic numbers coming out this week. The biggest one is tomorrow, with CPI giving us a good look at where inflation stands
Retails sales drop on Thursday along with a host of less important indicators (business inventories, industrial production, et al)
Consumer sentiment comes out on Friday and can be important as a leading indicator

September 9, 2022 - 4:57 pm

Insiders,

My audio cut out on the weekly recap video after about 6:30 into the recording. I was just about done, but here are the few things I mentioned after that point:

The XME covered call turned out to be a solid winner in Options For Income. I don’t expect to do too many that high in price, but I will mix them in now and then.
The new trade in Options For Income this week was in EWG, which is doing well so far. It’s a more conservative trade for a covered call.
I plan to do a new Insider trade next week. It won’t be a calendar as I don’t want to have more than one on at once. It will likely be a butterfly or vertical spread. I’m not sure when I will make the recommendation, so stay tuned.

September 9, 2022 - 4:38 pm

Insiders,

We had a nice rally in stocks to close out the week. I talk about that and more in the weekly recap video.

Here’s the link:

https://cdn.jwplayer.com/videos/FL2Cwqui-Bvib7p4n.mp4

September 5, 2022 - 5:07 pm

Insiders,

Here is our next Options For Income trade, coming out tomorrow:

iShares MSCI Germany ETF (EWG)

Buy EWG and sell the October 7 22.50 call for a net debit around .02. (The aggressive version uses the 21.50 calls, and the conservative version uses the 20.50 calls.)

(Ignore the posted mid-market price – the numbers are distorted because of the market being closed for a 3-day weekend.)

Trade Details:

September 2, 2022 - 4:35 pm

Insiders,

Our weekly recap video is up. Here’s the link:

https://cdn.jwplayer.com/videos/f8MyUKoh-Bvib7p4n.mp4

Have a great 3-day weekend!

September 2, 2022 - 2:12 pm

Insiders,

The price of gold has fallen off a cliff, so we’ll just let our GOLD calls expire. However, the fact that precious metals have pulled back gives us an opportunity to try out a new strategy. We’re going to place a calendar spread trade in SLV, with the idea that silver prices will turn around in the next month.

The idea behind the trade is we want to own at-the-money October 14th SLV calls, but we want to try to reduce our cost of owning those calls over time. So, we’ll sell a September 16th call at the same time that we buy the October ones. After the September call expires, we can then continue to sell calls (weekly or biweekly) until we own the October 14th calls for as little premium as possible.

We’re starting out with a very low risk calendar trade. The most we can lose in the 33 cents it costs to place this trade (if SLV moves too far away from 16.50 in the next couple weeks). However, even if SLV does move, once the September 16th calls expire, we can either sell calls at a different at a different strike or choose to not sell calls and let the October calls ride.

We’ll talk more about this trade in the weekly video that will come out later today. Check out the details below for how to place the trade. As long as you can trade debit spreads in your account, you should be able to make this trade. It should not require a margin account.

Trade Details:

August 29, 2022 - 4:48 pm

Insiders,

Here’s what I’m looking at for the week of August 29th:

At Jackson Hole, the Fed decided to essentially jawbone stocks lower. Stocks opened the week down a little, but nothing crazy. We will find the bottom this week to the most recent pullback in share prices?
The jobs number for August drops on Friday. It’s hard to say what the markets are looking for at this point, but my assumption is a good jobs numbers is better despite the Fed’s inflation concerns
Some scattered earnings are coming out this week including AVGO, BIDU, and LULU

August 29, 2022 - 4:25 pm

Insiders,

Here is our next Options For Income trade, coming out tomorrow. This is our monthly member-submitted trade, so it’s the only time we may use a single stock instead of an ETF.

Pinterest (PINS)

Buy PINS and sell the September 30th 25 call for a net debit around 21.95. (The aggressive version uses the 23 calls, and the conservative version uses the 20 calls.)

Trade Details:

August 26, 2022 - 4:32 pm

Insiders,

Big down day today in stocks. I talk about that and more in our weekly recap video.

Here’s the link:

https://cdn.jwplayer.com/videos/7o8q4zPB-Bvib7p4n.mp4

August 22, 2022 - 6:10 pm

Insiders,

Here is our next Options For Income trade, coming out tomorrow.

KraneShares CSI China Internet ETF (KWEB)

Buy KWEB and sell the September 23rd 30 call for a net debit around 27.06. (The aggressive version uses the 28 calls, and the conservative version uses the 26 calls.)

I’m not using a buying range for this service – so use your discretion if the price changes, and feel free to change strikes as needed. Also keep in mind, I’m not tracking or managing these trades as part of the new service. Don’t hesitate to email me if you have questions.

Trade Details:

August 22, 2022 - 6:04 pm

Insiders,

Here’s what I’m looking at for the week of August 22nd:

The Fed conference in Jackson Hole is this week. It’s a heavily watched event, and investors will closely watch speeches from Fed officials for clues as to the next interest rate decision
PCE (price index) comes out on Friday and will give an important data point on inflation
Some notable earnings reports this week: NVDA, CRM, ZM and several more retail companies

August 19, 2022 - 4:46 pm

Insiders,

The weekly video recap is available for viewing.

Here’s the link:

https://cdn.jwplayer.com/videos/x3OENNde-Bvib7p4n.mp4

August 19, 2022 - 2:25 pm

Insiders,

EQT has finally pulled back enough where we can close the butterfly for a profit. Now closing a fly can sometimes be a bit a tricky. So, first off, try closing the entire butterfly like seen in the screenshot below. If you can’t get filled for at least 85 or 90 cents credit (start with 90), then what I usually do is close it in parts. You always have to close the shorts first, which means you’ll buy to close the 46 calls (try for mid market). After that you’ll sell to close the 43 call for the best price you can get (again, try mid market first). At that point, if the 49 call still has value, you can close it too.

Assuming you can around 90 cents credit for the whole thing (or the parts), we’re looking at about 50% gains.

Trade Details:

August 18, 2022 - 3:01 pm

Insiders,

With Options Floor Trader Pro no longer a thing, I can start to mix in naked call or put buying opportunities as I come across them. That is, if a spread doesn’t make sense, I can just use a call or put for a directional trade. And that’s exactly the case today for Barrick Gold (GOLD). The stock hit my radar because the implied volatility has moved way up (meaning the stock could be about to move). Normally, that’s a spread trading situation, but even the ITM calls don’t cost that much. So we’re going to take a shot on a two-week trade. Let’s buy the September 2nd 16 calls in GOLD for around 64 cents. The breakeven point is 16.64 in the stock, which is only about 25 cents away as I write this.

(For those in the EQT butterfly – it looks like our exit point will be tomorrow. Stay tuned.)

Trade Details:

August 15, 2022 - 4:49 pm

Insiders,

Here is our next Options For Income trade, coming out tomorrow.

US Global Jets ETF (JETS)

Buy JETS and sell the September 16th 20 call for a net debit around .74. (The aggressive version uses the 19 calls, and the conservative version uses the 18 calls.)

I’m not using a buying range for this service – so use your discretion if the price changes, and feel free to change strikes as needed. Also keep in mind, I’m not tracking or managing these trades as part of the new service. Don’t hesitate to email me if you have questions.

Trade Details:

August 15, 2022 - 3:45 pm

Insiders,

Here’s what I’m looking at for the week of August 15th:

July retail sales come out on Wednesday. Let’s see if they are better than last quarter
FOMC minutes also are released on Wednesday
Lots of housing data to see this week including housing starts and existing home sales
It’s retail week for earnings with WMT, TGT, HD, and LOW all being released

August 12, 2022 - 4:34 pm

Insiders,

It was another big week for stocks. I talk about that and more in our weekly recap.

Here’s the link:

https://cdn.jwplayer.com/videos/Zpheem61-Bvib7p4n.mp4

August 8, 2022 - 4:37 pm

Insiders,

Here is our second Options For Income trade, coming out tomorrow.

SPDR S&P Metals & Mining ETF (XME)

Buy XME and sell the September 9th 52 calls for a net debit around 47.85. (The aggressive version uses the 49.50 calls, and the conservative version uses the 47 calls.)

I’m not using a buying range for this service – so use your discretion if the price changes, and feel free to change strikes as needed. Also keep in mind, I’m not tracking or managing these trades as part of the new service. Don’t hesitate to email me if you have questions.

Trade Details:

August 8, 2022 - 3:09 pm

Insiders,

Here is what I’m looking at for the week of August 8th:

The most important economic number of the month, CPI, comes out on Wednesday. Will we finally see a decline in headline inflation?
Producer prices and consumer sentiment data also will be released later in the week
Earnings season is winding down, but a few interesting names report this week including DIS, WYNN, RBLX, and COIN

August 5, 2022 - 4:42 pm

Insiders,

Our weekly recap is up. Have a great weekend!

Here’s the link:

https://cdn.jwplayer.com/videos/xhtT3ALR-Bvib7p4n.mp4

August 4, 2022 - 2:06 pm

Insiders,

I’ve been looking for a natural gas trade to make for us in Insider, so I appreciate the suggestion from our last webinar to look at EQT (EQT). The pure-play natural gas stock has bullish potential over the next couple weeks (possible LNG deals, rebound in nat gas futures, etc.). The options only trade monthly, and they are a bit expensive, so using a call butterfly is my preference here.

I am recommending we buy the EQT August 19th call butterfly for about 65 cents (net debit). That’s also the max loss on the trade if we finish outside of our butterfly range (43-49). Max gain is at 46 on August 19th and is roughly 2.35 in profits. Breakeven points are 43.65 and 48.35. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (46) strike and buy one of each of the wings (43 and 49). As a substitute for this trade, you can do a vertical (buy a call spread) or straight up buy calls, but in both cases the trades will cost quite a bit more in premium.

Trade Details:

August 1, 2022 - 5:09 pm

Insiders,

Our very first trade for Options For Income comes out tomorrow… and here it is!

Global X Uranium ETF (URA)

Buy URA and sell the September 2nd 23 calls for a net debit around .00. (The aggressive version uses the 22 calls, and the conservative version uses the 20 calls.)

I’m not using a buying range for this service – so use your discretion if the price changes, and feel free to change strikes as needed. Also keep in mind, I’m not tracking or managing these trades as part of the new service. Don’t hesitate to email me if you have questions.

Trade Details:

August 1, 2022 - 3:21 pm

Insiders,

Here’s what I’m looking at the for the week of August 1st:

July employment numbers come out at the end of the week and will be closely watched as a potential recessionary indicator
OPEC meets mid-week and could have a big impact on oil prices
Several oil companies also report earnings this week including COP, OXY, and FANG
Other big earnings this week include SBUX, AMD, EBAY, CVS, and BABA

July 29, 2022 - 4:18 pm

Insiders,

The weekly video recap is now up. Here’s the link:

https://cdn.jwplayer.com/videos/LOOEJ8vN-Bvib7p4n.mp4

And don’t forget – Options For Income kicks off next week! I cover some of the details in the video. First new trade on Tuesday!

July 29, 2022 - 3:25 pm

Insiders,

TWTR decided right before the expiration of our butterfly to break out of its trading range (to the upside). That means our put butterfly is out of the money and will expire for zero. No action necessary. On the bright side, there are some really great trading opportunities out there for us to explore next week. Stay tuned!

July 25, 2022 - 5:25 pm

Insiders,

Our final Options Floor Trader Pro trade (before we switch next week to Options For Income) is here. We’re buying the DISH Network (DISH) August 19th 19.50 calls for around 90 cents with a buying range up to 1.75.

Trade Details:

July 25, 2022 - 2:44 pm

Insiders,

Here’s what I’m looking at for the week of July 25th:

It’s a huge week for news, although action may be dialed back to some extent due to summer holidays
It’s the busiest week of earnings season with MSFT, AAPL, AMZN, GOOGL, and FB all reporting (among many others)
Not to be outdone by earnings, the FOMC has a key policy meeting this week, with a 75 basis point hike expected for Wednesday
We also get an advanced estimate of second quarter GDP, and what the means in terms of economic growth (or lack thereof)

July 25, 2022 - 2:26 pm

Insiders,

Shares in Regions Financial (RF) continued their march higher today. As such, there’s no need to wait until tomorrow’s issue to come out – let’s close here and lock in big gains. We bought the calls at around $ 0.60, so if we close at $ 1.50, we are earning 150% profits on the trade.

Closing trade details can be found below.

Trade Details:

July 22, 2022 - 4:15 pm

Insiders,

The weekly recap video is up.

Here’s the link:

https://cdn.jwplayer.com/videos/gX0MssVj-Bvib7p4n.mp4

July 22, 2022 - 3:12 pm

Insiders,

It’s time for a new TWTR trade! Earnings came out today and the stock price barely budged. Why? Because it’s likely in a holding pattern while we wait for a potential Musk settlement or other related news (the court case is set for October). We’re going to bet that the stock will remain in the same narrow range for another week. For this strategy, we’ll use a put butterfly.

I am recommending we buy the TWTR July 29th 36-38-40 put butterfly for about 42 cents (net debit). That’s also the max loss on the trade if we finish outside of our butterfly range (36-40). Max gain is at 38 on July 29th and is roughly 1.58 in profits. Breakeven points are 36.42 and 39.58. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (38) strike and buy one of each of the wings (36 and 40). There isn’t really a substitute for this trade because it’s essentially market neutral.

Order Details:

July 22, 2022 - 2:47 pm

Insiders,

Order Details:

July 19, 2022 - 3:25 pm

Insiders,

I’m on Stock Charts TV after the close today. Check it out if you get the chance!

July 18, 2022 - 2:58 pm

Insiders,

Here’s what I’m looking at for the week of July 18th:

We’re back to earnings season with lots of big names reporting this week including: BAC, GS, JNJ, IBM, NFLX, and of course, TSLA.
June housing starts, building permits, and existing home sales data will help shed light on the rapidly cooling housing market.
The ECB has a rate decision to make on Thursday. Will it be a leading indicator of what to expect from the Fed the following week?

July 15, 2022 - 4:46 pm

Insiders,

Our weekly video is ready for viewing.

Check it out here:

https://cdn.jwplayer.com/videos/61BFhQnV-Bvib7p4n.mp4

July 15, 2022 - 2:41 pm

Insiders,

We have two positions expiring today, and it appears (barring some crazy last minute surge) that both will expire for zero. TWTR was undone by Musk pulling out of the deal. RBLX is up 6% today, but the mid-week dip from the bad CPI print means we got too far away from our call fly strikes to catch up. I probably should have used a two-week butterfly, but I didn’t like how wide the bid/ask spreads were for the July 22nd expiration. We’ll put on a new trade next week, possibly something in the natural gas space (which will make Chris Lopez happy).

July 14, 2022 - 6:18 pm

Insiders,

I had the opportunity to record a podcast this week on The Derivative with Jeff Malec. Check it out!

@jsoloff brings an exciting twist to The Derivative, where he covers calls and charting curves with @AttainCap2. Plus, we get into what it takes to be a Kansas City sports fan. Check it out here: https://t.co/W3vPtcKc1B pic.twitter.com/ZVYz1eSXj9

— RCM Alternatives (@rcmAlts) July 14, 2022

July 11, 2022 - 9:50 pm

Insiders,

The Options Floor Trader Pro trade for tomorrow is in the regional banking space. We are buying the Regions Financial (RF) August 19th 20 call for around 60 cents with a buying range up to 1.00.

Trade Details:

July 11, 2022 - 2:01 pm

Insiders,

Here’s what I’m looking at for the week of July 11th:

It’s a busy week for news, headlined by CPI on Wednesday. The CPI number could be a major driver for what the Fed does with rates at the end of July (at the FOMC meeting).
Earnings kick off this week with a handful of major banks reporting on Thursday and Friday.
Retails sales and consumer sentiment numbers will also come out later in the week, providing an update on economic health.

July 8, 2022 - 4:13 pm

Insiders,

Our weekly video recap is ready for viewing.

Here’s the link:

https://cdn.jwplayer.com/videos/lnURncV8-Bvib7p4n.mp4

July 8, 2022 - 2:21 pm

Insiders,

We’re still waiting to see if any TWTR news comes out before expiration next week which will benefit our call spread. In the meantime, I’ve been watching Roblox (RBLX) lately. While analysts don’t love the stock, the short-term options action has been very bullish. We’re going to try to tap into that by making a one-week call butterfly trade.

I am recommending we buy the RBLX July 15th 42-45-48 call butterfly for about 55 cents (net debit). That’s also the max loss on the trade if we finish outside of our butterfly range (42-48). Max gain is at 45 on July 15th and is roughly 2.45 in profits. Breakeven points are 42.55 and 47.45. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (45) strike and buy one of each of the wings (42 and 48). As a substitute for this trade, you can do a vertical (buy a call spread) or straight up buy calls, but in both cases the trades will cost quite a bit more in premium.

Order Details:

July 4, 2022 - 4:08 pm

Insiders,

Here’s what I’m looking at for the week of July 4th:

It’s a short week with the market closed on Monday. This also is traditionally a lower volume week as it’s prime vacation time for many families.
We do have the June jobs number this week. Will it back up the mostly anecdotal evidence that hiring is slowing and unemployment is rising?
FOMC minutes from June will give us a clearer pictures of what the Fed is thinking in terms of rates and the economy.

July 1, 2022 - 4:42 pm

Insiders,

Our weekly recap video is ready for viewing. Here’s the link:

https://cdn.jwplayer.com/videos/lWko2xxd-Bvib7p4n.mp4

Enjoy the holiday weekend!

June 30, 2022 - 1:14 pm

Insiders,

Closing Trade Alert:

A higher injection of gas into storage sent natural gas prices plunging today. That means holding our United States Natural Gas Fund (UNG) put an extra couple days is going to pay off nicely for us. Let’s close the trade here for around $ 2.70 (or wherever mid-market is when you get this notice). We paid $ 1.05 initially for the put, so profits will be around $ 1.65 or 157% gains.

Closing trade details can be found below.

Trade Details:

June 27, 2022 - 5:41 pm

Insiders,

For tomorrow’s Options Floor Trader Pro issue, we are buying MGM Resorts International (MGM) July 15th 31 calls for around 97 cents, with a buying range up to 1.75.

Trade Details:

June 27, 2022 - 3:39 pm

Insiders,

Here’s what I’m looking at for the week of June 27th:

This coming week is all about economic indicators. We kicked off the week with durable goods orders and pending home sales – both which showed the economy is still doing okay, despite fears of a recession
The most important indicator for this week is probably PCE (on Thursday), which is an important gauge of inflation. Spending and income data will also be released on the same day
PMI is also worth keeping an eye on (Thursday), as it shows the strength of the manufactured goods market

June 24, 2022 - 4:09 pm

Insiders,

The Insiders weekly video is up. Here’s the link:

https://cdn.jwplayer.com/videos/gMmLuqkR-Bvib7p4n.mp4

June 24, 2022 - 3:01 pm

Insiders,

It’s late in the day, but I really want to get us in an Insider trade before the weekend, so here it is! I was planning on doing another call butterfly, but I actually found this trade to be appealing as a straight call spread. For this trade, we’re going back to Twitter (TWTR).

It seems increasingly possible that Elon Musk will purchase TWTR. While it may not be at the original asking, it will certainly be higher than where we are now. As such, we’re going to buy a three-week call spread (your broker may call it a vertical spread) that will reach max gain if the stock goes to 43 or higher by July 15th. The call spread (buying the July 15th 40 and selling to open the July 15th 43 call simultaneously) will cost a bit over 1.00. That means our breakeven is around 41. Max gain is around 2.00. We lose the premium spent (max loss) if the stock is under 40 at expiration. See the details below if you’re not familiar with placing a call spread. If you can’t trade spreads, buying the 40 call straight up is a decent replacement (albeit more expensive).

Trade Details:

June 20, 2022 - 5:11 pm

After a 3-day weekend, the markets reopen on June 21st. Here’s what I’m looking at for the week ahead:

Oil prices have been a primary driver of inflation concerns. We saw a small pullback last week in crude prices. Will the pullback continue this week?
Existing and new home sales will give us an idea if soaring mortgage rates are making a difference in the real estate world.
Inflation data for both the UK and Japan come out this week. Keep in mind, inflation is not just an issue in the US.

June 17, 2022 - 4:25 pm

Insiders,

The weekly recap video is up. Here’s the link:

https://cdn.jwplayer.com/videos/QtAM981q-Bvib7p4n.mp4

June 17, 2022 - 2:37 pm

Insiders,

Regarding a couple trades we have expiring today:

Our TLT call butterfly was undone by the Fed’s 75 basis point rate increase. When I recommended the trade, the market still had expected a 50 point hike. TLT has bounced back a little, but not enough to help our butterfly. You can just let all the legs expire.
Our NKLA puts almost were worth closing out, but the market stabilized late this week. I considered those puts as basically a hedge against a massive selloff, and they would have paid off had we kept going down. Ultimately, I imagine most of us are happy that the market stopped selling off (for now). No action is needed, as we’ll let these puts expire.

June 13, 2022 - 5:26 pm

Insiders,

Fresh off the success from our FCX value/mean reversion trade, we’re going to try a similar position in Intel (INTC) this week. We’re buying the INTC July 8th 39 call for 1.00, with a buying range up to 1.75.

Trade Details:

June 13, 2022 - 4:29 pm

Insiders,

Here’s what I’m looking at for the week of June 13th:

Well, it’s going to be an interesting week. The market is down 4% on Monday to kick things off and we are officially in bear market territory. Even energy stocks are down. CPI coming in higher than expected (last Friday) is the catalyst behind the selloff, and that’s primarily due to oil prices. We’ll definitely want to keep an eye on oil this week.
The big event this week is the FOMC meeting. Will the Fed raise rates by 50 bps on Wednesday as expected? Will it be 75 bps instead? Will they talk about increasing the pace of hikes due to the latest CPI results? A lot is riding on this meeting. It’s the most important one we’ve had in a while.
On top of the Fed data, we also have retail sales (consumer strength) and PPI (producer price levels) results coming out this week.

June 10, 2022 - 4:08 pm

Insiders,

Another crazy day in the markets. I talk about it and our open positions in the weekly video recap.

Here’s the link:

https://cdn.jwplayer.com/videos/LhsqXoEH-Bvib7p4n.mp4

June 9, 2022 - 2:44 pm

Insiders,

We have an important CPI number coming out tomorrow. I believe it will show what the experts expect – a slight easing in inflation. Barring a major surprise, this should result in iShares 20+ Year Treasury Bond ETF (TLT) staying rangebound between roughly 115 and 120. That’s a great opportunity for us to use a short-term TLT call butterfly (that expires in a week).

The June 17th 115-117-119 call butterfly, will cost about 40 cents (net debit). That’s also the max loss on the trade if we finish outside of our butterfly range (115-119). Max gain is at 117 on June 17th and is roughly 1.60 in profits. Breakeven points are 115.40 and 118.60. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (117) strike and buy one of each of the wings (115 and 119). As a substitute for this trade, you can do a vertical (buy a call spread) or straight up buy calls, but in both cases the trades will cost quite a bit more in premium.

Order Details:

June 6, 2022 - 3:03 pm

Insiders,

Here’s what I’m looking at for the week of June 6th:

It’s a slow week in term of expected releases. There are basically no major earnings announcements and the key economic numbers don’t come out until Friday. However, the markets will certainly be watching oil, which recently hit 0 a barrel.
Despite the slow week, one of the economic numbers that comes out Friday is probably the most important one to watch these days: CPI. Investors expect a decline in CPI, which means inflation is lessening. A bigger than expected drop would be good for stocks (most likely).
The other Friday economic number is consumer sentiment, which can be an important forward looking stat regarding economic growth. We’ll get a chance to see how consumers feel about the economy under the strain of inflation.

June 6, 2022 - 1:55 pm

Insiders,

Shares in Freeport-McMoRan (FCX) jumped higher today, which gives us the move we needed to exit for a nice profit. While FCX may continue moving higher, we haven’t had a big win in a while and we are long overdue to take some profits. Let’s close the trade here. We bought the calls at around $ 1.13, so if we close at $ 2.28, we are earning 102% profits on the trade.

Closing trade details can be found below.

Trade Details:

June 3, 2022 - 4:29 pm

Insiders,

The latest weekly recap video is up.

Here’s the link:

https://cdn.jwplayer.com/videos/qhXlvhOG-Bvib7p4n.mp4

June 3, 2022 - 2:35 pm

Insiders,

For the moment, no action is necessary for the TGT call butterfly. If we get a late rally in the next hour to get to 165, then I’ll send out a closing trade. However, as things currently stand, it looks like we’ll just let it expire. We may jump right back into a similar trade next week using slightly lower strikes

May 30, 2022 - 5:41 pm

Insiders,

Our new Options Floor Trader Pro trade tomorrow will be buying calls on copper giant, Freeport-McMoRan (FCX). We are buying the June 24th 42 calls for around 1.13 with a buying range up to 2.00.

Check out the issue if you’re looking for more color on why I chose this trade. Also, be sure to read Euan’s column!

Trade Details:

May 30, 2022 - 3:04 pm

Insiders,

Here is what I’m looking at for the week of May 30th:

There are only four trading days this week with the market closed today for Memorial Day. We are also entering the summer season, which means there is often less volume/action in stocks.
The biggest event this week is non-farm payrolls for May coming out on Friday. The jobs number can sometimes move the market if it’s a surprise result.
Non-manufacturing PMI also comes out on Friday, but the results will likely be drowned out by the payroll number.
Earnings season is over, but a few big companies do report this week like CRM and AVGO. Day traders may be interested in the GME earnings.

May 27, 2022 - 3:40 pm

Insiders,

Not a bad rebound week for stocks ahead of the three-day weekend. I talk about it in more detail in the weekly recap video.

Here’s the link:

https://cdn.jwplayer.com/videos/IZzkgu3c-Bvib7p4n.mp4

May 27, 2022 - 2:30 pm

Insiders,

We got the move we were looking for in INTC. Our call butterfly isn’t a huge winner, but it is a winner, so let’s close now.

In order to close, we’ll need to do two separate trades, as seen below. You have to close the short side first, so we’ll buy back (buy to close) the 46 calls for a penny. Then we’ll sell to close the 43.5 call for as high as possible. Try to get at least 82 cents on the closing price and adjust as needed.

At the current price, we’ll get a credit of around 80 cents on the fly, which we bought for 70 cents. That’s a 14% winner. Remember you have to buy to close the short leg (46 calls) before selling out the long call (43.5).

Trade Details:

May 26, 2022 - 3:07 pm

Insiders,

I’ve been waiting for Target (TGT) to stabilize after its massive selloff last week. The stock got hit ridiculously hard and is due for some level of mean reversion. We’re going to use a short-term (one week) call butterfly in anticipation of some recovery in the TGT share price.

The June 3rd 165-170-175 call butterfly, will cost about 90 cents (net debit). That’s also the max loss on the trade if we finish outside of our butterfly range (165-175). Max gain is at 170 on June 3rd and is roughly 4.10 in profits. Breakeven points are 165.90 and 174.10. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (170) strike and buy one of each of the wings (165 and 175). As a substitute for this trade, you can do a vertical (buy a call spread) or straight up buy calls, but in both cases the trades will cost quite a bit more in premium.

Order Details:

May 23, 2022 - 3:06 pm

Insiders,

Here is what I’m looking at for the week of May 23rd:

Most of the earnings and key economic numbers have come out in the previous few weeks, so now we get see how the market reacts without that many potential catalysts. Inflation remains the primary focus of the investment community.
Of the remaining earnings this week, NVDA, ZM, and COST are three of the most important reporting. One thing to watch for is if retail stores can halt their slide after last week.
On the economic front, housing and consumer spending data will help clarify the inflation picture.

May 20, 2022 - 4:42 pm

Insiders,

Another volatile week is in the books. Check out the latest weekly recap video for my insights.

Here’s the link:

https://cdn.jwplayer.com/videos/Fdc4vCXt-Bvib7p4n.mp4

May 16, 2022 - 5:23 pm

Insiders,

We have new put trade in NKLA for tomorrow and we’re adding a July put trade in UNG. For NKLA we are buying the June 17th 5 puts for around 56 cents. The buying range is up to 1.00. For UNG, we’re buying the July 1st 22 put for around 1.05 with a buying range at your discretion.

Trade Details:

May 16, 2022 - 1:10 pm

Insiders,

Here’s what I’m looking at for the week of May 16th:

We finally saw a big up day for stocks on Friday, can we get a carry through this week? So far today, we’re mostly flat.
Retail sales come out on Tuesday and will give us a clue how inflation is impacting consumer spending.
Earnings continue this week with some big retail names including TGT, WMT, and HD.
The CPI for Europe and the UK will be released, helping to paint a picture of how inflation is impacting some key overseas economies.

May 13, 2022 - 4:12 pm

Insiders,

The weekly recap video is ready for viewing.

Link:

https://cdn.jwplayer.com/videos/pjD91ENx-Bvib7p4n.mp4

May 13, 2022 - 1:35 pm

Insiders,

Is the market rebounding? It’s too early to tell, but there are some stocks that are definitely too cheap right now. Intel (INTC) is one of them. I like the idea of using a call butterfly with INTC because it isn’t the type of stock to blow through a range in a hurry. Plus, we’ve had some nice wins with butterflies this year. We’ll go out two weeks on this next one.

The May 27th 43.5-46-48.5 call butterfly, will cost about 70 cents. That’s also the max loss on the trade if we finish outside of our butterfly range (43.5-48.5). Max gain is at 46 on May 27th and is roughly 1.80 in profits. Breakeven points are 44.20 and 47.80. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (46) strike and buy one of each of the wings (43.5 and 48.5). As a substitute for this trade, you can do a vertical (buy a call spread) or straight up buy calls, but in both cases the trades will cost quite a bit more in premium.

Order Details:

May 6, 2022 - 4:35 pm

Insiders,

The weekly recap video is ready for viewing.

Here’s the link:

https://cdn.jwplayer.com/videos/SXs0PAns-Bvib7p4n.mp4

May 6, 2022 - 3:24 pm

Insiders,

No new trades just yet. It’s not at all apparent what will happen on Monday. I equally expect a massive rally or a crash, which means the market will probably be flat. I want to trade volatility directly (via the ETFs), but there’s no obvious trade right now. Let’s hold tight for the time being and we’ll get back to trading next week.

Also, the weekly recap video should be out within the hour.

May 5, 2022 - 3:32 pm

Insiders,

I’m definitely not alone when I say I didn’t see the market puking today (industry jargon for a steep selloff). I assumed after yesterday, we were in for smooth sailing, at least until the CPI number next week. The biggest surprise to me is actually TLT, which plunged to 115 (our call butterfly is obviously not going to work). That being said, the VIX and the VIX futures term structure are not showing panic. You can see below, 10-day realized volatility is way higher than the VIX itself and the futures (blue line). Moreover, the VIX is implying 2% daily moves in the S&P500 and we’re at over 4% right now as I type this. So either this steep selloff is going to be very short-lived, or the VIX is wrong and will be in a very different place in a couple days. We’re going to wait to see what things look like tomorrow and then make an Insiders trade based on what the VIX is doing. Stay tuned. Also, don’t panic. These days happen. Stocks will eventually recover (bonds, not so much). There could be some very lucrative volatility-based trades in the meantime.

May 2, 2022 - 6:05 pm

Insiders,

We’re going back to the well and buying calls in Cleveland-Cliffs (CLF). Buy the May 27th 28 calls for around 1.05 with a buying range up to 2.00.

Trade Details:

May 2, 2022 - 4:36 pm

Insiders,

Here’s what I’m looking for the week of May 2nd:

After a rough opening, the markets recovered on Monday on what should be a very eventful week in terms of news and earnings.
Above all, the FOMC meeting concludes on Wednesday and we’ll find out how much of a rate hike we’ll get plus we should get a better idea of what the expected path of rate hikes will be this year.
We also have April non-farm payrolls, durable goods, and PMI reports this week.
And let’s not forget, it’s still earnings season. Some big names that report this week are PFE, AMD, SBUX, ABNB, and COP.

April 29, 2022 - 4:31 pm

Insiders,

Rough close to the week. I talk about that and much more in our weekly recap video.

Here’s the link:

https://cdn.jwplayer.com/videos/axYGIyIQ-Bvib7p4n.mp4

April 28, 2022 - 3:02 pm

Insiders,

Fresh off the success of our TWTR butterfly, let’s try out another call butterfly. This time we’re going to focus on a bit more neutral version of the strategy as we wade into the world of Treasury bonds. The iShares 20+ Year Treasury Bond ETF (TLT) has fallen over 18% year-to-date on anticipation of aggressive Fed hiking. I believe it will level out for a time, maybe even climb a little, after the Fed meeting next week – especially after the much worse than expected GDP number today. So, we’re going to do TLT call butterfly that expires next Friday (with the FOMC announcement on Wednesday).

The May 6th 120-123-126 call butterfly, will cost about 75 cents. That’s also the max loss on the trade if we finish outside of our butterfly range (120-126). Max gain is at 123 on May 6th and is roughly 2.25 in profits. Breakeven points are 120.75 and 125.25. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (123) strike and buy one of each of the wings (120 and 126). As a substitute for this trade, you can do a vertical (buy a call spread) or straight up buy calls, but in both cases the trades will cost quite a bit more in premium.

Order Details:

April 25, 2022 - 3:48 pm

Insiders,

Here’s what I’m looking at for the week of April 25th:

Although not as important as the macro issues, the market is currently fixated on Elon Musk buying Twitter for billion. It seems like the deal will go through, with TWTR going private.
The market dropped the most in one day last Friday since 2020 as investors have become overly concerned with the potential pace of rate hikes. Will stocks rebound once the news is digested?
It’s the biggest earnings week of the season with AMZN, AAPL, GOOG, and FB all reporting, among many others.
First quarter GDP comes out on Thursday, although it’s a very backward looking metric.

April 25, 2022 - 3:28 pm

Insiders,

Our TWTR butterfly worked out way faster than I expected. Twitter announced that it is being purchased by Elon Musk for $ 54.20. The stock is right around $ 52 as investors are dealing with a bit of uncertainty over the situation. That gives us an opportunity to get out for $ 2.40, although the price is moving around quickly. See below for closing details

There are two ways to close a butterfly. First, I recommend trying to close the entire butterfly as seen in the order details screenshot below. It’s simply a reverse of how the trade was opened. You may need to let it sit in the market for a bit before it gets filled. If that doesn’t seem to be working, then try the second method. That is, you’ll buy to close the middle strike (52 calls) first. Then you can sell out the 48 and 54 calls as a separate transactions.

We paid $ 0.60 for the call butterfly, so if we close at $ 2.40, we are making 300% profits. This is why I love butterflies.

Order Details:

April 22, 2022 - 4:44 pm

Insiders,

The weekly recap video is ready for viewing.

Here’s the link:

https://cdn.jwplayer.com/videos/Pib15RR7-Bvib7p4n.mp4

April 20, 2022 - 2:25 pm

Insiders,

I’m not seeing anything in the VIX complex to trade, so in honor of 4/20 we’re going to make a fun trade on Twitter (TWTR). Earnings are next week, plus we have all the Elon Musk acquisition news happening, so there could be plenty of upside potential in the share price. This call butterfly will expire a week from Friday, which covers the earnings period. In addition, we should have more clarity on the Musk bid by then.

The April 29thth 48-52-56 call butterfly, will cost about 60 cents. That’s also the max loss on the trade if we finish outside of our butterfly range (48-56). Max gain is at 52 on April 29th and is roughly 3.40 in profits. Breakeven points are 48.60 and 55.40. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (52) strike and buy one of each of the wings (48 and 56). As a substitute for this trade, you can do a vertical (buy a call spread) or straight up buy calls, but in both cases the trades will cost quite a bit more in premium.

Order Details:

April 18, 2022 - 3:04 pm

Insiders,

I’m trying to get the trades coming out in the issue tomorrow to you before market close today so we can avoid a potential repeat of what happened last time with SBUX. There are three new trades this time. A new put trade in UNG, a bonus call trade in VALE (to make up for missing SBUX), and a new trade in PINS (our current trade expires Friday).

We are buying the United States Natural Gas Fund (UNG) May 20th 24 puts for around 1.22. Buy up to 2.00.

Details:

We are buying the Vale (VALE) May 20th 19.5 calls for around 90 cents. Buy up to 1.35

Trade Details:

We are buying the Pinterest (PINS) May 6th 24 calls for around 92 cents. No set buy up to price (personal discretion).

Trade Details:

April 18, 2022 - 1:05 pm

Insiders,

Here’s what I’m looking at for the week of April 18th:

The week is off to a slow start with stocks basically flat and volatility ticking up just a bit. Most of the expected news this week will be earnings related.
Speaking of earnings, it’s the first real week of reporting for the latest quarterly results. Big names with earnings this week include, NFLX, BAC, PG, JNJ, and TSLA.
From an economics data standpoint, we’ll get a lot of housings news throughout the week.

April 15, 2022 - 2:57 pm

Insiders,

The weekly recap video is ready for viewing.

Here’s the link:

https://cdn.jwplayer.com/videos/IDThOqtI-Bvib7p4n.mp4

April 14, 2022 - 3:42 pm

Insiders,

VXX is still hanging around $ 25, so it looks like no action will be needed on our put butterfly. You can let it expire with no action needed prior to close today. We’ll likely place a similar trade next week assuming nothing drastic changes over the long weekend.

April 14, 2022 - 1:51 pm

Insiders,

We only need to close our VXX put butterfly if VXX drops below 24.50. However, I still think there’s a decent chance that happens by the end of the day. In other words, the closing alert is probably going to have to come in last hour of trading. If you don’t think you’ll be around to trade then, it may be best to close the trade now. Once again, the easiest way to close a put butterfly is to buy back the short middle strike (the 22.5 puts) and then close the long top strike (the 24.5 put) in a separate transaction.

April 12, 2022 - 1:24 pm

Insiders,

I’ve been waiting for our TSN call butterfly to be priced above $ 3.00, and we’re finally there. Let’s close the position here for a profit.

There are two ways to close a butterfly. First, I recommend trying to close the entire butterfly as seen in the order details screenshot below. It’s simply a reverse of how the trade was opened. You may need to let it sit in the market for a while before it gets filled. If that doesn’t seem to be working, then try the second method. That is, you’ll buy to close the middle strike (92.5 calls) first. Then you can sell out the 87.5 call as a separate transaction. You can choose to close the 97.5 call or just let it expire (depending on whether it’s worth anything at that point).

We paid $ 1.05 for the call butterfly, so if we close at $ 3.10, we are making 195% profits. Butterflies can be a hassle at times to trade, but results like this show why I really like to use them.

Order Details:

April 12, 2022 - 11:55 am

Insiders,

Shares in Commercial Metals (CMC) jumped higher today, which gives us the move we needed to exit for a profit. While there’s certainly a possibility the stock will continue climbing, we are up against expiration on Thursday (the market is closed on Friday). That means time decay is in full effect. Let’s close here and take our profits off the table. We bought the calls at around $ 1.30, so if we close at $ 1.55, we are earning 19% profits on the trade.

Closing trade details can be found below.

Trade Details:

April 11, 2022 - 4:30 pm

Insiders,

Here’s what I’m looking at for the week of April 11th:

Don’t forget the market is closed 4/15, so expiration is on Thursday 4/14. Despite being a short week, there’s going to be a substantial amount of action in terms of economic data and earnings.
The most important economic number these days is CPI. This key measure of inflation comes out tomorrow and could set the tone for what the Fed is going to do next. An unexpected change (in either direction) could certainly move the markets.
Another important economic number, retail sales, comes out on Thursday. Consumer spending data can give us an idea of how much inflation is impacting spending patterns.
Finally, it’s the start of a new earnings season (already). This week we’ll see the earnings reports of several major financial institutions, including most of the largest banks.

April 8, 2022 - 4:48 pm

Insiders,

The weekly recap video is now available.

Here’s the link:

https://cdn.jwplayer.com/videos/e0bEPZuK-Bvib7p4n.mp4

April 5, 2022 - 1:13 pm

Insiders,

With the VIX futures terms structure back in steep contango (almost 9% slope upward from the front month to the second month), I believe it is time for us to place another one of our VXX put butterfly trades. These have traditionally been solid trades for us, and the price is right for a 4-strike spread that expires a week from Friday.

The April 14th 20.5-22.5-24.5 put butterfly, will cost about 50 cents. That’s also the max loss on the trade if we finish outside of our butterfly range (20.50 – 24.50). There’s very little risk we drop below 20, so the real risk is that we move higher. Max gain is at 22.50 on Friday the 14th, and is roughly 1.50 in profits. Breakeven points are 21 and 24. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (22.5) strike and buy one of each of the wings (20.5 and 24.5). As a substitute for this trade, you can do a vertical (buy a put spread) or straight up buy puts, but in both cases the trades will cost quite a bit more in premium.

Order Details:

April 4, 2022 - 6:11 pm

Insiders,

We’re finally doing a put trade in the Options Floor Trader Pro issue tomorrow! We are buying the Starbucks (SBUX) April 29th 85 put for around 1.30 with a buying range up to 1.90. Details below.

Trade Details:

April 4, 2022 - 3:27 pm

Insiders,

Before we get to what I’m watching for this week, I want to remind you that we have a fantastic webinar with Euan Sinclair planned for tomorrow. He’ll be discussing how to trade (or not trade) during a high volatility environment. It’s a really good presentation and Euan is donating the proceeds (just to attend the webinar) to Ukrainian refugees.

Here’s the signup link:

https://bit.ly/highvolmarkets

Okay, here’s what I’m looking at for the week of April 4th:

It’s a slow ‘planned’ news week, but there are plenty of newsworthy events that could impact the markets at a macro level. These include the war in Ukraine, the inverted Treasury yield curve (which I’m not overly concerned about), general inflation worries, the price of oil, etc.
Speaking of inflation, we have non-manufacturing PMI coming out this week which adds yet another data point to the mix.
There is also the FOMC meeting notes release on Wednesday, which sometimes can spook (or help) the market.
Musk’s 9% stake in TWTR sent the stock price soaring. Could it be a turnaround week for social media stocks?

April 1, 2022 - 4:21 pm

Insiders,

The weekly video recap is up. Here’s the link:

https://cdn.jwplayer.com/videos/E9EBXZI7-Bvib7p4n.mp4

March 28, 2022 - 3:38 pm

Insiders,

Here is what I’m looking at for the week of March 28th:

Is there a potential for a ceasefire between Ukraine and Russia? Markets could get a big boost if the fighting stops, but it does not seem imminent.
The Fed is projected to raise rates 6 more times this year. That would bring us to a Fed Funds rate of around 2%. Is there economic news that could slow the pace of hikes? Conversely, is there anything that may cause those hikes to be 50 bps instead of 25 bps? That being said, PCE comes out this week and is one way the Fed likes to measure inflation.
March jobs data comes out on Friday and could potentially be a market mover if it surprises (higher or lower).
It’s not earnings season, but Micron (MU) does report this week and could shed some light on the current state of semiconductor supply issues.

March 25, 2022 - 4:26 pm

Insiders,

We’re back to our normal schedule, so here’s the link to the weekly recap video:

https://cdn.jwplayer.com/videos/psrtWraS-Bvib7p4n.mp4

March 24, 2022 - 3:12 pm

Insiders,

Okay, let’s close our GM call spread for profits. If you’ve never closed a spread before, make it look like the order form below. If it seems challenging to get filled at or around 1.35, you can always buy to close the short 46 call first and then sell to close the 43 call afterwards. That’s a perfectly reasonable alternative to closing the spread all at once. We paid 85 cents for the call spread, so if we close at 1.35, we’ve made profits of 59%.

Closing Order Details:

March 24, 2022 - 1:57 pm

Insiders,

We have the GM call spread to close for a profit (likely later today), but for now, let’s add a new trade. Commodities-related stocks have been a tear, so when I saw that Tyson Foods (TSN) was lagging, it jumped out as a potential trade opportunity. We’re going to use a call butterfly strategy to bet on a rebound in the stock over the next 3 weeks.

The April 14th 87.5-92.5-97.5 call butterfly, will cost about 1.05. That’s also the max loss on the trade if we finish outside of our butterfly range (87.5-97.5). Max gain is at 92.50 on April 14th and is roughly 3.95 in profits. Breakeven points are 88.55 and 96.45. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (92.5) strike and buy one of each of the wings (87.5 and 97.5). As a substitute for this trade, you can do a vertical (buy a call spread) or straight up buy calls, but in both cases the trades will cost quite a bit more in premium.

Order Details:

March 21, 2022 - 7:10 pm

Insiders,

The monthly webinar for Options Insiders members that would normally take place this Thursday is rescheduled to next week: Thursday, March 31, 2022 starting at 8:00 p.m. eastern. You can use the same link for the new date: https://us02web.zoom.us/j/851872273

Thanks!

March 21, 2022 - 7:04 pm

Insiders,

We have two trades in the Options Floor Trader Pro issue for tomorrow. We are opening up an April 22nd 27 call in Pinterest (PINS) for around 1.20 with a buying range up to 1.75. We are also buying Ford (F) May 20th 18 calls for around 68 cents (buying range at your discretion). See details below.

Trade Details:

March 21, 2022 - 3:27 pm

Insiders,

Here is what I’m looking at for the week of March 21st:

Stocks finally rebounded last week after the Fed only raised rates by 25 basis points. Will the rally hold or was it just a brief respite?
The VIX remains elevated at around 25, but the futures curve is back in contango. That’s generally a sign that there’s less uncertainty among investors. Let’s see how the VX curve shape changes over this next week.
New home sales and consumer sentiment data come out this week and are worth keeping an eye on.

March 20, 2022 - 4:03 pm

Insiders,

I’m back from vacation and in the process of catching up. Here’s the recap video for last week (and what we’ll be looking at this week):

https://cdn.jwplayer.com/videos/bpCFEFSR-Bvib7p4n.mp4

March 10, 2022 - 6:22 pm

Insiders,

I’ll bet travelling tomorrow, so I’m sending out the weekly recap video a day early.

Here’s the link:

https://cdn.jwplayer.com/videos/pbwgJePl-Bvib7p4n.mp4

March 8, 2022 - 1:44 pm

Insiders,

I’m not yet ready to pull the trigger on a VXX trade, so let’s change gears and find a solid value play. Automotive companies have gotten wrecked recently, in part due to supply costs spiking. However, there’s a point where enough is enough. There’s only so low automakers can go before they are too good to pass up Normally I’d recommend Ford (F) here, but we’re going to switch it up a bit and buy a call spread in General Motors (GM).

We’re going to buy the the March 25th 43-46 call spread for around 85 cents. If you’ve never made a call spread trade before, just make it look like the order form below. Your broker may also label it as a vertical spread or bull call spread. You can do the legs separately as long as you buy the 43 calls before selling (to open) the 46 calls. If you can’t trade spreads, buying the 43 calls alone is a reasonable substitute. Our max risk is the cost of the spread (85 cents). Max gain is 2.15 if GM is at or above 46 at expiration.

Order Details:

March 7, 2022 - 4:31 pm

Insiders,

For our new OFT Pro trade tomorrow, we’ll be going with a lesser-known US steel company called Commercial Metals Company (CMC). We are buying the April 14th 42 calls for around 1.30, with a buy up to range to 1.90. See trade details below.

Order details:

March 7, 2022 - 2:37 pm

Insiders,

Here’s what I’m looking at for the week of March 7th:

All eyes are on the Ukraine-Russia war and its disruption of global markets. VIX is at about 35, which shows extreme concern among investors, and implies over 2% moves per day in equites.
Commodities are dominating the market news, especially oil, which briefly hit $ 130 per barrel. Wheat continues to be limit up nearly every day. Gold is at $ 2,000 an ounce. Even nickel is up 65% today. Assume massive volatility going forward across most commodities.
As if all that isn’t enough, the CPI number comes out on Thursday. CPI has become the most important economic number this year as it’s our best reading of inflation. It’s hard to expect more volatility than we already have, but Thursday could be an interesting day.

March 4, 2022 - 4:11 pm

Insiders,

The weekly video recap is ready for viewing.

Here’s the link:

https://cdn.jwplayer.com/videos/6Spy1ay8-Bvib7p4n.mp4

March 4, 2022 - 3:06 pm

Insiders,

Regarding our VXX put butterfly, the one thing we didn’t want to happen was a big spike in volatility on expiration day. Clearly, I didn’t anticipate the shelling of a nuclear power plant as a reason to send VXX much higher. Although, there’s a reason why volatility is high during wartime. The put butterfly will expire out of the money, so no action is necessary if you haven’t closed it already. We will put on a similar trade next week as I think the the thesis is good and we just had bad luck with timing this week.

March 4, 2022 - 2:47 pm

Insiders,

With crude oil’s price skyrocketing in recent days, our calls in Magnolia Oil & Gas (MGY) are doing very well. We still have a two weeks left on this trade, but I expect the price of oil to remain volatile. I think it’s a good time to take profits. My buy price was $ 1.20, but I know many of you got a much lower price for your entry points. Using my entry price of $ 1.20 cents, if we close at $ 1.80, we are looking at gains of 50%.

Closing trade details can be found below.

Order Details:

March 3, 2022 - 2:08 pm

Insiders,

Quick update for the VXX put butterfly:

We’re up about 40% right now on the trade, but I think it makes sense to hold until tomorrow, as VXX may drop closer to $ 23. I’ll send out closing details tomorrow, but whether you choose to close today or tomorrow, it will be much easier to close the position by doing it in two stages. First, you’ll want to buy back the short 23 puts (which are trading for about 5 cents now). Then, you’ll sell out the 26 put. No action is necessary on the 20 put. Closing in two steps is generally the best way to get the most favorable price

March 3, 2022 - 2:00 pm

Insiders,

Rocket Companies (RKT) has been a run higher since earnings last week. The stock is likely to selloff though once the ex-dividend date hits next week. Let’s go ahead and close here and capture our profits. My buy price was 86 cents, but I know many of you got a much lower price for your entry points. Using my entry price of 86 cents, if we close at $ 1.48, we are looking at gains of 56%.

Closing trade details can be found below.

Order Details:

February 28, 2022 - 4:02 pm

Insiders,

Here’s what I’m looking at for the week of February 28th:

The war in Ukraine is clearly the primary focus of the financial markets right now. Currency, commodities, and bond markets share the volatility of the equity markets given the financial/economic sanctions that are hitting Russia. There’s a lot going on across the board.
The VIX is at 30 with the futures curve in backwardation. The front month future is at 29. Market volatility is telling us to be safe. Hedging is expensive, but may help you sleep at night over the next few weeks.
The job number for February will come out on Friday. Jobs data has taken a backseat to inflation numbers (like CPI), but still could be a market mover (depending on what is going on in Ukraine).
Interesting earnings this week include Zoom, Salesforce, Target, and AMC.

February 25, 2022 - 1:26 pm

Insiders,

The weekly recap is dropping a bit early today. Here’s the link:

https://cdn.jwplayer.com/videos/X0zFhjHc-Bvib7p4n.mp4

February 24, 2022 - 11:31 am

Insiders,

Well, 2022 hasn’t been boring, that’s for sure. Is the Russia invasion finally going to get stocks to bottom out? Only time will tell, but it sure looks to me like volatility is peaking here Front month VIX futures have stalled at about 32 (which implies 2% moves in the market per day). I think it’s time to unleash another one of our famous VXX put butterflies. We can pay a bit over a dollar for a 6-dollar-wide put fly expiring next week.

The March 4th 26-23-20 put butterfly, will cost about 1.05. That’s also the max loss on the trade if we finish outside of our butterfly range (20-26). There’s almost no risk we drop below 20, so the real risk is that we move higher. Max gain is at 23 next Friday and is roughly 1.95 in profits. Breakeven points are 21.05 and 24.95. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (23) strike and buy one of each of the wings (20 and 26). As a substitute for this trade, you can do a vertical (buy a put spread) or straight up buy puts, but in both cases the trades will cost quite a bit more in premium.

Order Details:

February 21, 2022 - 4:32 pm

Insiders,

What I’m looking at for the week of February 21st:

The market is closed today for Presidents Day, but futures are down with expectations of yet another volatile week. The Ukraine/Russia conflict is driving the fear at the moment, with the VIX term structure in clear backwardation.
Let’s not forget about inflation and the economy. PMI and consumer confidence both come out this week and will provide more data points for our consideration.
There are some important earnings this week, although earnings season is about over with. Big names for this week include HD, EBAY, and SQ.

February 21, 2022 - 4:23 pm

Insiders,

Although the market is closed today, we still have a new Options Floor Trader Pro trade coming out tomorrow. We are buying Rocket Companies (RKT) March 25th 13 calls for around 86 cents, with a buy up to range of 1.30. We are also buying another Ford (F) call – the March 25th 19 call for around 69 cents (buy up to at your discretion). Trade Details for both can be found below.

Trade Details:

February 21, 2022 - 4:17 pm

Insiders,

I’m doing a webinar for Market Chameleon tonight at 6pm ET on the State of Volatility in 2022. If you want to check it out, here’s the link to register:

https://us02web.zoom.us/webinar/register/WN_q9ELZ7ioQxW6GsIwUUuS5A?utm_source=MarketChameleon+Users&utm_campaign=3f5ee632a9-EMAIL_CAMPAIGN_2020_04_17_05_48_COPY_08&utm_medium=email&utm_term=0_2fdd6113a5-3f5ee632a9-24458063

Or you can catch the webinar live on their YouTube channel:

https://www.youtube.com/channel/UCltMZFhZDjCZYKsRT4Y2I-w

February 18, 2022 - 4:27 pm

Insiders,

Our weekly recap video is now available for viewing.

Here’s the link:

https://cdn.jwplayer.com/videos/1r3hon4n-Bvib7p4n.mp4

February 18, 2022 - 3:11 pm

Insiders,

Just a quick note that no action is necessary on the TWTR butterfly. We’ll let it expire for zero as the market has not been cooperating this week. Also no action on DBX (for the same reasons). We’ll have a new trade in OFT Pro and Insiders next week (and I’m pretty sure I’ll stay away from tech in both situations).

February 14, 2022 - 5:35 pm

Insiders,

I’ll be on The Final Bar tomorrow. Check it out if you get a chance! David runs a great show.

February 14, 2022 - 2:50 pm

Insiders,

Here’s what I’m looking at for the week of February 14th:

CPI came in hot at 7.5% last week, will the Fed need to act sooner than expected to raise rates? The market will have to digest the situation this week, along with the release of PPI on Tuesday.
The threat of Russian invading Ukraine is not going away. Can Russia be talked into backing down? If not, what will the impact on the market be? As long as the VIX is over 30, the market assumes the threat is very real.
Plenty of earnings are coming out on top of the macro event risk. These include NVDA, CSCO, WMT, ABNB, and many others.
FOMC minutes may provide some insight into what the Fed is thinking about inflationary pressures.

February 11, 2022 - 3:52 pm

Insiders,

The weekly video is up. Here’s the link:

https://cdn.jwplayer.com/videos/zjBWJHBI-Bvib7p4n.mp4

February 8, 2022 - 12:15 pm

Insiders,

After you place that TWTR trade, you can go ahead and close the CLF vertical spread. With CPI coming up this week, the market could be on the move. Just in case, let’s lock in our profits. We paid about 78 cents for the spread and we can close here for 2.00. That’s 1.22 in profits or 156% gains. See closing details below.

Trade Details:

February 8, 2022 - 12:06 pm

Insiders,

Our recent butterfly trades have worked out well, so let’s try out a call butterfly earnings play in Twitter (TWTR). TWTR has earnings on Thursday, and the stock has been in a major downtrend. However, SNAP earnings show that maybe social media isn’t so down and out after all. We’re using a butterfly that expires next week to give us a full week after earnings for the move to play out. (We’re betting on a positive move after earnings

It’s an 8-strike wide call butterfly (37-41-45), so it will cost us about 68 cents. That’s also the max loss on the trade if we finish outside of our butterfly range (37-45). Max gain is at 41 next Friday and is roughly 3.32 in profits. Breakeven points are 37.68 and 44.32. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (41) strike and buy one of each of the wings (37 and 45). As a substitute for this trade, you can do a vertical (bullish call spread) or straight up buy calls, but in both cases the trades will cost quite a bit more in premium.

Trade Details:

February 7, 2022 - 4:05 pm

Insiders,

Our new trade in the OFT Pro issue tomorrow is buying calls in a lesser known Oil & Gas E&P company called Magnolia Oil & Gas (MGY). We are buying the March 18th 22.50 calls for around $ 1.50. Buying range is up to $ 2.00 The bid/ask spread is quite wide, so don’t be afraid to try out a limit order near mid-market at first.

Here’s the trade:

February 7, 2022 - 1:25 pm

Insiders,

Here’s what I’m looking at for the week of February 7th:

Will Russia invade Ukraine? This is the elephant in the room in terms of uncertainty. The situation is most directly tied to the energy markets but could spill over into other sectors or the market as a whole.
Very big CPI number coming out on Thursday. Will inflation finally start to subside?
Consumer sentiment is also set to be released this week and provides yet another economic data point.
Earnings are still rolling out this week with some big names like Disney and Pfizer and some trendy companies such as Uber and Coinbase.

February 4, 2022 - 4:16 pm

Insiders,

The weekly video recap is up. Here’s the link:

https://cdn.jwplayer.com/videos/WCPDWI6R-Bvib7p4n.mp4

January 31, 2022 - 3:26 pm

Insiders,

Here’s what I’m looking at for the week of January 31st:

Another busy week in the market ahead – the VIX is around 25 as I write this, so are finally going to get some stability (and maybe even a rally)?
Major earnings this week which could be market movers include Amazon, Alphabet, Meta Platforms, and PayPal
January non-farm payrolls hit at the end of the week and will definitely be watched closely by investors
And just in case that isn’t enough, non-manufacturing PMI drops on Thursday

January 28, 2022 - 3:54 pm

Insiders,

Our last weekly video for the month of January is now available for viewing.

Here’s the link:

https://cdn.jwplayer.com/videos/RjQKxB5V-Bvib7p4n.mp4

January 28, 2022 - 12:31 pm

Insiders,

With all this market volatility, it’s been difficult to find entry points for trades. Nevertheless, I believe there are some “low hanging fruit” opportunities given the excessive selling going on lately. I believe the F trade we did in OFT Pro is one of those opportunities. For Insiders, I believe I found another attractive opportunity in Cleveland-Cliffs (CLF). Steel companies have sold off sharply the past couple weeks, but the US Steel (X) earnings shows that the industry is extremely optimistic about the coming year. CLF earnings come out February 11th, so we’ll buy a call spread that expires the following week to give us a bit more time for a post-earnings reaction (if needed).

We are buying the February 18th 17 calls and selling to open the February 18th 20 calls. The total net debit should be around 78 cents. That’s our max loss on the trade if CLF is below $ 17 on Feb 18th expiration. Max gain is $ 2.22 if CLF is above $ 20 at expiration. You can do the trade all at once as a vertical spread or bull call spread as seen below. Or you can do it in separate transactions as long as you buy the 17 calls before you sell to open the 20 calls. Buying the 17 calls by themselves is a reasonable proxy if you can’t trade spreads in your options account.

Details:

January 24, 2022 - 4:19 pm

Insiders,

We’re going to use this pullback as an opportunity to grab Ford (F) calls. Let’s buy the February 25th 21.50 calls for around 1.04. Buy the call up to 1.60.

Details:

January 24, 2022 - 12:48 pm

Insiders,

Here’s what I’m looking at for the week of January 24th:

The market continues to take a beating with all the major indices down at least 3% to start the week. The Nasdaq 100 is firmly in correction territory, down nearly 15% for the year. Will we find a bottom this week?
The VIX is in full backwardation (6% as I type this). It’s a clear sign of a defensive market. We’ll need to see the VX futures move back to contango before the market will be at ease.
The first Fed meeting of 2022 happens on Wednesday. It’s suddenly a much bigger deal than previously thought. We’ll see if the Fed changes their timetable on QE/QT and rate hikes. Will the market selloff sway any opinions on the FOMC?
On top of everything, it’s a huge earnings week. AAPL, MSFT, TSLA, and INTC are just a few of the major names that will be reporting this week.

January 24, 2022 - 12:25 pm

Insiders,

The market selloff continues, especially in tech. The Nasdaq-100 is down nearly 15% year-t0-date. I believe we’ll find a bottom this week, possibly before the Fed meeting on Wednesday. Regardless, the VIX curve is now in backwardation, as seen below. For the moment, the market is in full-on defensive mode. It’s been a fairly orderly selloff in stocks, so it doesn’t seem like panic. We should be able to use this opportunity to find some bargains, starting tomorrow with the Options Floor Trader Pro trade. I’ll send out the pick to Insiders later today.

January 21, 2022 - 4:59 pm

Insiders,

My recap video got cut off after SNAP, but that was basically near the end of it. I just mention after that we rolled out DBX this week. DBX won’t expire until February 18th and that includes the next earnings call.

Next week we’ll have a new OFT Pro trade and potentially one or two Insider trades, especially if the market stabilizes. Stay tuned and have a great weekend!

January 21, 2022 - 4:41 pm

Insiders,

It’s been a rough week for stocks, but that just means there should be some excellent buy-low opportunities – possibly as early as next week. I talk about our current positions and more in the video recap linked below.

https://cdn.jwplayer.com/videos/ksxmTEec-Bvib7p4n.mp4

January 21, 2022 - 12:56 pm

Insiders,

I was hoping to roll out the January International Paper (IP) calls. However, the market selloff over the last couple of days means our 50 calls will expire for zero. That being said, I still like the thesis behind this trade and believe it just needs more time.

As such, we will buy February calls today. No action is necessary on the January calls (you can let them expire). For those who didn’t make the original IP trade, you can use this opportunity to enter the trade. See trade details below. The February 18^th 50 calls should cost around 65 cents.

Trade Details:

January 20, 2022 - 2:28 pm

Insiders,

We’re rolling out our DBX calls to February. (I’m looking at tomorrow for rolling out IP.) See trade details below for DBX. If don’t have a DBX position and want to open one, now would be a good time (by purchasing the February calls).

Trade Details:

January 17, 2022 - 2:03 pm

Insiders,

Here’s what I’m looking at for the week of January 17th:

It’s short week with the markets closed today for MLK day. With the VIX still above 19, the next 4 days could be interesting
Earnings week kicks off in earnest this week, with big names such as NFLX, PG, BAC, and UNH
Key housing data is set to come out with both housing starts and existing home sales on the schedule for the week

January 14, 2022 - 4:44 pm

Insiders,

Our weekly video recap is now up.

Here’s the link:

https://cdn.jwplayer.com/videos/5ZCXlSDw-Bvib7p4n.mp4

January 13, 2022 - 3:05 pm

Insiders,

The market has been pretty choppy, so it’s difficult to guess what tomorrow may bring for volatility and VXX. Since we can get out of our put butterfly here for around 50 cents, I think it’s a good time to take profits rather than wait until expiration day tomorrow. Closing at 50 cents equates to 67% gains on the trade. Just make sure your closing order looks like the one below. If for some reason you have trouble getting filled, you can try closing the short strike first and then the long strikes.

Trade Details:

January 13, 2022 - 2:41 pm

Insiders,

We’re finally ready to close GLNG. Closing price should be around 1.50. That’s 275% gains if you just made the last trade in GLNG and about 11% if you made both trades to date in the stock.

Trade Details:

January 10, 2022 - 4:42 pm

Insiders,

We kick off 2022 in Options Floor Trader Pro with a call purchase in Snap (SNAP). We’re buying the January 28th 45 call for around 0.95 with a buy up to range to 1.50.

Trade Details:

January 10, 2022 - 2:50 pm

Insiders,

Here’s what I’m looking at for the week of January 10th:

A hawkish Fed has spooked the market, especially tech stocks. Will the slide in tech stocks finally slow or stop this week?
The VIX is back over 20, but VX futures haven’t move all that much. We’ll definitely want to pay attention to this dynamic as the week progresses.
CPI and PPI come out Wednesday and Thursday respectively. It could be a big week for inflation expectations based on these reports, especially CPI.
Earnings season kicks off this week with the big banks starting to report on Friday.

January 7, 2022 - 3:25 pm

Insiders,

The weekly recap video is now available. Here’s the link:

https://cdn.jwplayer.com/videos/mphwHx8k-Bvib7p4n.mp4

January 7, 2022 - 12:38 pm

Insiders,

Back by popular demand, it’s the VXX put butterfly! This time around, we’ll be doing a straight put butterfly that expires next Friday. We’re taking advantage of the steep contango in the VIX term structure along with having a 3-day weekend at the end of next week. It’s a 2 strike wide put butterfly (19-18-17), so it will only cost us about 30 cents. That’s also the max loss on the trade if we finish outside of our butterfly range (17-19). Max gain is at 18 next Friday and is roughly 70 cents. Breakeven points are 17.30 and 18.70. If you’ve never done a butterfly trade before, make it look like the order form below – just make sure you are selling two of the middle (18) strike and buy one of each of the wings (17 and 19). There isn’t a great substitute for this trade if you can’t trade spreads since the 19 put is quite expensive on its own.

Trade Details:

January 5, 2022 - 1:52 pm

Insiders,

Let’s close the US Steel (X) trade from OFT Pro for a winner. We’re looking at around 140% gains if we close at the current price.

Trade Details:

January 3, 2022 - 5:13 pm

Last Chance to Sign Up for Tomorrow’s Training Session

Just one last reminder to sign up for the live training session that I’m running tomorrow night with Euan Sinclair. It’s on finding and correcting mistakes in your directional trades to maximize your profits. Euan is one of the top experts in options trading and options education. If you’re not familiar with Euan yet, you should be. He’s one of the foremost experts and his ideas can help take so-so trading to high probability wins.

The training session starts tomorrow night at 8:00 p.m. eastern and all registrants will receive a link with the replay in case you can’t make that time or sit in for the full presentation. Use this link for more details and to sign up:

https://yn345.infusionsoft.com/app/orderForms/OFT-Getting-the-Most-From-Your-Directional-Trades

January 3, 2022 - 12:16 pm

Insiders,

Here’s what I’m looking at for the week of January 3rd:

As expected, Omicron cases are soaring after the holidays, with some school closures occurring. Will the cases peak in January? With Omicron being more contagious but (generally) less severe, are we finally approaching an end to the pandemic?
With the retail spending season over with, we should start to get a clearer picture of how inflation looks. Is there anything that could move up the Fed’s rate hike timeline?
Stocks have started the year off on a positive note. Will the positive momentum hold or are we more likely to experience reversion to the mean?

December 31, 2021 - 4:27 pm

Insiders,

Last recap of the year! Here’s the link:

https://cdn.jwplayer.com/videos/Sl9fwKD7-Bvib7p4n.mp4

Happy New Year!

December 29, 2021 - 2:47 pm

Insiders,

I’m not ready to make a VXX trade yet, I’d like to see it spike before buying puts. Also, I want to see TWTR’s share price stabilize before doing another call butterfly. So for today, we’re going to do something a bit different and relatively low risk. Medallion Financial (MFIN) is a credit services company that helps finance taxi cab medallions. Given the popularity of ride-sharing, this company has seen its profits erode for multiple years. So, the CEO decided the best way to boost the stock price was securities fraud! (He basically paid for all kinds of positive articles and comments on the company.) The stock is down 26% today but I think it’s on its way to penny stock territory. We’re going to buy the January 5 puts. I think 50 cents is a bargain given the circumstances.

Trade Details:

December 27, 2021 - 4:09 pm

Insiders,

For our new trade tomorrow, we are buying the January 21st 12.50 call in CleanSpark (CLSK) for $ 1.15, with a buy range up to $ 1.75. CLSK is a bitcoin mining company.

Trade details are found below.

December 27, 2021 - 1:20 pm

Insiders,

What I’m looking at for the week of December 27th:

The week between Xmas and New Year’s is traditionally slow for the markets, with little in the way of news or events.
Given the slow week, will stocks continue to rally into 2022?
Will retail numbers from the holiday season start to emerge? Will they be better or worse than expected?
The one negative on the horizon is all the holiday get-togethers could spike COVID numbers, especially with how contagious Omicron is. The number of cases should peak by mid-January. Will that be the end of the “variant run” (hopefully)? How will the market react?

December 24, 2021 - 3:49 pm

Insiders,

Our weekly recap for the short holiday week is ready for viewing. Here’s the link:

https://cdn.jwplayer.com/videos/RhTVeY6j-Bvib7p4n.mp4

Happy Holidays!

December 23, 2021 - 2:47 pm

Insiders,

I think it’s late enough in the day that we can safely assume TWTR won’t cross above 45 (which is the bottom strike of our call butterfly). That means no action is necessary and we can let the butterfly expire. I do still think a TWTR butterfly could pay off nicely for us in the next few weeks, so it’s very possible we’ll enter a similar trade next week. Also – although the market is closed tomorrow, I’ll still be sending out a recap video, so keep an eye out for that (if you’re not too busy celebrating with the family of course).

December 23, 2021 - 11:48 am

Insiders,

VXX has done exactly what we hoped for today, so let’s close our broken wing butterfly and take profits. Butterflies can be challenging to close at times, especially when one of the strikes has no value (the 17 puts). So, we are going to close in two separate trades. Often times, you can get a better closing price this way. The only trick to closing in two transaction is you have the close the short puts first (buy them back) then close the long puts (or your broker will get angry). You can let the 17 puts expire (no action needed) .

So first, we’ll buy to close the 19.50 puts as seen below.

Next, we’ll sell to close the 21 put, as seen below.

Between the two trades, we should make around $ 1.00 overall. We paid around 45 cents for the full position last week, so that’s about 60 cents profit or 133% gains.

December 20, 2021 - 2:21 pm

Insiders,

What I’m looking at for the week of December 20th:

It’s a short week with the market closed on Friday for Xmas – options expiration is Thursday.
The market has started the week off with a decent-sized selloff due in part due to Omicron spread. Will this be another Delta scenario? Or will the markets brush it off more quickly?
Personal income and spending for November comes out this week. Will the economy continue to show strength in the face of higher inflation?
Regarding the economy, new homes sales for November will be released on Thursday – yet another important measure of economic growth.

December 17, 2021 - 4:25 pm

Insiders,

The weekly recap video is up.

Here’s the link:

https://cdn.jwplayer.com/videos/0RmjrSXx-Bvib7p4n.mp4

December 15, 2021 - 3:21 pm

Insiders,

The market seems to be good with the Fed announcement (faster taper, faster time table on rate hikes in 2022) so we have a couple trades to make. In the interest of time since the market is closing soon, I’m going to keep this post relatively short – so if you’re new to trading butterflies, just make sure your trade looks like the entry screenshots below. There’s a closing trade in SPY and a new VXX trade below.

First off, we’ll close the SPY put butterfly hedge. We can still get about 35% of our premium back if we close it here, so that’s the first trade. Make sure you are selling/buying to close and setting net credit for your limit order.

Closing SPY Details:

Next, let’s set up a broken wing butterfly in VXX. I expect volatility to continue fading by the end of next week, but there’s a floor on how far it will fall. It makes for a good opportunity to use the broken wing structure on a put butterfly. I’ve attached the payoff chart below if you’re not sure how a broken wing fly works. There isn’t really a good replacement for this trade as the ATM puts are too expensive to buy on their own.

VXX Broken Wing Butterfly Details:

Payout graph for the VXX trade:

December 13, 2021 - 4:35 pm

Insiders,

We have three trades for tomorrow in the OFT Pro issue. The new trade is in US Steel (X). We are buying the January 21st 24 call for around $ 0.93 with a buy up to range of $ 1.35. While the DBX and GLNG trades for December will expire for zero (no action needed), we are opening up January positions in both of them. You can find the details of all three trades below.

Trade Details:

December 13, 2021 - 12:47 pm

Insiders,

What I’m looking at for the week of December 13^th:

The week is starting off with meme stocks getting crushed. Will this trend continue or is this a buying opportunity?
The latest Fed rate decision will come out after the FOMC meeting concludes on Wednesday. Rates almost certainly won’t be changed, but the timeline for tapering could be made more clear (along with the timing on the next rate hike)
Retails sales will be released on Wednesday and provide yet another important data point regarding the strength of the economy (and the impact of inflation)

December 10, 2021 - 3:39 pm

Insiders,

The weekly video recap is up.

Here’s the link:

https://cdn.jwplayer.com/videos/nVdNCR5i-Bvib7p4n.mp4

December 6, 2021 - 4:02 pm

Insiders,

Here’s what I’m looking at for the week of December 6th:

The S&P 500 dropped about 2.5% over the last month, about half of that drop coming last week. It’s up around a 1% today, so is the selling finally going to abate?
The VIX is elevated (above the futures) but the VIX futures curve is in contango. Something has to give. Will volatility normalize this week?
Earnings season is over but Oracle (ORCL) is one mega cap company that reports this week and is worth keeping an eye.
The biggest event of the week is the CPI release on Friday. Will it show elevated levels of inflation? The market will be closely watching this number.

December 3, 2021 - 4:26 pm

Insiders,

It was quite the volatile week. We look at the market and its elevated volatility, along with our open positions, in the video below.

Here’s the link:

https://cdn.jwplayer.com/videos/SaVDf1jT-Bvib7p4n.mp4

December 2, 2021 - 12:38 pm

Insiders,

The market warning signs are still flashing based on the metrics I look it. The VIX and SPY skew levels in particular are very elevated. We need some downside protection in case of a more severe pullback. With SPY options prices so high, the only way to hedge on the cheap is via a put butterfly. For those who can’t trade butterflies, unfortunately there’s no good way to replicate the trade below. You can buy SPY puts straight up, but they will cost you a lot. For those who can do the trade, the details are below. We’re going two weeks out because I believe if a correction is going to happen it will be sooner rather than later.

Remember, you can only lose what you spend on the fly (around $ 55 per fly in this case). Max gain is at 442 ($ 745 per fly), but anything between 449.45 and 434.55 will be profitable. Make sure your order entry looks like the one below, with the buy 1/sell 2/buy 1 format. It should be relatively easy to get filled on this trade with how tight SPY options trade.

Trade Details:

December 1, 2021 - 6:18 pm

Insiders,

The VIX is over 30 and the market looks pretty scary right now. I want to see what the rest of the the week looks like, but it may be time to throw on a SPY put spread or some kind of hedge. VIX spot (green line) is way above the futures (blue line), which is what happens when downside hedging is in demand. Also, the flat futures curve is also a sign of risk off. We’ll see what tomorrow brings.

November 30, 2021 - 2:46 pm

Insiders,

We haven’t made a butterfly trade for a while, but current market conditions are conducive to that strategy (expensive options). Twitter (TWTR) is getting a new CEO. I think this will be bullish for the stock (once the market is done selling off) because the company has struggled to monetize the product and a change at the top is overdue. We’re going to use a call butterfly to try to capture the upside range.

If you’ve never done a butterfly before, I show the trade details below for the December 23rd 45-49-53 call butterfly. If you can’t make spread trades, you can just buy the December 23rd 45 calls. It’s not the same thing as a butterfly, but it’s about as close as you’ll be able to get. For those making the butterfly trade, the most you can lose is the amount paid (in this case, around 75 cents). Max gain is at 3.25 at the center strike of 49 (at expiration), but hitting max gain is unlikely. We are looking to finish in the profit range between 45.75 and 52.25 Remember for the center strike, you are selling 2 to open (or double the number contracts). Also be sure you are using net debit for you limit order. It’s okay if you have to pay the ask price if you can’t get filled at a mid-market price.

November 29, 2021 - 4:13 pm

Insiders,

The new trade in the OFT Pro issues tomorrow is in International Paper (IP). We are buying the January 21st 50 calls for around 90 cents, with a buying range up to around 1.30. See trade details below.

Trade Details:

November 29, 2021 - 1:40 pm

Insiders,

Here’s what I’m looking at for the week of November 29th:

The omicron variant spooked the markets on Friday but we should be getting more info on the seriousness of this new variant this week
The November employment report drops on Friday. Jobs numbers can be big market movers if they are deemed a surprise
Black Friday and Cyber Monday data should start to be available this week and will shed some light on retail spending/consumer demand for the holiday season
Earnings season is mostly over, but Salesforce.com (CRM) is one of the remaining tech giants to post earnings (tomorrow)

November 26, 2021 - 2:49 pm

Insiders,

Quite the selloff today, but remember, it’s in a low liquidity environment. I talk more about it in the weekly recap video linked below.

https://cdn.jwplayer.com/videos/o9zyhtIA-Bvib7p4n.mp4

November 22, 2021 - 1:52 pm

Insiders,

Here’s what I’m looking at for the week of November 22nd:

It’s a short week so volume/activity will likely be dampened, especially after Tuesday
Zoom (ZM) earnings come out after close today and could paint an interesting picture about the WFH/return to office environment
How will the market (bonds in particular) continue to react after the re-upping of Powell to Fed Chair?
Deere & Co (DE) earnings will give us some insight into the agricultural commodities market, which is meaningful given food price inflation this year

November 19, 2021 - 4:18 pm

Insiders,

The weekly video is ready for viewing. Here’s the link:

https://cdn.jwplayer.com/videos/i0scltU7-Bvib7p4n.mp4

November 18, 2021 - 1:20 pm

Insiders,

Let’s add another call spread to our portfolio. Victoria’s Secret posted earnings today and posted better than expected sales. The news has provided a spark to apparel retailers. One clothing company that could be due for a rebound is The Gap (GPS). The stock hasn’t performed well this past quarter, but earnings are due next week and could be set to surprise. As such, we’ll buy a call spread that expires next week, after earnings.

We are buying the 25-28 call spread expiring November 26th for around 89 cents. If you’ve never made a call spread before, make it look like the order form below. Your broker may also call it a vertical spread. If you can’t trade spreads, you can approximate this trade by buying the 25 call by itself. The most we can lose on this trade is the price of the spread (89 cents), while max gain is 2.11 if the stock is at 28 or above a week from Friday. The breakeven point is 25.89 at expiration.

Trade Details:

November 17, 2021 - 12:55 pm

Insiders,

Cleary it was a mistake on my part to not close LYFT when it jumped to 56 the week we made the trade. The stock has now dropped all the way down to 49. That being said, I think the stock price will remain range-bound, which gives us another entry point for a call spread. So, here are the steps we are going to take:

Make a new trade buying a 51-54 call spread that expires on December 3rd. I offer a couple alternatives to this trade below.
Do nothing for the time being on the November 19th spread because it currently has little to no value. However, if the stock rallies before Friday, we may be able to still close it for something. I’ll keep you posted, but currently no action is necessary as the spread will expire entirely out of the money.

For the new trade, it will cost around 70 cents. That means the breakeven on both spreads combined will be around 1.75. If you didn’t make the first LYFT trade, you can definitely get into the new trade shown below. If you don’t mind spending a bit more and want to increase your upside, the 50-54 call spread costs about 1.05 (so it will cost 35 cents more to place the trade but have 65 cents more profit potential). For the 51-54 call spread our max loss is 70 cents or whatever you pay for the spread, while max gain is 2.30 (not including the money spent on the first trade). If you can’t trade spreads in your account it’s okay to just buy the 51 call straight up as a reasonable proxy.

Trade Details:

November 15, 2021 - 4:17 pm

Insiders,

A couple things:

First, we have a new trade in OFT Pro tomorrow. We are buying Dropbox (DBX) December 17th 27 calls for around 90 cents. Buy up to range is 1.35 or so. See trade details below.

Second, I’m going to start putting out a weekly watchlist on Mondays for important/interesting things I’ll be keeping an eye in the coming week. Here’s the first list for the week of November 15th:

Retails Sales: Is Inflation impacting consumer spending? This key economic report will help shed a light on the situation.
Walmart and Target Earnings: Like the point above, consumer spending is in focus this week and these two are the biggest retail chains.
NVDA Earnings: The largest GPU maker should be able to tell us what the chip shortage looks like these days. Plus, the company is one of the bigger components of the Nasdaq-100.

Trade Details:

November 12, 2021 - 4:26 pm

Insiders,

The weekly recap video is up. Here’s the link:

https://cdn.jwplayer.com/videos/hBNGhixV-Bvib7p4n.mp4

November 11, 2021 - 5:04 pm

The replay of the training webinar on how to set up trades so you can get the same edge and odds of winning as Wall Street is now online. Click here to watch.

November 10, 2021 - 11:18 am

Insiders,

Holding GOLD a bit longer paid off as the stock priced jumped another 4% today. We bought the calls for roughly $CONTENT.54. Today, we can sell them out for around .64. That’s a gain of 204%. Let’s lock in those profits now.

Closing trade details can be found below.

Trade Details:

November 5, 2021 - 4:02 pm

Insiders,

The weekly video recap is up. Here’s the link:

https://cdn.jwplayer.com/videos/YBwLC2o2-Bvib7p4n.mp4

November 5, 2021 - 12:10 pm

Insiders,

We have no positions on right now after closing MU, so let’s not waste any time. We’re going to get right back into another call spread, this time in LYFT. Both LYFT and UBER are rebounding sharply as ride sharing is showing strong signs of recovering from the pandemic. I believe LYFT has more room to run, so we’re going to place a short-term call spread on a continued rally in the stock. For those of you who can’t trade spreads, you can just buy the (53) call instead.

We are buying the November 19th 53-56 call spread for around $ 1.05. That’s the most we can lose on the trade. Max gain is $ 1.95 if the stock closes above 56 at expiration. Make sure you make the trade look like the order screen below if you are new to spreads. Your broker may call it a vertical spread, a call spread, or a bull call spread. This is a net debit trade as we are paying out money when we make the trade.

Trade Details:

November 5, 2021 - 11:43 am

Insiders,

Not going to mess around with MU like I did with GLW. We are way up on the trade, so let’s close it here. We bought the 69-73 call spread expiring November 19th for around $ 1.10. We can close it here for about $ 2.82. That’s 156% profits. Sounds good to me!

I show how to close the call spread below. Just make sure you are selling to close the 69 call and buying to close the 73 call. It’s also a net credit trade since we are getting money back and not paying it out.

Trade Details:

November 3, 2021 - 4:58 pm

Insiders,

The FOMC meeting results came out today and they were basically in line with expectations. Bond “tapering” (reduced buying of bonds) will start at $ 15 billion per month in November and another $ 15 billion in December. Currently the Fed is buying around $ 120 billion worth of Treasuries and Mortgage backed securities each month. They still consider most of the higher inflation metrics to be transitory based on supply chain bottlenecks (that is, they’ll eventually be resolved). Powell did say that he expects the economy to adjust but it’s uncertain what the impact on inflation will be (and how long transitory inflation will last).

November 2, 2021 - 11:23 am

Insiders,

Apologies for not sending the text alert for the OFT Pro trades yesterday. However, it worked out somewhat since we are now changing the CSCO trade. We no longer need to do a rollout since CSCO gapped up today. Instead, just close the 56 call and don’t worry about buying the 57 call. You should be able to close CSCO for around $ 1.45. The trade details are below. I also included updated pricing for the GOLD call, which is now about 48 cents to buy.

Trade Details:

October 29, 2021 - 4:17 pm

Insiders,

The weekly video is up. Here’s the link:

https://cdn.jwplayer.com/videos/vgkGeVlp-Bvib7p4n.mp4

October 29, 2021 - 3:40 pm

Insiders,

Just a reminder that no action is necessary if you are still holding the GLW call spread. It will expire OTM.

October 25, 2021 - 12:37 pm

Insiders,

We bought CLF calls with the expectation that earnings (based on higher demand for steel) would give the stock price a boost. That’s exactly what happened – and then some. On Tuesday we bought the calls for around $ 1.25. Less than a week later, they are worth .30. That’s a gain of 164%. Let’s lock in those profits in now.

Closing trade details can be found below.

Trade Details:

October 22, 2021 - 4:23 pm

Insiders,

The weekly video recap is now up.

Here’s the link:

https://cdn.jwplayer.com/videos/Bw6xnZvq-Bvib7p4n.mp4

October 22, 2021 - 2:53 pm

Insiders,

Getting close to the weekend bell, but I wanted to squeeze in an Insiders trade. We are buying a call spread in Micron (MU). The memory chip company is investing $ 150 billion to boost chip demand. The stock has been trending lower, but I believe it has the potential to rebound over the next month. We are going to use a call spread, as seen below. For those new to call spreads, your broker may call them vertical spreads or call spreads or bull call spreads. Just make sure it looks like the screenshot below. You can only lose what you spend on the trade (around $ 1.10). Max gain is at $ 73 or above at expiration and is around $ 2.90.

Trade Details:

October 18, 2021 - 5:08 pm

Insiders,

For our new trade tomorrow in the OFT Pro issue, we’re buying the November 26th 22.50 calls in steel giant Cleveland-Cliffs (CLF). I have the price at $ 1.25 right now, with a buy up to $ 1.65. Trade details are below.

Details:

October 15, 2021 - 4:15 pm

Insiders,

The weekly video recap is ready for viewing. Here’s the link:

https://cdn.jwplayer.com/videos/Iggd3Ges-Bvib7p4n.mp4

October 14, 2021 - 2:26 pm

Insiders,

Sorry about the small image in the last post. Here’s a much larger version:

October 14, 2021 - 1:53 pm

Insiders,

We are rolling out our CSCO calls while they still have some value. See trade details below:

October 8, 2021 - 4:25 pm

Insiders,

The new weekly recap video is up. Here’s the link:

https://cdn.jwplayer.com/videos/TJQPM2Px-Bvib7p4n.mp4

October 6, 2021 - 2:47 pm

Insiders,

We’re not yet ready to place a short market volatility trade (VXX puts), but we have something we can do in the meantime. Corning (GLW) has earnings coming up at the end of the month, but despite that, the calls are very inexpensive. We’re going to buy a small call spread in anticipation of a pre-earnings rally. Remember, you can only lose what you spend on the trade (in this case, around $ 55). Max gain is with the stock price at 39 or higher at expiration, and is roughly $ 145.

The trade details can be found below (be sure you use buy to open and sell to open on the options, and that the limit order is set to net debit).

Trade Details:

October 4, 2021 - 5:02 pm

Insiders,

We have a new trade coming out in the OFT Pro tomorrow, which is buying calls on GLNG, a liquefied natural gas infrastructure company. Specifically, we are buying the December 17th GLNG 15 calls for around 95 cents. We are also closing our AU calls for a profit. See trade details below.

Trade Details:

October 1, 2021 - 4:31 pm

Insiders,

The market was kind of sketchy this week so we didn’t add a new Insiders trade, but we certainly will have a new trade next week. There’s also the new OFT Pro trade coming out on Tuesday. In the meantime, here’s the weekly video recap:

https://cdn.jwplayer.com/videos/nJwY9rnH-Bvib7p4n.mp4

September 28, 2021 - 4:46 pm

Insiders,

Last chance to sign up for Euan Sinclair’s webinar tonight on calendar effects on options trading. I’ve seen the slides and it’s intriguing stuff!

Here’s the link if you’re interested:

https://yn345.infusionsoft.app/app/orderForms/OFT-Finding-An-Edge-In-Options-Trading-Using-Calendar-Effects?a=3944&utm_campaign=oftwbrpa&utm_source=oiticker&utm_medium=sponsor&t=oftwebsprcamowbpdoitkr090121

September 28, 2021 - 3:20 pm

Insiders,

Just a heads up – I’m looking at another VXX trade, but I want to make sure we don’t have a sustained selloff first. Depending on what the market is doing tomorrow, we may jump into a VXX put trade (put spread or butterfly most likely) as early as tomorrow.

September 24, 2021 - 4:22 pm

Insiders,

The weekly video recap is up. Here’s the link:

https://cdn.jwplayer.com/videos/8Lo5LOWd-Bvib7p4n.mp4

September 23, 2021 - 3:24 pm

Insiders,

Let’s close the long 26.50 put portion of our broken-wing butterfly. We closed (bought back) the 25 puts on Monday for 7 cents. So, if we sell out the 26.50 puts for around 1.27, we will have made around 50 cents on the total position. You can let the 24 put expire as it’s only worth about a penny. Assuming you got filled at 60-65 cents on the original trade, we’re looing at profits of around 75-80% on this position in total. It’s also a great example of why sometimes legging into or out of trades (one piece at a time) can be useful for more complex strategies.

Trade Details:

September 23, 2021 - 12:15 pm

Insiders,

Just a quick reminder that Euan Sinclair is doing a premium webinar next Tuesday called “Finding an Edge In Options Trading Using Calendar Effects”. I expect it to be his usual fascinating stuff. It’s only to attend (and get the recording). I’ll be hosting so I hope to see you there if you can make it!

Here’s the link to the order page:

September 23, 2021 - 11:47 am

Insiders,

MRO has bounced back as anticipated. The 11.50 call has gone from around 59 cents to 1.31 in just over two days. That’s a 122% gain. Let’s go ahead and lock in those profits.

Trade Details:

September 20, 2021 - 3:44 pm

Insiders,

I’m going to try to squeak these trades in before market close because prices are likely to change by tomorrow. We have two new trades coming out in the OFT Pro issue – one regular trade (CSCO) and one from the ongoing Options Masterclass (MRO). To save time, I’m just going to post the two orders below. The buy up to price on the CSCO call is $ 1.30 and for the MRO call it’s $ 0.95.

Trade Details:

September 20, 2021 - 1:02 pm

Insiders,

The jump in VXX is providing us with the opportunity to actively manage the broken-wing butterfly we made last week. Thanks to Howard for the suggestion, we are going to close the middle strike of the position since those 25 puts have lost most of their value. That leaves us straight long the 26.50 puts (and the 24 puts), which is not a bad place to be. I don’t think this volatility spike will last.

All you have to do in terms of actions is buy to close the 25 puts as seen in the trade details below.

Trade details:

September 17, 2021 - 4:25 pm

Insiders,

A lot going on towards the end of this week – so take a look at the weekly recap if you get a chance. Here’s the link:

https://cdn.jwplayer.com/videos/TviqRlaq-Bvib7p4n.mp4

September 17, 2021 - 1:23 pm

Insiders,

We’re opening up a new AU trade as the September 16 calls will expire OTM today. Here’s the note I’m sending out via email:

Gold has continued to sell off and it has taken AU down with it. I strongly believe this is a temporary thing and AU will rebound within the next few weeks. The bad news is our 16 calls will expire worthless today. The good news is, we can buy the October 15^th 15 calls quite cheaply here. I still think AU makes a run at , so there’s plenty of profit opportunity left.

Let’s make a new call trade on AU.

We’re buying the October 15^th 15 calls for around 55 cents. See trade details below. No action is necessary on the 16 calls that expires today.

September 17, 2021 - 1:09 pm

Insiders,

As fortune would have it, the stock dropped while I was typing up the closing trade that just got sent. You now may be able to get 70-80 cents net credit. Here’s a more updated screenshot. (You may still need to close it pieces for optimal pricing).

September 17, 2021 - 1:05 pm

Insiders,

Let’s close the ADM call butterfly here as a small winner. I’m sending this a bit earlier than I intended because closing the trade may take a bit of maneuvering and/or time. First off, here’s what the closing trade should look like if you’re trying to close it all at once:

We’re going to try to close it for around 60 cents. If you bought the butterfly for around 40-45 cents, is is roughly a 33% winner. First off, I’d try to close the whole thing at 60 cents (net credit), and maybe let it sit out there for 10-15 minutes. Then you can either try to lower the price or close the trade in pieces. Sometimes closing the shorts first (buying back the 2 middle strikes) is the easiest thing to do. Then you can close the 60 strike afterward. The 63 strike you can let expire – or if ADM rallies, you can try closing for 5 cents later in the day. As long as you close the shorts first, you can use your judgment on when to close the longs. Just remember you are buying the short 61.5 calls to close and selling the 60 and/or 63 calls to close.

September 15, 2021 - 2:11 pm

Insiders,

Our MGM September 24th 40 put is now a decent winner. If we close at the current price of around $ 1.oo, we will earn 54% profits on the trade.

Let’s go ahead and close the trade. See trade details below.

Trade Details:

September 15, 2021 - 12:40 pm

Insiders,

I believe I finally found a solution for our VXX trade. I’ve been waiting to find the right put trade in VXX, but the option pricing hasn’t left much margin for error. So, we’re going outside the box a bit and doing a brand new trade for Insiders. For the first time ever, we are using a broken-wing butterfly! It essentially works the same as a regular butterfly, but the max loss is lower in the downside than the upside (in this particular case). Instead of trying to explain it, I’ll show you with a P/L graph. First off though, here’s the trade:

Make sure your order entry looks just like the one above. You’ll likely have to use the “Custom” order form, but you can start it in a butterfly template if you have one. Like a regular fly, you can only lose what you spend on the trade (around $ 65) in this case. Max gain is at 25 at next week’s expiration. For the better view of the P/L, look at the payout chart below. As you can see, max loss is only on the upside. Your loss on the downside is far less. You need spread trading permission to make this trade and unfortunately, it’s not a really a good candidate to replace with a straight put buy (if you can’t make spread trades).

September 10, 2021 - 4:28 pm

Insiders,

Weekly video is now up. Here’s the link:

https://cdn.jwplayer.com/videos/P4wm8erV-Bvib7p4n.mp4

September 7, 2021 - 1:34 pm

Insiders,

I promised that we’d close THS when it got back up near $ 40, and here we are. We’re going to close for around 95 cents, which works out to a 90% gain. See closing trade details below.

Trade Details:

September 6, 2021 - 5:41 pm

Insiders,

Hope you are enjoying your 3-day weekend. Here’s the trade for the OFT Pro issue tomorrow:

We’re buying the United Microelectronics (UMC) October 15th 12.50 call for $ 0.75. We have a buy up to range to $ 1.10.

Trade Details:

September 3, 2021 - 4:20 pm

Insiders,

The weekly video recap is available at the link below for your viewing pleasure. Don’t forget it’s a long weekend with the markets closed on Monday. Enjoy the break!

https://cdn.jwplayer.com/videos/WoR7lVxL-Bvib7p4n.mp4

September 3, 2021 - 12:45 pm

Insiders,

Our ADM call spread expires today (no action necessary), but I’m still bullish on the stock. However, given how slow ADM tends to move, I think switching to a call butterfly makes more sense than placing another call spread trade. If’ you’ve never made a butterfly trade before, just make sure it looks like the screenshot below. You can only lose what you spend on the trade, which should be around 45 or 50 cents on this position (for one spread).

We’re making the 60-61.50-63 call butterfly that expires on September 17th. Remember, you are buying the outer strikes and selling double of the center strike. Max gain occurs if we end up at 61.50 at expiration. In that case, we’d make around $ 1 on the trade. The profit zone is roughly between 60.50 and 62.50.

Trade Details:

September 2, 2021 - 4:40 pm

Insiders,

Just some quick positions updates:

ADM – our call spread will almost certainly expire for zero tomorrow, so no action is necessary. (If for some reason the stock is up big tomorrow, I’ll send out a closing trade.) However, I think ADM is an excellent candidate for a call butterfly. I’ll look at sending that trade out tomorrow most likely (or early next week if the market doesn’t behave).
THS – the addition to the S&P 600 Small Cap index has send the stock close to 40. We’ll look to cash out soon, but feel free to take profits if you are happy with your gains. Looks like we need to do some more order flow trades!
VXX – I am always looking to get into VXX puts (or put spreads/put butterflies) if market conditions are right, so a VXX trade can come on any given day. Typically though, we’ll be looking at doing a VXX trade after a volatility spike.

August 27, 2021 - 4:17 pm

Insiders,

The weekly video is up. Here’s the link:

https://cdn.jwplayer.com/videos/B0J5Z4yD-Bvib7p4n.mp4

August 27, 2021 - 2:13 pm

Insiders,

Let’s take profits in OXY. It’s been a little while since we’ve closed a winner, so we are due. If we close at around $ 2.40, we’re looking at roughly 60% gains or more (depending on your fill price).

See trade details below.

Trade Details:

August 27, 2021 - 12:37 pm

Trade Alert:

VXX is down 5% today, so we won’t be able to do that trade until Monday at the earliest. However, I am sending out a new MGM trade for OFT Pro. The stock has shot up this week and is due for some serious mean reversion, plus the puts are now quite reasonably priced. See trade details below. No action necessary on the 37 puts that expire today – the trade below is a brand new MGM trade.

Trade Details:

August 25, 2021 - 2:13 pm

Insiders,

We’re going to do something a bit different for our new trade today. Normally I like to use vertical spreads or butterflies for Insider trades, but this time we’re doing a straight call. However, the reasoning behind this trade is entirely based on order flow and options action rather than anything fundamental about the company.

Treehouse Foods (THS) is a stock that’s taken a beating lately due to missed earnings. It’s generally not an active options trading stock, with an average of only 186 options traded per day. However, nearly 6,000 contracts have traded today, with over 4,000 of them being calls at the 40 strike in September. The vast majority of the trades appear to be buying the September 40 call with the stock around $ 36 per share.

We’re going to also buy this call and see if this very unusual order flow is happening for a reason (which is usually the case). The calls only cost 50 cents, so you can stick to a 1 lot if you don’t want to commit too much to this trade and only spend $ 50. We don’t necessarily need the stock to go to 40 or above. Even a quick move to 38 would likely result in a 100% gain. Trade details are below.

Trade details:

August 23, 2021 - 6:57 pm

Insiders,

For our OFT Pro trade tomorrow, we are buying the September 24th 24 call in Occidental Petroleum (OXY) for 1.17, with a buying range up to 1.70. See order details below.

Trade details:

August 20, 2021 - 4:47 pm

Insiders,

The weekly recap is up. Have a great weekend!

Here’s the link:

https://cdn.jwplayer.com/videos/jhj4HwRM-Bvib7p4n.mp4

August 16, 2021 - 5:30 pm

Insiders,

I’m on The Final Bar with David Keller this week. Tune in at 6pm ET on Wednesday if you get the chance!

August 13, 2021 - 4:29 pm

Insiders,

It was another slow week in the markets as the last of the summer doldrums set in. Check out the video below for a recap of the week and all of our open positions.

https://cdn.jwplayer.com/videos/gxXvyoRz-Bvib7p4n.mp4

August 12, 2021 - 1:08 pm

Insiders,

Grain prices (wheat and corn in particular) are up big on a very bullish USDA forecast. Supplies expect to be lower than expected. While grain futures are up big today, agricultural companies are not yet seeing a lot of action Archers-Daniels-Midland (ADM) is one of the biggest grain-related companies, and looks poised for a breakout. We’re going to take a bullish position in it using a call vertical spread, the September 3rd 62-64 call spread. We’re looking at a roughly 3-week trade that should only cost around 60-65 cents. The premium cost is the max possible loss on the trade, while the max gain is roughly 1.40 if ADM Is at 64 or higher at expiration. See trade details below. Your broker may list this as a vertical spread or a call spread. You can do it in two separate transactions if you prefer as long as you do the buy part first (62 call). If you prefer or can’t trade spreads in your account, just buying the September 3rd 62 call straight up is a reasonable proxy.

Trade Details:

August 9, 2021 - 4:38 pm

Insiders,

I’m changing things up a bit since it’s been challenging to make money in OFT lately. I’m going with a rebound thesis with an ATM option in AngloGold Ashanti (AU). We are buying the September 17th 16 strike for 85 cents with a buy range up to 1.35. We’re also rolling out VIRT. See trade details for both below.

Trade Details:

August 6, 2021 - 4:46 pm

Insiders,

It was a slow week overall but we have a lot of open positions to discuss. Here’s the link to the video recap for the week:

https://cdn.jwplayer.com/videos/VfArLpyu-Bvib7p4n.mp4

August 6, 2021 - 1:03 pm

Insiders,

Well, to make things interesting, our APA call spread is now in the money. The stock appears to be rebounding from its lows, so the best course of action here is to roll out the trade. However, APA options prices have dropped with earnings out of the way, so we don’t need to do another call spread. In this case, we’ll roll into a simple straight call. The order below may look confusing, but all we are doing is closing the call spread and opening up a new long call. You can do this in multiple transactions, or just create a custom trade entry like the one below.

To close the call spread we need to sell the 18.50 calls to close and buy back the 21.50 calls to close. Then, we are simply buying the 19 call to open for August 20th. The total cost (net debit) should be around 45 cents. That means we need APA to go to roughly $ 19.50 by August 20th expiration to break even on this leg of the trade. You can also use this opportunity to enter the trade from scratch (if you aren’t in it yet) by purchasing the 19 call on its own.

Trade Details:

August 5, 2021 - 6:48 pm

Insiders,

We have the APA call spread expiring tomorrow. Currently it’s out of the money and will expire worthless. However, it’s close enough to lower strike (18.50) that we may need to take action tomorrow. We’ll see what the stock does on Friday and go from there. It looks like oil services/equipment may have found a bottom, so it could be worthwhile to roll this trade out for another week or two. Stay tuned for more info tomorrow.

July 30, 2021 - 4:35 pm

Insiders,

The weekly video recap is now ready to view. Have a great weekend!

Here’s the link:

https://cdn.jwplayer.com/videos/RYpTOvKr-bK67iJnL.mp4

July 30, 2021 - 11:14 am

Insiders,

For closing the VXX put butterfly, it should be a NET CREDIT not a NET DEBIT. I apologize for any confusion.

Volatility can often drop as we get closer to the end of the day, so if you haven’t yet closed the trade, there should be an opportunity to do so for a profit. If will be even better if the market rallies today.

July 29, 2021 - 3:38 pm

Insiders,

We could wait until tomorrow and perhaps make another 30 cents or so on the VXX put butterfly. However, I think we could all use a surefire winner in this market. If we close the VXX trade here, we can get around 88 cents for the butterfly. That’s a 60% winner in 6 days (we paid 55 cents to open). I think that’s a perfectly reasonable profit to make in a week.

Closing a butterfly is just the opposite of opening, but if you need a refresher, just make sure it looks like the screenshot below. Sometimes it can take a little bit longer to get a butterfly closing trade filled, so with the markets quickly approaching closing, it’s okay to be a bit more aggressive on your closing price. If you don’t see this message before market close, there’s nothing wrong with closing this trade in the morning tomorrow. Just make sure you close it by the end of day Friday because this position is likely going to finish in the money.

Closing Details:

July 26, 2021 - 4:42 pm

Insiders,

We only have one action item in the OFT issue tomorrow and that will be buying the MGM Resorts International (MGM) August 27th 37 put for around 1.20 with a buy range up to 1.60. Trade details can be found below.

Trade Details:

July 23, 2021 - 4:29 pm

Insiders,

The weekly video recap is up!

Here’s the link:

https://cdn.jwplayer.com/videos/7jrhIYWO-bK67iJnL.mp4

July 23, 2021 - 2:16 pm

Insiders,

We haven’t done one of these in a while but a put butterfly makes the most sense for our VXX trade. First off, we’re doing a one-week put butterfly that encompasses the next FOMC meeting and what I believe will be the ensuing volatility drop by the end of the week. Options pricing in VXX is very conducive to a butterfly structure. Instead of paying around a dollar for a put spread, we’re doing roughly the same trade for about half the price. If you’ve never done a butterfly before make sure it looks like the trade details below (paying extra attention to the fact that the middle strike is sold to open twice the amount of the outside strikes).

The butterfly we are using is a debit trade, so you can only lose what you spend on the trade (about $ 55 per butterfly), which can occur if we finish outside the butterfly range (above 30.50 or below 27.50). Max gain is at 29 at expiration next Friday, which is around $ 95. More importantly, anything between 29.95 and 28.05 is profitable for us at expiration. As long as you can trade spreads in your brokerage account, you should be able to make butterfly trades (for a debit). If you can’t do spreads, buying the 30.50 or 30 put straight up is a reasonable (albeit more expensive) alternative.

Trade Details:

July 19, 2021 - 5:48 pm

Insiders,

Quite the unexpected move in volatility today. While a big down day in the market does generally lead to a spike in VIX, the magnitude of the VIX move today, particularly in the front months, is something I don’t really recall seeing in recent memory. Take a look at the VIX term structure in the chart below. The grey line is where it closed Friday, still in extreme contango (about 10% difference between the July and August futures). At the high today (purple), the curve was essentially flat (it did actually hit backwardation more than once, albeit briefly). It’s not normal to see the front end of the curve swing that rapidly in one day. However, the expiration in the July future tomorrow night is at least part of the reason since on Tuesday night, the left end of the blue line needs to match the green line (spot VIX) – like it is now. It will be interesting to see where we are tomorrow and Wednesday. I think by Wednesday, we should have a much better idea if this a short-term pullback or the start of a more worrisome selloff.

July 16, 2021 - 4:40 pm

Insiders,

The weekly recap video is up. Here’s the link:

https://content.jwplatform.com/videos/RU0VNAUN-bK67iJnL.mp4

July 15, 2021 - 2:20 pm

Insiders,

APA has collapsed over the last couple days (with crude prices also pulling back), so our decision on what to do with our call spread is now straightforward. First off, the current APA call spread will expire at zero and no action is needed. Second, I felt APA was cheap when it was $ 22 per share, so at around $ 18.50, and oil prices still near 3-year highs, it’s certainly worthwhile to initiate a new call spread. We can buy a 3-week call spread that’s 3-strikes wide for around $ 80. See trade details below.

You can do this trade in two separate transactions as long as you do the buy part first. Your broker will label this a vertical spread or a call spread most likely. The most we can lose is what we pay for it, around $ 80 per spread if APA is below $ 18.50 at expiration. Max gain is at $ 21.50 or above at expiration and is around $ 220.

Trade Details:

July 12, 2021 - 4:36 pm

Insiders,

We have four total action items in the issue tomorrow. We are opening up a new position in Virtu Financial (VIRT), buying the August 20th 28 calls for around 90 cents (with a buying range up to 1.30). We are closing BB, and rolling out TECK and PSTG. See trade details for all four below.

Trade Details:

July 9, 2021 - 4:27 pm

Insiders,

The weekly recap video is up! Here’s the link:

https://content.jwplatform.com/videos/ELmR5iPn-bK67iJnL.mp4

July 8, 2021 - 4:42 pm

Insiders,

I got back from my vacation in Arizona mountain country just as the market started showing signs of weakness. The VIX is up to 19 today, which is as high as it has been in roughly a month. The last VIX spike in June was very short-lived. Will this be a similar situation? We’ll know more over the next couple days. I do think market volatility has become interesting to trade again, so we’ll look at doing something in VXX/VXZ next week.

In the meantime, here’s a pic of my living accommodations on my trip to Pinetop, AZ – right on the shore of a lake. It was rainy for most of the trip, but a welcome break from the consistent 110+ degrees we have in Phoenix this time of year.

June 30, 2021 - 3:15 pm

Insiders,

Let’s talk about TLT. First off, I’m not ready to give up on this trade idea in general. I still think TLT is too high, we just need more time and to adjust our strikes higher for the next trade. With that being said, I’m going to recommend a new trade below. But, this won’t be a rollout of our current TLT spread (that expires on Friday) because that trade trade doesn’t have enough value left to roll. Instead, we are opening a completely separate trade.

Regarding the current (137.5-141) put spread that expires Friday, most likely no action will be necessary. However, I’m going to be out of town Thursday and Friday with no access to the text alert/email system, so you should monitor TLT just in case. It is a new quarter starting on Thursday and there could be some action in bonds. If for some reason TLT drops below or close to 141, make sure you close the trade. It’s not likely going to happen but I won’t be able to alert you if it does. Just be sure to double check on Friday in the event of something unusual occurring.

Okay, on to the new trade. If you haven’t done the previous TLT trades, feel free to jump in now. We are going out to July 30th to give us an entire month for bond prices to drop. See trade details below. We are buying the 143-139 put spread for around 1.12. It’s a net debit trade which means the most you can lose is what you pay for the spread. Max gain is 2.88 if TLT is below 139 by July 30th expiration. Your broker may call this a put spread or a vertical spread. You’ll likely be able to make this trade (or something very similar) tomorrow morning if you don’t see note until after close.

Trade Details:

June 28, 2021 - 4:20 pm

Insiders,

Just a reminder that I’m hosing a webinar with Euan Sinclair tomorrow night at 8pm EST. The topic is trading covered calls for edge. The cost is $ 19 and you’ll get a link to the replay if you can’t make it in person.

Here’s the link if you’re interesting in attending:

https://yn345.infusionsoft.app/app/orderForms/OFT—Trading-Covered-Call-For-Edge-Training-Webinar?a=3313&utm_campaign=oftwbrpa&utm_source=iacom&utm_medium=sponsor&t=oftwebsprcamowbpdoitkr

June 28, 2021 - 3:56 pm

Insiders,

Our new OFT Pro trade coming out in tomorrow’s issue is buying August 20th calls in Baker Hughes (BKR). The current price is 85 cents and I’m recommending a buy up to 1.25. See order details below.

Order Details:

June 25, 2021 - 4:31 pm

Insiders,

The weekly recap video is up!

Here’s the link:

https://content.jwplatform.com/videos/taixgP8s-bK67iJnL.mp4

June 24, 2021 - 3:09 pm

Insiders,

With crude oil above $ 70 a barrel , my goal was to find an oil company that looked cheap relative to the industry and buy a short-term call spread on it. I found that company in APA (APA). The good news is, we can buy a call spread that can make money even if the stock doesn’t break out to new highs.

We are going to buy the July 16th 22-24 call spread for around 73 cents. As can be seen in the order details below, we are buying to open the 22 calls and selling to open the 24 calls. These can be done at the same time or in separate transactions (as long as the buy part comes first). If you can’t trade spreads in your account, you can just do the 22 call part of the trade. Your broker may also have this labeled as a vertical spread instead of a call spread. The most we can lose is what we spend (73 cents) if APA finish below 22 at expiration. Max gain is at 24 or above at expiration with a potential gain of 1.27 or 174% in profits.

Trade Details:

June 23, 2021 - 3:06 pm

Insiders,

Energy commodities are now the top performing futures contracts this year, with oil leading the charge. West Texas Crude is above $ 70/barrel for the first time since 2018. I’m looking at doing an oil-related trade this week for Insiders. Stay tuned.

June 18, 2021 - 4:19 pm

Insiders,

We had a pretty eventful end of the week. We talk about the market selloff and the impact on our positions in the video recap.

Here’s the link:

https://content.jwplatform.com/videos/HluUtNXp-bK67iJnL.mp4

June 17, 2021 - 4:20 pm

Insiders,

I’m doing a covered call webinar with Euan Sinclair that I’m very excited about. As you know from the OFT Pro issues, Euan is an authority on options trading and his stuff is always fantastic. This webinar will be on June 29th (Tuesday) at 8 pm EST. Euan will discuss the benefits of covered calls and how to pick the strike and expiration for covered call trades. He’s got a different way of looking at things than I do, so even if you’re familiar with covered calls, I think this webinar will be worth your time. It’s a premium webinar and will cost $ 19, but don’t worry if you can’t attend the live event as you will certainly have permanent access to the recording.

For those interested, here’s a link to the order page:

https://yn345.infusionsoft.app/app/orderForms/OFT—Trading-Covered-Call-For-Edge-Training-Webinar?a=3313&utm_campaign=oftwbrpa&utm_source=iacom&utm_medium=sponsor&t=oftwebsprcamowbpdoitkr

June 14, 2021 - 5:30 pm

Insiders,

We have 3 action items in the OFT Pro tomorrow. First off, we are buying puts in Blackberry (BB). Specifically, we are buying the July 16th 12 puts for around 90 cents. The buy up to price is 1.25. We are also rolling ZNGA to August for around a 15 cent CREDIT (by rolling up to the 11 strike). Make you are doing this trade for a net credit if you are in ZNGA. Finally, we are opening up a July 15th call in TECK and letting the current TECK calls expire. See trade details for all 3 trades below.

Trade Details:

June 11, 2021 - 4:15 pm

Insiders,

Another week is in the books! Check out my quick review of the week and all of our open positions in the video recap.

Here’s the link:

https://content.jwplatform.com/videos/fJDYTRMO-bK67iJnL.mp4

June 11, 2021 - 2:36 pm

Insiders,

We added a new TLT trade yesterday, so let’s change gears today and focus on copper. The price of copper is up 29% this year, but off its highs. The easiest way to play copper is through Freeport-McMoran (FCX). The copper giant’s stock price has hit a high around 45, but it now sitting closer to 40. We’re going to buy a short-term call spread in expectations of move back towards the 52-week high. We are buying the June 25th 41 call while simultaneously selling the June 25th 43 call. For those who can’t trade spreads, buying the 41 call by itself is a fine alternative. The spread should cost around 68 cents, which is the max loss on the trade if FCX doesn’t climb above 41 by expiration. The max gain is 1.32 if FCX is at 43 or higher in two weeks (at expiration). See trade details below.

Trade Details:

June 10, 2021 - 1:33 pm

Insiders,

Quick correction on the TLT trade – the original order said “Net Credit” when it should be “Net Debit” – here are the proper order details with current prices:

June 10, 2021 - 1:06 pm

Insiders,

Despite CPI coming in higher than expected, bonds did not sell off (which seems like the probable reaction, but alas). Our 135.5-138 put spread will expire worthless tomorrow, but we are going to open a new TLT put spread at higher strikes because I believe bonds are overpriced at the current level. We’ll go three weeks out this time instead of two, and go 1 dollar wider on the spread. You can definitely still make this trade if you were not in the last TLT trade.

Specifically, we are buying the July 2nd 141 puts and selling the July 2nd 137.5 puts for around 95 cents. Your broker will either call it a put spread or a vertical spread. For those of you who have the TLT trade expiring tomorrow, our breakeven point for both trades is around 139 at July 2nd expiration. Anywhere below that is profit. For this leg of the trade, the most you can lose is what you pay, or 95 cents. Max gain is around 2.45, if TLT is at 137.5 or below at expiration. See trade details below.

Trade Details:

June 8, 2021 - 5:31 pm

Insiders,

The VIX remains above 15 but probably has a cap of 20 for the early summer weeks unless some news/event sets off a spark. I think 15-18 is probably the range for now but the summer period can be slow and it may cause volatility to drop further than expected. As you can see in the chart, the VIX futures (blue line) is in steep contango (slanting upward from left to right), which is the “normal” state for VIX futures. It also means VXX is likely to continue selling off for the time being. We may look at doing a VXX put spread by the end of the week.

June 4, 2021 - 3:48 pm

Insiders,

The weekly recap video is up!

Here’s the link:

https://content.jwplatform.com/videos/00bZ6khO-bK67iJnL.mp4

June 1, 2021 - 1:40 pm

Insiders,

We are closing two triple-digit winners today, CCJ and CLDR. See trade details below.

Trade Details:

May 31, 2021 - 5:29 pm

Insiders,

The market is closed today, but we still have the OFT Pro issue coming out tomorrow. There’s only one action item in the issue and that’s the new trade. We’re buying July 20 calls in Pure Storage (PSTG) for around 85 cents, buying up to 1.35 if necessary. Trade details are below.

Trade Details:

May 28, 2021 - 3:22 pm

Insiders,

The weekly recap video is available at the link below. Have a great long weekend!

https://content.jwplatform.com/videos/Kfs4T7T2-bK67iJnL.mp4

May 28, 2021 - 1:59 pm

Insiders,

I mentioned in the live webinar last night that I was considering selling our CCJ calls today. I think we’ll hold off a bit longer. The next OFT Pro issue comes out Tuesday, and we’ll reassess the trade at that time. Don’t forget that Monday is a holiday!

May 27, 2021 - 2:04 pm

Insiders,

While TLT has pulled back some today, it’s still been in a very predictable range the last several months. We’re going to take advantage of that with another TLT put spread. We closed the last one for over 100% gains. This one is a bit shorter term (expiration June 11th) and a slightly smaller spread (2.5 dollars wide). Besides that, it’s very similar to the last one we did. The details are found below. We are buying the 138 put and selling (to open) the 135.5 put. The most we can lose on the trade is what we are spending in premium (around $ 80). Max gain is $ 170 if TLT is at 135.5 or below at expiration. If you don’t have approval to do put spreads with your broker, you can also just buy the 138 put by itself.

Trade Details:

May 24, 2021 - 1:56 pm

Insiders,

We hit the level we were waiting for in UBER, so let’s close our call spread for a profit. To close a call spread, we are selling the long call to close and buying the short call to close, as you can see in the order details below. We paid about $ 0.95 for this spread, so closing it for around $ 2.00 results in $ 1.05 in profit or 111% gains.

Trade Details:

May 21, 2021 - 4:28 pm

Insiders,

The weekly video recap is up!

https://content.jwplatform.com/videos/o68n3L6z-bK67iJnL.mp4

May 17, 2021 - 4:27 pm

Insiders,

There’s a new OFT Pro issue tomorrow with yet another great column from Euan Sinclair. Be sure to check it out. The new trade is in Teck Resources (TECK) – the buy up to price is $ 1.60. We are also rolling out ZNGA. You can find details of both orders below. You can use this opportunity to get into ZNGA if you aren’t yet in the trade (by just doing the June part of the trade below).

Trade Details:

May 14, 2021 - 4:16 pm

Insiders,

It ended up being an eventful week in stocks. I review the week and talk about our open positions in the weekly recap video linked below.

https://content.jwplatform.com/videos/npt80cwY-bK67iJnL.mp4

May 12, 2021 - 6:26 pm

Insiders,

Big volatility day with spot VIX (green line) shooting up from around 22 to over 27. It’s hard to tell from the pic below but the futures term structure (blue line) is mostly flat. I would say this is worrisome, except I don’t believe this situation will hold. I’m guessing tomorrow will end up being an up day, unless some unexpected negative news hits the wire. Still, not a bad idea to consider a cheap hedge (OTM put spreads in SPY for example) just in case the selloff intensifies. We’ll see how the term structure looks at the end of the week.

May 12, 2021 - 1:55 pm

Insiders,

We got the move in TLT we were looking for, so let’s close our put spread for a profit. Remember, you are selling to close the 138 put and buying to close the 135 put. You can see the order details below. You can also close the trade in two separate transactions as long as you close the short put first. We are closing for around $ 1.90 (net credit). We paid about 88 cents for it. That means we are making $ 1.02 or 116% in profits.

Trade Details:

May 11, 2021 - 1:13 pm

Insiders,

Let’s add another trade to our Insider’s portfolio. I think Uber (UBER) was oversold after its recent earnings miss. The news wasn’t nearly as bad as the resulting selloff. What’s more, the stock price is up today when much of the market is in the red. We’re going to buy a 3-week call spread with the expectation that it will rebound from the lows. See trade details below. We are buying the June 4th 47 call and selling the June 4th 50 call for a total debit around 95 cents. You can do these as separate transactions as long as buy the 47 call before you sell the 50 call. Your broker may label this a call spread or a vertical spread. The most you can lose on the trade is the amount you spend on it ($ 95 in this case), and max gain is $ 205 if Uber climbs above $ 50 at expiration.

Trade Details:

May 10, 2021 - 5:12 pm

Insiders,

I’m looking to do a new trade tomorrow, so keep an eye out for a text during market hours. Also, I’m going to be on the Final Bar on StockCharts TV tomorrow at 6pm ET. Tune in if you get the chance!

May 7, 2021 - 4:36 pm

Insiders,

We had a lot of action in our positions this week, both in OFT Pro and Insiders. SLV was our big winner for Insiders. On the other hand, let’s pretend we’ve never heard of RKT. I talk about all the open positions in the weekly recap video linked below.

https://content.jwplatform.com/videos/DNTtDYre-bK67iJnL.mp4

May 3, 2021 - 5:51 pm

Insiders,

We have two trades in the OFT issue tomorrow. The first is a June 18th 19 call in Cameco (CCJ). The stock was way up today, so if it keeps going up, you can buy up to $ 2.00 per contract. If it’s down tomorrow (like what happened with CLNE) you can either choose a lower strike or pay less for the 19 calls. The second is a roll out trade in CLDR (we’re extending the trade a month). Both trades can be found below. If you aren’t yet in CLDR, you can use this opportunity to get in (only make the June part of the trade in that case). Also, be sure to check out the new guest column from Euan Sinclair in the issue tomorrow.

Trade Details:

May 3, 2021 - 1:10 pm

Insiders,

SLV has made the move we were waiting for, and now we can close our call spread. If you’ve never closed a call spread, make sure it looks like the order screen below. We are selling the 23.50 strike to close and buying the 25 strike to close for a credit of around 1.17. You can also close it in two separate transactions as long as you close the 25 strike first. We paid 45 cents for this spread initially, so if we close it for 1.17, we are making 72 cents in profit, or 160% gains.

Closing Trade Details:

April 30, 2021 - 4:26 pm

Insiders,

We didn’t quite get the opportunity to close the SLV call spread this week, so we’ll try again next week (it expires next Friday).

Here’s the link for the new weekly recap video:

https://content.jwplatform.com/videos/YVkzYY4q-bK67iJnL.mp4

April 27, 2021 - 6:48 pm

Insiders,

We’re getting close to exiting the SLV call spread, although you certainly don’t have to wait for me to take profits.

It’s a huge earnings week, but the markets have been pretty quiet so far. VIX remains just below 18 as you can see from chart. Last week, intraday VIX moves were definitely getting larger, but the last couple days have been uneventful. Let’s see how the market reacts to earnings tomorrow.

April 23, 2021 - 4:16 pm

Insiders,

The weekly recap video is up. Here’s the link:

https://content.jwplatform.com/videos/gYoEIn5l-bK67iJnL.mp4

April 21, 2021 - 2:22 pm

Insiders,

Let’s add another trade to our mix. This time, we’ll do a May 14th put spread on TLT. I think long bonds will be range bound for a while. With TLT close to $ 140, I think it’s reasonable to assume it will make a run at $ 135 sometime in the next 3 weeks. Remember, with a put spread you can only lose what you spend (around 88 cents in this case). Max gain is at $ 135 or lower in the stock, and will result in roughly $ 2.12 in profits. See trade details below. Your broker may call it a vertical spread, which is fine, as long as you make it look like the order below.

Trade Details:

April 19, 2021 - 7:19 pm

Insiders,

The RKT roll order screenshot had an incorrect strike. I’ve attached a screenshot with the proper strikes. (We are rolling/closing the 26 strike, not the 26.5, so the total debit should be closer to 85 cents instead of 90.)

April 19, 2021 - 4:14 pm

Insiders,

We have two action items in tomorrow’s issue. The first is the new trade, a May 21st call in Clean Energy Fuels (CLNE). The 13 strike is trading for $ 0.95 at close today, but I placed the buy-up-to price all the way to $ 1.75 because I have feeling tomorrow could be volatile. The second trade is a roll-out of RKT (or it could be an entry point if you aren’t in the trade). See order details below for both trades.

Order Details:

April 16, 2021 - 4:20 pm

Insiders,

Our Weekly Video Recap is up. Here’s the link:

https://content.jwplatform.com/videos/T8zBKLR3-bK67iJnL.mp4

April 16, 2021 - 1:29 pm

Insiders,

We are rolling out our ZNGA call to May. I think the stock has way more upside. Just make sure you either roll the trade (close April, open in May) as seen below, or close the call outright so that you don’t get the call exercised into shares.

Trade Details:

April 15, 2021 - 5:41 pm

Insiders,

Not as much going on in the markets this past week. Bonds did jump today, with TLT back to $ 140. It’s something we may want to trade (by buying a put spread or something similar), but I’d like to see what it does over the next couple days. Our SLV put spread is in the money, with SLV over $ 24. We paid 45 cents and its worth about 60 now, but I think we can do better if we give it more time. Volatility continues to collapse, both with the overall VIX level (green line) and the futures (blue line). Contango has been striking in its steepness (the difference between the first and second month), but we do have expiration coming next week which can distort the picture.

April 9, 2021 - 4:04 pm

Insiders,

I talk about the upcoming VXX 1 for 4 reverse split in today’s weekly video recap (along with a discussion of our open positions).

Here’s the link:

https://content.jwplatform.com/videos/cUN88Y2d-bK67iJnL.mp4

April 8, 2021 - 6:27 pm

Insiders,

The VIX continues to drop as the financial markets seem to finally be moving past the pandemic. Spot VIX (the green line below) is below 17 and the futures term structure (blue line) is in steep contango (when the front month is much lower than the second month). This situation provides downward pressure on VXX. However, with VXX only around 10, there isn’t much room for it to fall. It should be due for a reverse split soon. Once that happens, I’ll be more inclined to buy puts or put spreads (or put butterflies) on it.

April 6, 2021 - 2:51 pm

Insiders,

Let’s trade! SLV has been range-bound for roughly the last 8 months. The silver ETF is near the bottom of this recent range, so let’s take advantage with a one-month call spread. SLV options aren’t that expensive, but a call spread nearly cuts our premium outlay in half. We are going to do the 23.5 – 25 call spread, which hits max gain if we close over 25 at expiration. The max loss is what we pay for it, which is currently 45 cents. See trade details below. Please notice the expiration is for May 7th and we are buying the 23.50 call to open and selling the 25 call to open for a net debit of around 45 cents.

Trade Details:

April 5, 2021 - 5:34 pm

Insiders,

We’re going a little more conservative with this week’s OFT trade, buying May 14th calls in Cloudera (CLDR). See the trade details below. There is no action on RKT or ZNGA in this issue, although next week we’re likely to have a ZNGA roll-out or closing trade. Also, be sure to check out Euan Sinclair’s guest column in the issue tomorrow!

Trade Details:

April 2, 2021 - 4:01 pm

Insiders,

In the weekly video recap, I talk about why we didn’t end up doing a trade this week, plus what’s in store for next week.

Here’s the link:

https://content.jwplatform.com/videos/LSfuJ4jo-bK67iJnL.mp4

March 30, 2021 - 12:56 pm

Insiders,

We’re due for a new Insiders trade, but none of the stuff I’ve been watching looks attractive right now for trading. We’ll definitely have a new trade to make this week, but I don’t know when or what it will be. We certainly don’t want to force a new trade just to trade. Nevertheless, I have no doubts that a good opportunity will present itself in the next couple days, so stay tuned.

March 26, 2021 - 4:04 pm

Insiders,

I give several ideas for potential trades next week in today’s weekly video recap. Check it out at the link below.

https://content.jwplatform.com/videos/5w80glNa-bK67iJnL.mp4

March 26, 2021 - 10:32 am

Insiders,

VXX is back down today as expected. Let’s close our long puts here and take profits. We opened the trade at around 48 cents and should be able to close right around 70 cents. That’s 22 cents in profit (46% gains). See closing trade details below.

Trade Details:

March 24, 2021 - 3:31 pm

Insiders,

Regarding VXX, we’ll look at closing tomorrow or Friday. The contango is still quite steep as you can see in the chart below. Contango occurs when the front month future (April) is lower than the second month future (May). The steeper the relationship, the more pressure there will be on VXX. So, even if the market drops and VIX goes up or stays still, we could still see VXX drop.

March 22, 2021 - 4:09 pm

Insiders,

For tomorrow’s issue, we’ll be purchasing calls in Rocket Companies (RKT). See trade details below.

Trade Details:

March 19, 2021 - 4:46 pm

Insiders,

The new weekly video recap is up. Here’s the link:

https://content.jwplatform.com/videos/c4wmE5wM-bK67iJnL.mp4

March 17, 2021 - 3:07 pm

Insiders,

Let’s make this one an easy trade. With the Fed news out of the way, there should be downward pressure on short-term volatility. This will be especially true in VXX due to the sharp contango in the VIX term structure (which helps push down the price of VXX often when the futures are rolled). We are going to buy an ATM put in VXX, very short-term (March 26th expiration). We may add a VXZ call spread at some point in the future, but for now, let’s stick to the simple put in VXX. Trade details are below.

Trade Details:

March 17, 2021 - 2:45 pm

If you didn’t get a chance to join me, Euan, Dmitry, and Will on Monday night then be sure to check out the recording of Trading Options Skew for Edge. Click here to watch right now.

March 16, 2021 - 1:56 pm

Insiders,

CCJ has been flying, so let’s close it here for nice profits. For my published entry level of 1.00, closing it here will result in 102% profits. See trade details below.

Trade Details:

March 12, 2021 - 3:36 pm

Insiders,

I talk about TLT. MRVL, and CCJ (along with our other positions) and what we can expect for next week in the weekly recap video. Also, don’t forget about the webinar with Euan Sinclair on Monday night!

Video Link:

https://content.jwplatform.com/videos/pP017Myw-bK67iJnL.mp4

March 12, 2021 - 1:17 pm

Insiders,

Last week we had the USO call butterfly in our profitable range for pretty much the entire duration of the trade up until expiration Friday when it jumped out of the range. Today, we’re seeing the exact same thing happen with our TLT put butterfly. It was in the profit range all week (but not at a point where we could sell), and then today TLT dropped right through the bottom of the range. I’m going to move away from using most butterflies while the market remain this volatile. They just haven’t been paying off, and have been challenging to close even when they do pay out.

For the TLT trade today, you can just let it expire. If you want to avoid getting a bunch of annoying messages from your broker about assignment/exercise, you can try to close for even (zero). However, upon exercise/assignment, the long and short shares will cancel out. It’s not likely that TLT will rebound, but just in case, you can wait until near the end of the trading day to close. Or, once again, there will be no additional risk to you to let it expire. However, your account may look weird/scary over the weekend while the trades settle.

March 10, 2021 - 4:14 pm

Insiders,

I’m really excited to be doing a special, members-only webinar next Monday with Euan Sinclair. His books on options trading are some of the most widely-read and influential in the industry. The webinar will be at 8pm ET on Monday and we’ll discuss trading options skew for edge. It will be me, the guys from Marketchameleon.com, and Euan. I hope you can attend or catch the replay!

Here’s the link:

https://us02web.zoom.us/webinar/register/WN_i-nD8SQMQ0mM1k1vGWBKvw

March 9, 2021 - 1:03 pm

Insiders,

MRVL is up $ 3 today, and the OFT Pro issue hasn’t gone out by email to the masses yet, so I’m updating the strike to 47 and the price to $ 1.40. See new trade details below:

Trade Details:

March 8, 2021 - 4:52 pm

Insiders,

Lots of action items in tomorrow’s OFT Pro issue. We are buying calls in MRVL as our new trade. We are closing XRX for a profit and M for a loss. Finally, we are rolling out ZNGA. Trade details are below for all 4 actions.

Trade Details:

March 5, 2021 - 3:58 pm

Insiders,

I talk about our positions and the bond market, among other things, in this week’s weekly video recap.

Here’s the link:

https://content.jwplatform.com/videos/CKWY4Xw0-bK67iJnL.mp4

March 4, 2021 - 2:51 pm

Insiders,

It’s been more challenging lately to get filled on closing butterfly trades. So, I’m going to send the closing alert for our USO call butterfly now, knowing that it may take until tomorrow to get the price you want. I’m recommending a closing price of $ 1.00, but anywhere around that price is fine for closing (we only spent 55 cents on the trade). If you’ve never closed a butterfly before, there order screen below shows how it should be sent to your broker. I suggest putting your net credit around mid-market and lower it every five minutes or so until it gets filled.

Trade Details:

March 3, 2021 - 3:54 pm

Insiders,

We’re seeing volatility catching a bid (trader slang for moving higher). Today, the SPY itself, the tech sector, and utilities all increased to moderate volatility from the subdued level There’s aren’t any obvious concerns of an extreme nature on the horizon, but several smaller things could add up. We’ll keep an eye on the situation. Table courtesy of marketchameleon.com.

March 2, 2021 - 2:22 pm

Insiders,

Okay, it’s time for another trade! You know how much I love butterflies, so we’re going to do another call butterfly, this time in TLT. If you are new to Insiders or are hesitant to make these trades, butterflies are very low risk. The only semi-regular problem I have is getting in and out of the trades quickly. Sometimes you have let your order sit for a while or accept a worse price if you are in a hurry. Besides that, you can only lose what you pay for the trade, you have a price range where your trade is a winner, and you can achieve outsized returns.

For TLT, we’ll do the March 12th 138-141-144 call butterfly with the stock at $ 140.81. That makes this a roughly market neutral trade. With the cost of the butterfly at around 95 cents, our profitable range is between 138.95 and 142.05 on March 12th expiration. Max gain is at 141 at expiration, which would be 2.05 in profits. We’re not looking to hit max gain, rather we are seeking 50% – 100% gains. See trade details below.

Trade Details:

February 26, 2021 - 3:25 pm

Insiders,

It was definitely an interesting week, with a lot more action than what we’ve seen so far in February. I’m looking to do another Insiders trade early next week. We should also get the opportunity next week to close the USO butterfly for a profit. There are two links below, one for the just uploaded weekly video recap, and one for the Insiders Live Session from last night.

Weekly Recap:

https://content.jwplatform.com/videos/HHz8vala-bK67iJnL.mp4

Live Session Replay:

https://www.investorsalley.com/options-insiders-monthly-live-session/

February 25, 2021 - 5:41 pm

Insiders,

Today was pretty crazy, especially in the bond markets. We have a lot to about tonight at our live session! Hope to see many of you later on.

Here’s the link:

https://us02web.zoom.us/j/851872273

February 23, 2021 - 5:26 pm

Insiders,

A few odds and ends:

1) Apologies for not texting out the OFT Pro trade yesterday. I ended up having a crazy afternoon and forgot to get that out to you.

2) Don’t forget, our Insider’s Live Session is on Thursday. Here’s the link, which will also come to you via email:

https://us02web.zoom.us/j/851872273

3) Finally, here’s an interesting chart of the shape and level of the VIX term structure over roughly the last year. We’ll discuss this chart during Thursday’s live session but the crux of it is VIX is still high but most of the buying seems to be in the longer-dated futures.

February 19, 2021 - 3:08 pm

Insiders,

Our weekly recap video is now available at the link below:

https://content.jwplatform.com/videos/F8myIXYW-bK67iJnL.mp4

February 17, 2021 - 2:31 pm

Insiders,

Finally, for OFT Pro, we are closing FRO if you still hold it, and rolling out XRX. See trade details for both below.

XRX Rolling Trade:

FRO Closing Trade:

February 17, 2021 - 2:11 pm

Insiders,

Okay, let’s open a new trade! I’m slightly bullish on oil for the next couple weeks due the weather issues, but I don’t think it’s going to skyrocket. I generally use USO to trade oil, which holds oil futures. With the futures term structure for oil relatively flat, USO should hold its ground or move a bit higher over the next couple weeks. As such, we are going to enter into a call butterfly in USO that expires on March 5th. It will cost around 55 cents, which is all we could lose on the trade if it doesn’t end up in the butterfly range of 40-44 by expiration. Max gain is with USO at 42 on expiration day, where we could make around 1.45. The profitable range at expiration is roughly 40.55 to 43.45. Remember, we aren’t likely to close the trade until close to expiration because in this case, time decay works in our favor (we are short 2 of the middle strike).

Trade Details:

February 17, 2021 - 1:50 pm

Insiders,

We have lots of action coming today, so let’s start by closing the CORN call butterfly (which expires this week). We paid 30 cents for it and will close it for around 70 cents (133% gains). It’s worked out quite well, especially for a low risk trade. If you’ve never closed a butterfly, just make sure your order screen looks like the one below.

Trade Details:

February 16, 2021 - 6:05 pm

Insiders,

We’re almost ready to do some trading! Keep an eye on your phone tomorrow for a text alert late morning or early afternoon. We also may be closing the CORN trade as it’s roughly a 100% winner. I also may be sending several action items for OFT Pro trades. Stay tuned!

February 15, 2021 - 3:47 pm

Insiders,

Hope everyone is enjoying their long weekend. Here’s a snapshot of volatility (IV – implied volatility) across the S&P 500 sectors (courtesy of marketchameleon.com). As you can see, we’re running subdued across the board. Implied volatility is very near 52-week lows in just about every sector. Keep in mind, the last 52 weeks includes a stock market crash, so what may be subdued this year is very different than years past. Regardless, it’s clear that volatility has declined substantially. That’s generally a sign that bullish conditions will continue. While that can obviously change in a hurry, for now it looks like a pretty safe investing environment.

February 12, 2021 - 4:02 pm

Insiders,

The weekly recap is now available at the link below. Have a great 3-day weekend.

https://content.jwplatform.com/videos/nBZeZakt-bK67iJnL.mp4

February 12, 2021 - 3:02 pm

Insiders,

Forgot to mention that the markets will be closed on Monday for President’s Day, so any actions we have won’t come until at least Tuesday.

February 12, 2021 - 2:58 pm

Insiders,

A couple quick trade updates:

1) I want to give CORN a little more time to approach 17 (the center of our butterfly). We’ll look at closing early next week.

2) We’re overdue for a new trade, but I still haven’t found anything that I love. I’m optimistic that Monday will be the day where I send out a new alert. I’m looking at TLT and VXX among others. Ideally, we’ll find more than one trade worth doing next week, but we’ll take things one a time for now.

February 9, 2021 - 4:43 pm

Insiders,

I’m still looking at doing a VXX trade, but I haven’t found something that jumps out at me yet. Volatility remains elevated overall, with the term structure in steep contango (sharply sloping upward). However, the short-term butterflies are priced to perfection, that is, I don’t see a lot of opportunity at the moment. We’ll wait a bit longer and see if the prices move enough to create a trade opportunity. Meanwhile, I’ll extend my search for new trades. If you’re in the CORN trade, we have nearly doubled our premiums in that position and will be looking at closing soon.

February 8, 2021 - 5:27 pm

Insiders,

We’re taking a page form Wall Street Bets this week and buying OTM calls in Macy’s (M). See below for the trade that comes out in tomorrow’s issue.

Trade Details:

February 5, 2021 - 3:55 pm

Insiders,

VXX dropped all the way back down to the 16 handle this week, so there wasn’t a good opportunity to enter into a new put butterfly. However, if VXX is around 16-17 early next week, we may get our chance to enter the trade. In the meantime, the weekly recap video is ready to view.

Here’s the link:

https://content.jwplatform.com/videos/okAF5PPQ-bK67iJnL.mp4

February 2, 2021 - 3:32 pm

Insiders,

Here are a few quick thoughts (in no particular order) on the WSB/Robinhood situation with stocks like GME:

Robinhood has done a really poor job of being prepared for the situation that unfolded with GME and other squeezed stocks, and their communication to clients has been atrocious. That being said, they aren’t restricting trading due to pressure from hedge funds or Citadel or anything like that. They are conforming to rules that have to do with settlement and clearing of stocks that were set forth mostly in Dodd-Frank after the 2009 crisis. It isn’t some scheme of the rich against the average main street trader.
Short selling funds can be annoying but they aren’t evil. They serve a purpose in the market just like any other market participant. No legit company has ever gone out of business because of short sellers. Nevertheless, I don’t feel sorry for a short selling fund using 140% leverage to short a stock without being properly hedged. That’s on them, not the WSB traders.
WSB traders aren’t doing anything differently than a lot of stock buying hedge funds, and it’s definitely not illegal. However, they are taking a lot of risk and eventually these tactics will likely result in big losses for those who aren’t careful.
The short squeeze phenomenon in GME and others may be done for the time being, but it doesn’t mean it can’t happen again.

January 29, 2021 - 3:53 pm

Insiders,

Another crazy week in the stock market! Here’s the link to my recap:

https://content.jwplatform.com/videos/aExfpqe1-bK67iJnL.mp4

January 27, 2021 - 2:08 pm

Insiders,

VXZ has climbed above 34 and our 32-35 call spread is a clear winner. Theoretically, we could sell it for higher if we wait until closer to expiration. However, a lot can happen between now and February expiration, so I think taking profits now is the safest path. Keep in mind, this was part of a two part trade, and we already closed the VXX put butterfly for nice profits. Let’s go ahead and close the VXZ call spread today. Trade details are below. If you close for 1.40, we will make 60 cents on the trade. That works out 75% profits.

Trade Details:

January 22, 2021 - 3:54 pm

Insiders,

The weekly recap video is now up.

Here’s the link:

https://content.jwplatform.com/videos/TCcfy6b7-bK67iJnL.mp4

January 20, 2021 - 3:02 pm

Insiders,

Are you ready for a new trade? I’ve been watching the Teucrium Corn Fund (CORN) since grains have taken off this year. Not only does it appear that another commodity boom may be underway, but the WASDE report was very bullish for corn crops. I think the price of corn, and thus the price of CORN, will remain elevated for the time being. It’s a good opportunity for a neutral/slight bullish butterfly.

If you are new to butterflies, this would be a good trade to try out because it should only cost $ 30 – $ 35 for a trade (which is the max loss). Max gain is $ 100 minus whatever you pay for the trade ($ 65 – in this case). The profitable range is roughly $ 16.30 to $ 17.70 with max gain achieved at $ 17 at expiration. If you want to be more aggressive, just increase your quantity. For example, a 5-lot will cost around $ 150 with a max payoff of $ 350. Trade details are below. Be sure to make your trade entry look like the one below, especially if you’re new to trading butterflies.

Trade Details:

January 19, 2021 - 4:14 pm

Insiders,

We’re looking at doing a new trade tomorrow or Thursday. In the meantime, volatility has remained elevated. The VIX is is around 23 (green line) which is 30-day implied volatility. That is, it’s looking forward. 30-day historical volatility (red line) is all the way down at 10. Still a large gap there despite the Senate runoff being well in the past. Most likely implied volatility is elevated due to Covid and the slow pace of the vaccination rollout rather than anything political. I expect the gap to shrink over time, but it may take months. We’ll continue to monitor the volatility situation for possible trade opportunities. Right now, our long VXZ call spread is right about at the money.

January 15, 2021 - 4:08 pm

Insiders,

Weekly video recap is up. Here’s the link:

https://content.jwplatform.com/videos/XQVMiMU4-bK67iJnL.mp4

January 14, 2021 - 2:16 pm

Insiders,

Well, I was obviously optimistic on BlackBerry (BB), but I had no idea the move higher would happen so fast. It’s hard to beat over 100% gains in 2 days, so let’s go ahead and close the trade and take profits.

We paid around $CONTENT.95 for our BB calls. They are now trading at .05. If we close now, we’ll make 0, or 116% gains. Closing trade details are below.

Trade Details:

January 13, 2021 - 1:48 pm

Insiders,

Part 1 of our volatility trade is ready to be closed for gains. VXX has done almost exactly what we hoped for and is closing in on 16 as expiration approaches. We bought the 14-16-18 put fly for 62 cents and now we can close it for around 1.35. For 118% gains, I don’t see any reason to hold any longer. Let’s close our VXX put butterfly now and enjoy our first win of 2021. If you’ve never closed a butterfly before, the trade details are shown below.

Trade Details:

January 11, 2021 - 3:24 pm

Insiders,

We’re taking a shot on Blackberry (BB) calls expiring in March for our OFT Pro trade in tomorrow’s issue. Here are the details if you want to try to get into the trade early.

Trade Details:

January 8, 2021 - 4:24 pm

Insiders,

It’s been an eventful week. I talk about the past week and our open positions, as well as what’s to come, in the video linked below.

https://content.jwplatform.com/videos/beRpGwtT-bK67iJnL.mp4

January 6, 2021 - 6:04 pm

Insiders,

Given the events of today, it’s no surprise to see the VIX term structure moving all over the place. Take a look at the highs and lows from today. Pretty amazing movement in the curve. Let’s hope tomorrow is more calm for obvious reasons.

January 1, 2021 - 2:03 pm

Insiders,

Happy New Year!

I recorded a quick recap of our open positions and what we are expecting to happen with volatility over the next few weeks or so. Here’s the link:

https://content.jwplatform.com/videos/FXvN7sEF-bK67iJnL.mp4

December 28, 2020 - 3:06 pm

Insiders,

It’s a bit slower week due to the holidays, so I’m able to get our OFT Pro trade out early to you – during market hours today. It’s a February call on Xerox (XRX). See trade details below.

Trade Details:

December 24, 2020 - 11:49 am

Insiders,

BBBY never got the rally I was hoping for this week, but we need to close our call spread regardless because it is still in the money. (Hopefully some of you didn’t wait for me and closed this spread last week for a profit.) You can wait a little longer today to see BBBY rallies into the close, but be sure you close the spread today no matter what so you don’t exercise the long call into shares. Remember, the market closes early today, so there’s only about an hour or so left until close. Closing details are below.

Also, there won’t be a market recap tomorrow as it’s a holiday, but there will be one next week.

Trade Details:

December 22, 2020 - 2:23 pm

Insiders,

Looks like we need to wait another day at least to close the BBBY call spread. So, let’s go ahead and place two new volatility positions for the next month. Both VXX and VXZ options were pricey, so I had to get a bit creative to make these trades affordable. To make VXX puts worthwhile, given we are also buying VXZ calls, we need to do a put butterfly. For VXZ, we are using a straight bull call spread.

The general goal is to make money on the VXX put fly and use the VXZ call spread as a hedge (so that it’s likely going to be a loser). We want to make more money on VXX than we lose on VXZ. However, since VXZ expires in February and VXX in January, we could theoretically make money on both trades.

The VXX put butterfly will cost around 62 cents with a profit range between roughly 17.38 and 14.62 at expiration. Max profit is 1.38 if VXX is at 16 on January 15th (expiration). The VXZ call spread will cost around 80 cents with a breakeven point of 32.80 and max profit at 35 or above of 2.20. Yes, there is more profit potential from the VXZ trade, but that scenario is far less likely to occur than is VXX heading south after the January Senate election. However, I wanted us to be in a position to make money if volatility does explode higher.

The most we can lose combined on the trades is about 1.42, which I think is very reasonable considering we have exposure to short-term volatility going down and mid-term volatility going higher. Of course, you don’t have to make both trades – if you have a preference, you can easily do one of the two trades instead of both. Trade details for both trades are below.

Trade Details:

December 22, 2020 - 1:37 pm

Insiders,

Let’s close both VIRT and AVT for big winners. Volume is going to dry up over the holidays and the market could move unexpectedly, so I think it’s the safest course to take gains now. Think of it as an early holiday gift. Closing details for both trades are below.

Trade Details:

December 21, 2020 - 4:21 pm

Insiders,

Just a quick reminder that our last live session for the year is tonight at 8pm EST.

Here’s the link:

https://us02web.zoom.us/j/851872273

December 18, 2020 - 3:32 pm

Insiders,

Weekly recap video is available at the link below.

Link:

https://content.jwplatform.com/videos/OkIYiBIb-bK67iJnL.mp4

December 18, 2020 - 12:31 pm

Insiders,

Silver has jumped the last couple days, and surprisingly, our SILJ calls are now in the money. You should be able to close for around $ 0.80. It’s not a profitable trade, but we are preserving a decent chunk of the invested capital. Expiration is today, so be sure to close the trade, otherwise the calls will automatically be exercised into stock over the weekend. See trade details below:

Trade Details:

December 15, 2020 - 5:01 pm

Insiders,

Just a quick look at market volatility: the VIX was down a couple points today but overall volatility remains bid. There’s still a sizable gap between implied (forward-looking) volatility (the green line) and realized (backwards-looking) volatility (the red line). I expect that gap to remain relatively large until after the election in January, but things could change depending on news the next couple weeks (mostly regarding the pandemic). The Dec VIX future expires this week, which means the futures curve (blue line) will go back to being mostly flat. That’s generally a sign of uncertainty about future volatility conditions.

December 14, 2020 - 4:51 pm

Insiders,

The new OFT Pro trade for tomorrow is a call in Avnet (AVT). There are no additional closing or rolling trades in this issue. See trade details below.

Trade Details:

December 11, 2020 - 3:48 pm

Insiders,

The weekly video recap is now available. Here’s the link:

https://content.jwplatform.com/videos/wQH5pU7o-bK67iJnL.mp4

December 8, 2020 - 2:40 pm

Insiders,

Time for a new trade! For a change of pace, we’re going to do a call spread (bullish) instead of a butterfly trade. If you’re in WIA, you know I’m a fan of Bed Bath & Beyond (BBBY). Well, the stock has dropped all the way to around $ 18.50, which I think is too cheap. We’re going to buy a call spread that expires December 24th that costs around 80 cents. The price we pay is the most we can lose on the trade if the stock is below 18.50 at expiration. Max gain is above 21, where we can earn around 1.70. See trade details below for how to set up the trade in your brokerage account.

Trade Details:

December 7, 2020 - 5:00 pm

Insiders,

Pretty quiet day overall for the major indexes. It won’t shock me if this is what we’ll see most days for the next few weeks. Things could heat up before the Georgia Senate runoff, but beyond that, who knows if December will hold any action. The VIX is still elevated though, and ticked above 21 today, as you can see below. I think the short-term economic shutdown/slowdown due to Covid and the senate runoff will likely keep the VIX marginally elevated for the time being.

I’ll most likely have a new trade for us tomorrow, possibly something besides a butterfly for a change! Stay tuned.

December 4, 2020 - 3:51 pm

Insiders,

The weekly video recap is available at the link below. Have a great weekend!

Link:

https://content.jwplatform.com/videos/6dutTbpm-bK67iJnL.mp4

December 4, 2020 - 3:00 pm

Insiders,

We have two butterflies that expire today for TLT and MS. TLT has dropped out of range of the butterfly strikes, so we can ignore that one and let it expire out-of-the-money. On the other hand, the MS butterfly is in the money, so we’re definitely going to close it. The price has been fluctuating quite a bit, with the closing price for the position moving from around 10 cents to 25 cents even as I type this. I’m going to include the current screenshot of the closing trade, but just be aware the price is moving a lot. You can wait as long as you want to execute the trade as long as you close it in the next hour (before market close). Make sure you close the trade so you don’t get assigned on any MS stock. We are close to breakeven at this point (35 cents was our initial price). If you’ve never closed a butterfly before, just make it look exactly like the screenshot below. I’d try get filled at the midpoint first if possible before moving down towards the bid price.

Trade Details:

November 30, 2020 - 5:44 pm

Insiders,

The new issue of OFT Pro comes out tomorrow, so here’s the new trade in Virtu Financial (VIRT). Also, we are closing TWTR and INTC – see trade details below for all three.

Trade Details:

November 27, 2020 - 4:14 pm

Insiders,

No video recap today due to the short week (and not much action). We’ll have a new OFT Pro issue next week, with the strong possibility of closing INTC and TWTR for profits. We also have our Insider butterfly trades in MS and TLT which both expire next week and are both currently in-the-money. We’ll see what next week brings. Have a great weekend!

November 24, 2020 - 2:47 pm

Insiders,

Time for new trade! Let’s mix things up a bit and do a trade in Morgan Stanley (MS). Banks are getting a huge boost today, at least in part due to having Yellen nominated as Treasury Secretary. While MS is at 52-week highs, it still is one of the most favorable valuations of the big banks. We’re going to do a 10-day butterfly that is slightly bullish. That it is, we’ll make money if MS stays at these levels or moves a bit higher. The profitable range for this trade, which expires a week from Friday, is from roughly 62.35 to 64.65 (the stock is around 62.80 at this time). Max loss is just the 35 cents or so we pay for the trade, which happens if we are below or above this range at expiration. Max gain is at 63.50 and will pay about 1.15. If you haven’t done a butterfly before, just make your order entry screen look like the one below.

November 20, 2020 - 4:07 pm

Insiders,

Weekly Recap Video is available at the link below. Have a great weekend!

Link:

https://content.jwplatform.com/videos/tG1KtzNE-bK67iJnL.mp4

November 18, 2020 - 5:09 pm

Insiders,

Market volatility ticked up a bit today as concerns over new Covid-19 closures outweighed the positive vaccine news. VIX futures (blue line) remain in a pretty flat term structure (except for the front month), which is generally a sign that traders don’t have a strong opinion on the direction of volatility. Meanwhile, the VIX index (green line) remains elevated compared to historical levels and is well above realized volatility for the last 10 days (yellow line). In other words, the markets haven’t been moving all that much, but options prices still suggest there is concern over potential upcoming volatility.

November 17, 2020 - 12:49 pm

Insiders,

It’s time for another TLT call butterfly because this is apparently the hill I’m willing to die on. I remain somewhat bullish on TLT, or at the very least, I don’t think it’s dropping below these levels for a sustainable period. The new December 4th TLT call butterfly details are below. Profitable range at expiration is between 158.75 and 163.25, with max gain at 161 of 2.25. Max loss is just the 75 or so we pay for the butterfly.

Trade Details:

November 16, 2020 - 5:44 pm

Insiders,

Here’s the trade for tomorrow’s OFT Pro issue – end of the year calls in INTC. See trade details below.

Trade Details:

November 13, 2020 - 3:55 pm

Insiders,

Weekly recap video is now available:

https://content.jwplatform.com/videos/h4q71V5Z-bK67iJnL.mp4

November 13, 2020 - 3:08 pm

Insiders,

Our TLT butterfly is in-the-money, so we need to sell it out to avoid exercising the long calls into stock. The price of the butterfly has been bouncing around quite a bit between roughly 20 and 40 cents. Obviously, the higher we can close the better since we spent around 90 cents on the trade. Regardless, the most important thing is getting the trade closed before the end of the day. The trade details are below, so if you’ve never closed a butterfly, make sure your trade looks like the one below. You can use whatever the mid market price is for the net credit, and then adjust it down a few pennies at a time until it gets filled.

Trade Details:

November 10, 2020 - 4:29 pm

Insiders,

There’s a lot to unpack this week, and the VIX term structure seems to agree. Looking at the flatness of the curve below (blue line), you can see that investors aren’t sure what to make of the situation. Between the election, the Senate runoff, and the vaccine, there’s a lot of info to digest. Let’s see what happens over the next week, but volatility may be sticking around for the time being (albeit at a lower level than before the election). The January hump in futures is due to the Senate runoff.

November 9, 2020 - 5:24 pm

Insiders,

Insane day in the options market, with the second most number of contracts traded ever (the highest day was Feb 28 of this year). The news of the Pfizer vaccine and its 90% effectiveness rate has totally changed the calculus on potential/current trades. First off, TLT cratered today as safe-haven assets like bonds and gold were liquated so make room for riskier trades (with higher return potential). Market volatility also plunged, so we’ll wait on doing any long volatility trades for the time being. In fact, it may be time to short volatility (for the short-term). We can still buy volatility into the Senate runoff election at a later date. For now, let’s be cautious. I see multiple trade opportunities opening up, and I’m excited about what the next few weeks may bring in terms of trades.

November 6, 2020 - 4:02 pm

Insiders,

It’s been a long week, but before you take a break for the weekend, here’s the link to the weekly video recap:

https://content.jwplatform.com/videos/ErnNPVab-bK67iJnL.mp4

November 6, 2020 - 3:06 pm

Insiders,

Our VXX call butterfly is fully in-the-money now that VXX has blown through all the strikes. That means we need to close it to make sure we don’t get assigned on our short calls. I’m going to send out the closing trade now, but you can wait a bit longer to see if we bounce back into the profit range. Just make sure you close no matter what before market close (in an hour). If we close now, you should be able to get between 5 and 10 cents for a credit. Make sure you make your closing order look like the order form below. Also, you may need to move your prices around a bit to get filled.

Trade Details:

November 4, 2020 - 6:43 pm

Insiders,

We’ll discuss in more detail when the election is official, but just wanted to give you a quick glance at volatility post-Election Day. It’s come down quite a bit with the front month now lower than the next month (contango). However, the latter part of the curve is still in backwardation and I think volatility may creep up a bit when election fatigue fades and investors start to consider the economic damage from the increasing pandemic cases.

November 2, 2020 - 4:52 pm

Insiders,

The new OTF Pro trade for tomorrow is a December call in TWTR. See trade details below.

Trade Details:

October 30, 2020 - 3:55 pm

Insiders,

It’s been a busy day for texts, but here’s one more. The weekly video recap is up.

Here’s the link:

https://content.jwplatform.com/videos/99z6f1BX-bK67iJnL.mp4

October 30, 2020 - 2:06 pm

Insiders,

We’re closing BDN for 125% gains. Trade details below:

Trade Details:

October 30, 2020 - 1:42 pm

Insiders,

Okay – here’s the short volatility trade I promised for election week. VXX puts have become pretty expensive, so we’re actually going to use a one-week put butterfly for this trade. I expect short-term volatility to selloff sharply next week after the election. However, I think mid-month volatility (basically the months early next year) will continue to stay elevated due to COVID-19. As such, the second part of this trade will be a call trade in VIXM (mid-curve VIX futures). We’ll place that trade on Monday or Wednesday next week most likely – I haven’t made up my mind for sure on the timing.

Getting back to the VXX trade, see trade details below. It’s a 5-point wide butterfly, so for a cost of 67 cents, we’re looing at a profitable range between 21.67 and 25.33 by next Friday. Max loss is only the 67 cents we spend on the trade and max gain is 1.83 if we land on 23.50 next Friday.

Trade Details:

October 29, 2020 - 5:25 pm

Insiders,

We saw the VIX drop from 40 today, but it is still at an extremely elevated level. Anything over 30 suggests quite a bit of volatility, and we’re well above that for now . Futures are actually lower, possibly in anticipation of volatility dropping after the election next Tuesday. You can see in the chart that the futures covered quite a big range today, so volatility itself remains volatile. That’s generally what happens when traders don’t know what to expect. In other words, trade safe out there.

October 28, 2020 - 2:11 pm

Insiders,

Okay – so volatility has exploded higher and our VXX call spread is now within 25 cents of max gain. No reason to wait at this point, let’s go ahead and close it and lock in the profits. We paid about 58 cents for the spread and are selling for around 2.25… that’s a 288% gain. Closing trade details are below.

Trade Details:

October 27, 2020 - 4:52 pm

Insiders,

Both our TLT and VXX positions are in-the-money. We have some time yet on the TLT trade, but the VXX call spread expires at the end of the week. It’s worth about $ 1.30 now, and we paid $ 0.58, so we could be closing tomorrow for over 100% gains. I’ll send out a text alert with the closing trade details, and it will likely be tomorrow, but may be Thursday at the latest. On Friday, we’ll likely take the opposite position, going short volatility into the election, but only for the week.

October 23, 2020 - 4:25 pm

Insiders,

New Weekly Video Recap is up! Have a great weekend.

Link:

https://content.jwplatform.com/videos/4odR8L72-bK67iJnL.mp4

October 23, 2020 - 2:15 pm

Insiders,

Trade Alert! Our TLT butterfly that expires today will be out-of-the-money (no action needed). However, I think it’s an even better opportunity to buy a call fly on TLT now with it below $ 158. We are going to put this position back on but with a few changes. First off, we’ll go out to November 13th to give this thesis more time to work. Secondly, we’ll spend a bit more (about $ 0.90) to buy a wider butterfly. that means max profit is around $ 3.10, while max loss is still just $ 0.90. The profit range will be $ 158.90 to 5.10, so a nice wide range for the next few weeks. If you don’t know how to place the butterfly trade, just follow the screenshot exactly as seen below.

Trade Details:

October 23, 2020 - 1:42 pm

Insiders,

We’re closing two OFT Pro positions AMKR and DAN. AMKR is a solid winner and DAN is either a winner or a small loser (depending on if you made both trades or just the second one). Trade details below.

Closing Details:

October 22, 2020 - 5:08 pm

Insiders,

Don’t forget to come to our live session tonight (in about 3 hours). We’ll talk about TLT, which is looking like a big time bounce back candidate. While our TLT butterfly is going to expire out-of-the-money tomorrow, I think there could be an even better opportunity for a new TLT trade. Bond prices have fallen too far and we’ll look to take advantage of it tomorrow.

October 20, 2020 - 4:51 pm

Insiders,

First off, my apologies for not getting the OFT Pro trade out to you yesterday. I’ve been having intermittent internet issues (including a 3+ hour outage today…yay!), and in between outages, I simply forgot to send the alert. On the bright side, the issue seems to be resolved. In other news, the October futures will drop off the VIX term structure tomorrow morning, so we’re going to have a curve in pure backwardation. It could be a decent tailwind for our VXX position. We’ll definitely be watching volatility very closely heading into the election. I am inclined to place a short VXX trade (long puts) right before election day that expires the week of. Let’s see how things shake out in the meantime.

October 19, 2020 - 1:22 pm

Insiders (Trade Alert),

My plan was do a mid-curve VIX trade today using VIXM. However, I did some research over the weekend, and I actually think the strategy over the next two weeks is long VXX. When October futures come off the board in a couple days, the term structure will be more conducive to VXX going higher. Notice, this trade expires before the election, and that’s key. We’re likely to reverse this position on election week. But for now, we’re buying a call spread on VXX for October 30th. See trade details below for how to place this trade. The most you can lose is the $ 58 or so you spend on the trade, while max gain (at $ 25 or higher in VXX) is around $ 1.90 per spread. For those new to Insiders, VXX tracks the first two futures in the VIX term structure, i.e. short-term market volatility.

Trade Details:

October 16, 2020 - 5:11 pm

Insiders,

Weekly video recap is now up. I talk about a potential volatility trade for the election, open positions, and what we plan in OFT Pro for next week.

Link:

https://content.jwplatform.com/videos/hRJ2z8T9-bK67iJnL.mp4

October 16, 2020 - 2:48 pm

Insiders,

Our VXZ position will expire out the money today, so no action necessary on the butterfly. I’ve decided it’s best to wait until Monday to establish a new position (this time in VIXM) just in case we get some crazy news item that comes out over the weekend. So, be prepared for a new volatility trade on Monday.

October 15, 2020 - 2:58 pm

Insiders,

We have two open positions (TLT and VXZ). TLT expires next week and is doing quite well at the moment. VXZ expires tomorrow and is currently out-of-the-money, although that could change with the market down and volatility moving higher. There may still be a chance to roll VXZ, but if not, we will open a new long mid-curve futures volatility position – and I would prefer to use VIXM as it has become the more liquid ETF for mid-curve VIX futures. Why continue buying VXZ/VIXM? Part of the reason is that I want to have a short (put) VXX position on for after the election, and I’d like to have this VXZ/VIXM position as a hedge. So think of it as early positioning for a future trade, with the possibility of paying off if volatility spikes ahead of the election.

October 9, 2020 - 4:57 pm

Insiders,

My weekly recap video apparently got cut off before I could talk about DAN, so here’s a brief follow-up video:

https://content.jwplatform.com/videos/f5SVlgy4-bK67iJnL.mp4

October 9, 2020 - 3:59 pm

Insiders,

New video, recapping the past week for Insider and OFT Pro positions, is now available. We have some good news in OFT Pro!

Video Link:

https://content.jwplatform.com/videos/F6kAVjwl-bK67iJnL.mp4

October 8, 2020 - 2:22 pm

Insiders,

Barring some kind of major disruption, our TLT butterfly for will expire worthless tomorrow. No action is necessary. However, I want to extend this trade thesis, as I still strongly feel that bonds are going to rebound. We’re going to place another TLT call butterfly, but at lower strikes (since the TLT is now down to around $ 160 per share), which expires in a bit over two weeks. It will cost around $ 50 – $ 55 for one butterfly, which is also the max loss potential. Max gain is at $ 163.50 on October 23rd, which is around $ 200 per fly. The profit range is from roughly $ 161.50 to $ 165.50. See trade details below for how to place the trade. Keep in mind, this isn’t a roll trade. We are letting the existing TLT butterfly expire, and this will be a brand new call butterfly we place today.

Trade Details:

October 7, 2020 - 5:19 pm

Insiders,

You may have seen my article yesterday on MSTB. I want to reiterate to you all that I really like this new ETF. I’ve included a link to the feature sheet below. I love the concept of hedged equity products, and this one is the best one yet that I’ve seen. JP Morgan has a $ 15 billion hedged equity fund but I think the minimum investment is $ 1 million, so it’s nice to see a more accessible product. I like having hedged equity exposure in my long-term portfolio more than straight equity exposure as it will outperform during high volatility periods, while keeping pace during low volatility periods.

Feature Sheet:

https://www.lhafunds.com/mstb/FeatureSheet-1

October 5, 2020 - 6:55 pm

Insiders,

The new trade in OFT Pro tomorrow is a TLT call. See trade details below. We are also rolling out DAN to November and opening a new FRO position in February (the October FRO call is worth zero, so no need to roll it) – screenshots also included below.

Trade Details:

October 2, 2020 - 4:31 pm

Insiders,

New weekly recap video is up. Here’s the link:

https://content.jwplatform.com/videos/Ynorsqtz-bK67iJnL.mp4

October 1, 2020 - 6:56 pm

Insiders,

It’s a new quarter today, so for your viewing pleasure, here are the top 10 highest volume options names that traded today with high call volume (over 80%).

September 29, 2020 - 6:00 pm

Insiders,

We had a decent amount of intraday volatility today, with the broad market finishing down about a half percent. Breaking it down by sector volatility, you can see below that every sector still falls into the “moderate” range. Most of the rankings are in the 60th percentage, so still much higher than average. Tech remains the highest in terms of implied volatility, with utilities at the low end.

September 28, 2020 - 4:56 pm

Insiders,

Despite a nearly 2% move higher in stocks, overall market volatility didn’t move that much. In terms of the futures (blue line below), you can see the front of the curve barely shifted (grey line is the previous close). The back months flattened out somewhat, but not enough of a move to raise any flags. I still think there’s plenty of volatility ahead over the next month.

September 25, 2020 - 4:17 pm

Insiders,

The latest weekly recap video is ready for viewing at the link below.

Video link:

https://content.jwplatform.com/videos/LlbfG58X-bK67iJnL.mp4

September 24, 2020 - 1:58 pm

Insiders,

Trade Alert! I’ve been watching TLT (long-term bonds) for a while now. I think there’s a definite floor on bonds here, with the potential for some upside over the next couple weeks. We’re going to use a slightly bullish call butterfly to express that viewpoint in trade form. The October 9th 165-168-171 call butterfly will cost about $ 0.65, which is your max loss potential. Max gain is $ 2.35 if TLT settles at $ 168 at expiration. However, anywhere between $ 165.65 and $ 170.35 is profitable at expiration, which is why I love this type of trade structure. If you’ve never traded a butterfly before, just make sure to make it look like the trade entry screen below.

Trade Details:

September 23, 2020 - 4:14 pm

Insiders,

Big day for volatility, with the VIX climbing to 29. It’s good news for our VXZ call spread which is close to being profitable for all three trades (including the previous two roll outs). If you recently got into the VXZ trade, you should be way ahead at this point (and feel free to take profits). The upcoming election is looking like even more of a high volatility period, so expect VIX to remain elevated for the next several weeks. The futures curve for VIX (blue line below) is in pretty steep backwardation (sloping down from right to left), outside of the front two months which looks like it does because of the election. That’s definitely a sign of concern among the volatility trading crowd.

September 21, 2020 - 6:38 pm

Insiders,

Here’s the new trade in tomorrow’s OFT Pro!

Trade Details:

September 18, 2020 - 4:28 pm

Insiders,

Things are starting to heat up as we approach the one-month mark to the election. Check out the weekly recap video (linked below) for updates on all our open positions.

Video link:

https://content.jwplatform.com/videos/PRKBIPqz-bK67iJnL.mp4

September 18, 2020 - 11:15 am

Insiders,

Let’s go ahead and close our GDX butterfly now that it’s a solid winner. You’ll want to make sure to close it today no matter what so you don’t end up getting assigned on any shares. Just follow the screenshot below if you’ve never closed a butterfly before. You may need to move the price a bit to get filled, but it should be in the ballpark of the prices below. We paid 58 cents for the butterfly and are closing it for 1.00. That’s a 72% winner on this trade.

Trade Details:

September 17, 2020 - 2:29 pm

Insiders,

We are in the money in our VXZ trade, but I think it’s going higher, so let’s roll it out another month. I prefer to close this spread closer to max value if possible (around $ 37 or higher) – and given the current volatility regime, it’s certainly possible. We can also the roll the spread as-is to October for only around $ 0.50, so it wont’ add too much to our total cost. If you’ve never rolled a spread, just make the order screen look like the one below. You can also do it as separate transactions if that’s more comfortable for you. (If you can’t get filled around $ 0.50, bump up the limit order by 5 cents at a time until it does get filled.)

Trade Details:

September 16, 2020 - 7:10 pm

Insiders,

Just in case you are wondering if investors are willing to take risks in this environment, I give you the first day of trading of Snowflake (SNOW). The cloud data company was priced at $ 120 per share and closed at $ 253.93, a gain of 112%! The company was valued at $ 12.4 billion in private valuations but is now trading at an implied value of over $ 70 billion. This reminds me a lot of the late 90s with dot com stocks – hopefully it doesn’t end the same way.

September 15, 2020 - 6:55 pm

Insiders,

We’re back to down to VIX at 25 after hanging out at 30 or above for just about a week. I think market volatility will continue to bounce around as we approach the election. You can see the cliff in the VIX futures term structure below that is 100% due to the election coming up. Once October futures are the front month, the curve will be in backwardation (sloping down from right to left), but most of the movement will probably be the entire curve shifting up or down. Meanwhile, 10-day realized volatility is still high due to the action last week. The VIX is predicting something a bit lower looking ahead, but that can change in a hurry.

September 11, 2020 - 4:33 pm

Insiders,

The latest weekly recap is reading for viewing. We discuss the open positions in OFT Pro and Insiders.

Video Recap Link:

https://content.jwplatform.com/videos/Dyn30s8H-bK67iJnL.mp4

September 10, 2020 - 2:58 pm

Insiders,

Trade Alert! I finally found a trade I like. We’re going to do a short-term call butterfly in GDX (gold miners ETF). This is more of a traditional butterfly in that we are already in profit range (I often like to use out-of-the-money butterflies, so this is a bit different). It’s slightly skewed towards bullish behavior over the next week – but if GDX remains between roughly $ 41.60 and $ 44.40, we can profit by next Friday. Max gain is at $ 43 (about $ 1.40) and you can only lose what you spend on the trade (about $ 60). If you’ve never done a butterfly trade before, make sure you make your order screen look like the one below.

Trade Details:

September 8, 2020 - 3:33 pm

Insiders,

Just a reminder that stocks can only trade irrationally for so long before the prices revert to something more fundamentally sound (even if for just a short period of time). If you trade stocks like TSLA, please be careful!

September 8, 2020 - 12:17 pm

Insiders,

For the roll trades I sent out yesterday, I accidentally used “Sell to open” instead of “Sell to close” for the September options. Here are the corrected screenshots – everything else stays the same, although the SLG price looks to be a bit higher than yesterday with the stock dropping today. Sorry for any confusion!

Trade Details:

September 7, 2020 - 5:05 pm

Insiders,

It’s hard to say how crazy (or not) the market is going to be tomorrow. However, here are the trades going out in the OFT Pro issue at some point during trading hours, with prices that will hopefully be in the ballpark of where the market opens. The first one is the new trade in Dana (DAN). The next two are roll trades for SILJ and SLG.

Trade Details:

September 4, 2020 - 3:51 pm

Insiders,

I was planning on doing a trade today, but the market action has been intense, and with a 3-day weekend, it makes sense to see where we are on Tuesday before committing to anything. The selloff didn’t happen soon enough or far enough to cash out our AMD put butterfly, so that one will expire (and no action needed). On the other hand, the VXZ call spread is in-the-money with a couple weeks to go before expiration. I talk about our positions and the market in the weekly recap video, linked below.

Video recap link:

https://content.jwplatform.com/videos/6Srh5gFR-bK67iJnL.mp4

September 3, 2020 - 5:36 pm

Insiders,

Finally a real selloff today in stocks. We may actually get a chance to close the AMD butterfly tomorrow if we have another big down day. Our VXZ spread is also doing quite well – finally. You can see the big shift up in the front part of the VIX futures curve below (from grey to blue). The VIX itself (green line) also climbed all the way into the low 30s. Clearly, there is real concern of a pullback, especially in tech. The last few days of higher volatility moves seem to have been predicting this drop, which is why it’s always a good idea to follow the VIX.

September 2, 2020 - 7:38 pm

Insiders,

Presented without (much) comment. AAPL is now worth more than the entire Russell 2000.

September 1, 2020 - 7:10 pm

Insiders,

First off, AMD is on a tear, so our put butterfly is going to expire worthless. No action will be necessary if you made that trade. On the other hand, volatility has been on the rise, so that’s good for our VXZ call spread. This is still a challenging market to trade if you don’t own TSLA or AAPL (among a few other big tech names), but I have some interesting ideas for Insider trades, one of which we’ll do this week. In the meantime, here’s a look at the VIX term structure. Implied/forward-looking volatility (green line) and futures (blue line) continue to move higher, while realized volatility (historical volatility) has just barely ticked up (the red and yellow lines). We’re going to paying close attention to this for the next several weeks to see if there are any clues that the market may be getting ready for a pullback.

August 31, 2020 - 5:08 pm

Insiders,

Market volatility is starting to get interesting, finally. Not only is volatility going up, but the gap between implied volatility (forward looking) and realized volatility (backward looking) is at extreme levels (the difference between the green and yellow lines in the chart below). Something has got to give, but the question is when. I think the notion of a peaceful pre/post election period is now out the window, so I imagine forward looking volatility is a better reflection of what to expect than what has actually been happening. Regardless, the stock market is no way reflecting reality these days, so it’s nearly impossible to guess what’s coming next.

August 28, 2020 - 4:51 pm

Insiders,

Volatility was interesting this week even if the stock market was not. Going to be curious to see if the strange volatility action will lead to some actual movement in the stock market for a change. In the meantime, have a great weekend! The link to the video recap is below.

Video recap link:

https://content.jwplatform.com/videos/tCpRlYBt-bK67iJnL.mp4

August 27, 2020 - 1:47 pm

Insiders,

Just a reminder that our live session is tonight. We’ll talk about our open positions, take a look at the state of market volatility, and look at some options theory.

Here’s the link – no registration required:

https://us02web.zoom.us/j/851872273

August 25, 2020 - 6:40 pm

Insiders,

We haven’t looked at the VIX term structure in a while, but mostly because nothing has really changed. As you can see below, VIX index price is still around 22, and the futures curve (blue line) is still higher, with a hump that covers the election future contract. Meanwhile, realized volatility over the last 30 days (red line) is significantly lower. I expect this situation to hold until the election unless there’s major market moving news before then (which is entirely possible of course).

August 24, 2020 - 6:34 pm

Insiders,

Here’s the new trade in OFT for tomorrow. I’m trying to mix things up a bit, so we’re going with October calls in Alcoa (AA). See trade details below.

Trade Details:

August 21, 2020 - 4:26 pm

Insiders,

I give a fairly in-depth review of our current positions in both OFT Pro and Insiders in the weekly video recap, linked below.

Video Link:

https://content.jwplatform.com/videos/tLMpcAJK-bK67iJnL.mp4

August 20, 2020 - 1:35 pm

Insiders,

Trade Alert: TJX dropped after earnings, but not enough for our puts to pay off. We are opening new puts in September at the 50 strike and letting the August puts expire. See trade details below – keep in mind, no action necessary on the August puts.

Trade Details:

August 20, 2020 - 12:42 pm

Insiders,

We finally have an up day for VXZ, but it comes with a day to expiration. We need to roll out the spread, as it finally looks like the market may be showing some weakness. The screenshot of the trade entry details looks complicated, but it’s simply closing the current spread and opening up a new one in September. In total, rolling the spread should cost about 75-80 cents, but you may need to adjust your limit order if it doesn’t get filled after the first 30 minutes or so. We are changing the spread from 33-36 to 33-37 in order to give us a bit more upside potential. The most you can lose on this iteration of the trade is the money spent at execution. The max gain is $ 4 (the width of the spread) minus whatever you pay. Max gain occurs if VXZ is at 37 or above at expiration.

Trade Details:

August 18, 2020 - 4:53 pm

Insiders,

What crash in March? Not only has the S&P 500 recovered everything it lost in the COVID crash, but it has actually set all time highs today. This marks the shortest bear market in history, and I use the term bear market loosely. Does that mean all is well in the land of stocks? Only time will tell, but I’m not sold just yet. The success of stocks is still very focused on a few areas (like tech and precious metals). Still, you can’t argue with history. Plenty of risk left on the table though, so don’t forget to use proper risk management practices when investing.

August 17, 2020 - 4:20 pm

Insiders,

Let’s take a look at YTD performance of major asset classes (as measured by future prices). The leading performer right now is lumber, which may come as a surprise to many – unless in you’re trying to build a house. The worst performer is heating oil (diesel), with oil-related products all struggling to date. Silver and gold continue to sit near the top, as does the Nasdaq 100. The S&P 500 is now up over 4% for the year, which is pretty impressive considering we had a literal crash in March.

August 14, 2020 - 3:28 pm

Insiders,

It ended up being a mostly quiet week in stocks, although metals (gold and silver) were definitely volatile. We talk about this and our open Insiders and OFT Pro positions in the weekly video linked below.

Video Recap Link:

https://content.jwplatform.com/videos/HsiadleX-bK67iJnL.mp4

August 13, 2020 - 3:01 pm

Insiders,

Let’s make another trade! I love AMD. Great company. Great product. However, the run higher recently has gotten out of control. As good as AMD is, it’s not a $ 100 billion company just yet. I think the stock pulls back a bit over the next 3 weeks. We’re going to use a put butterfly to keep our costs low on this trade. If you’ve never done a butterfly trade before (and you can trade spreads in your account), just make your order look exactly like the trade below. You can only lose what you spend on this trade (about $ 45 per butterfly). Max gain is at $ 70 share price at expiration and would be around $ 4.50. To be profitable we want AMD to be in the range between roughly $ 74.50 and $ 65.50 at expiration.

Trade Details:

August 12, 2020 - 3:56 pm

Insiders,

With the market about to close, let’s look at the top 10 highest options volumes for the day. No real surprises, with the possible exception of AMD (which has been on a tear lately). TSLA will continue to be really active with the 5 for 1 split announced. Of course, GLD and SLV remain very active. (Chart provided by our friends over at Marketchameleon.com.)

August 11, 2020 - 3:33 pm

Insiders,

We’ve been waiting for a selloff in the market, and there finally was a big down day today – but not in stocks. Instead, investors seem to be dumping precious metals, especially silver. You can see the bottom four performing futures today in the table below. They are all precious metals! So what’s going on? It could be a shift into riskier assets with the pandemic concerns (possibly) lessening. Or, maybe it’s as simple as finally seeing a down day means a bunch of investors are taking profits on their precious metals positions after a nice run. Will the selloff continue in metals? We’ll see as the week progresses, but my feeling is buyers will return to gold and silver as long as we continue to have negative real yields on bonds.

August 10, 2020 - 5:58 pm

Insiders,

The new OFT trade tomorrow is in junior silver miners (SILJ). I also have roll out trades for both WELL and SLG. See trade details below.

Trade Details:

August 7, 2020 - 4:51 pm

Insiders,

Pretty boring week in terms of market action – but could this be the calm before the storm? I talk about the market and our open positions in the video recap, linked below.

Video Link:

https://content.jwplatform.com/videos/8SBnZxJb-bK67iJnL.mp4

August 6, 2020 - 6:42 pm

Insiders,

This quote is from the the Wall Street Journal, regarding fractional share trading:

Fidelity Investments, which rolled out fractional trading to customers in January and February, says more than 340,000 of its accounts have placed a fractional trade, in which the customer buys or sells less than an entire share. Interactive Brokers Group Inc., IBKR -1.99% another online brokerage, says around 117,000 users have enabled fractional trading since the firm released the feature to individual investors in November. Charles Schwab Corp. SCHW -2.59% says more than 60,000 accounts have bought its “Stock Slices” since it turned on the feature in June.

The article goes on to say that fractional trading has amplified gains in expensive stocks like AMZN and TSLA. I believe this also supports why AAPL is willing to do a 4 for 1 split since they know it will appeal to the smaller investors. Interesting stuff because it’s almost entirely based on trading psychology instead of fundamentals.

August 6, 2020 - 3:10 pm

Insiders,

NIB has been on a tear, so I believe it’s a reasonable time for us to take profits. At the current price ,we’re looking at 164% gains in about 10 days. Trade details below.

Trade details:

August 4, 2020 - 4:52 pm

Insiders,

From our friends over at Marketchameleon.com, here’s a list of stocks with earnings coming up over the next two weeks where the expected move in the stock after earnings is lower than its average from the last 4 quarters. In a nutshell, you can figure out the expected move in a stock (either up or down) based on options prices with an expiration after earnings. If the expected move is noticeably less than what the stock has actually done on average over the last four quarters, it makes this list. These stocks may be worth buying straddles or strangles on for earnings, or doing long directional trades if you have an opinion on what earnings will show.

August 3, 2020 - 2:31 pm

Insiders,

I’m still convinced there’s more volatility ahead, but instead of trading VXX calls or SPY puts, we’re going to go with VXZ this time. VXZ is an ETN that tracks the middle part of the VIX futures term structure (months 4 through 7). It will stay elevated because of the election, so there’s not a lot of downside risk. However, if we do get a bump in volatility, the whole VIX curve with shift up and VXZ will go up with it. We’re doing a simple 33-36 call spread expiring August 21st. It should cost around $ 0.75, which is the max loss potential if VXZ ends up below $ 33 at expiration. Max gain is $ 2.25 if VXZ is at $ 36 or higher at expiration. If you can’t do call spread (vertical spreads) in your brokerage account, you can do the 33 call on its own. It will cost more (around $ 1.40), but it’s a reasonable alternative to the the call spread.

Trade Details:

July 31, 2020 - 4:25 pm

Insiders,

There was no action necessary on our expiring VXX and SPY trades (unfortunately). The market has remained resilient despite our best efforts to will it lower with our options trades. We’ll take a pause on trades for the weekend, but we will look at other ways to make money starting next Monday. I talk about this and more (including all of our OFT Pro positions) in the weekly video recap, linked below.

Video Link:

https://content.jwplatform.com/videos/6Fnv3Zhm-bK67iJnL.mp4

July 30, 2020 - 5:05 pm

Insiders,

This just in… the market is never going down ever again! Hooray!

Okay, I’m obviously being sarcastic, but the earnings from the Big 4 companies reporting tonight were all fantastic. After hours moves in AAPL, AMZN, and FB all suggest much higher opens tomorrow (with GOOGL up a bit as well). Heck, AAPL even announced a 4-1 stock split! We haven’t seen a split of a market leader in as long as I can remember.

There is some major euphoria in big tech names right now – the question is will it make its way to the rest of the market? We shall see soon enough.

July 28, 2020 - 4:27 pm

Insiders,

Ever wonder what sort of volatility products are available to big dollar clients? I came across an interesting product that has performed brilliantly this year. It’s a brand new fund in 2020 called the Smart Vol Strategy. Check out these results:

131% year to date! It’s actually a very cool product. The fund mangers use volatility ETFs and options (VXX, SVXY) as well Treasury and Gold Miner ETFs (TLT, GDX, IEF, DUST, TMV) to create various indicators to set their volatility allocation. They always have an allocation of OTM VXX calls to protect against extreme events when they hold short vol positions. They do something similar with gold miners and Treasuries as well. Whatever they are doing, it’s clearly working. The drawback – you need $ 50k minimum to invest. That’s generally a much lower number than what you need to get into a hedge fund, but obviously a significant amount for most investors.

Here’s the website if you are interested in learning more about the product:

https://www.investinvol.com/smartvol

July 27, 2020 - 5:56 pm

Insiders,

The new trade for tomorrow (OFT Pro) is the September 28 calls in NIB (the cocoa ETF) for $ 1.10! See the screenshot below. There are no other adjustments (rolls or closing) in any of our other positions.

Trade Details:

July 24, 2020 - 4:42 pm

Insiders,

Please ignore the previous video link – I accidentally cut off the video about halfway through. Here is the link to the full video recap:

Video Link:

https://content.jwplatform.com/videos/xQhYmuIL-bK67iJnL.mp4

July 24, 2020 - 4:19 pm

Insiders,

Two down days in a row! Amazing (sarcasm intended).

I talk about our positions and a bit about the market in the weekly recap video. I also give some hints on the next trade in OFT Pro coming out on Tuesday.

Video Link:

https://content.jwplatform.com/videos/XrUKEbzX-bK67iJnL.mp4

July 23, 2020 - 5:52 pm

Insiders,

Don’t forget the Options Insider live session is tonight! I’ve included the link here, but you’ll also get an email soon with the link as well. No registration is required and we’ll get started at 8 pm EST. I should have plenty of time for Q&A, so bring any options or market-related questions you have!

Zoom Link:

https://us02web.zoom.us/j/851872273

July 22, 2020 - 7:38 pm

Insiders,

Tesla (TSLA) earnings came out after close and were better than expected. Microsoft (MSFT) also beat earnings expectations, but cloud business is slowing a little. As of this writing TSLA shares were up 4% after hours and MSFT was down a little over 2%. Interesting side note, TSLA’s implied earnings move was 13.5% and it only has moved 4% in the after hours market. I would expect there to be a much bigger move when the market opens, but we shall see. At this point, it looks like buying a TSLA straddle would have been a big mistake (considering it cost about $ 200 per straddle). Let’s how it looks tomorrow.

July 20, 2020 - 4:43 pm

Insiders,

Mostly a slow day for the market, with a big day for Nasdaq stocks, which hit another record high. Meanwhile, volatility is beginning to look a lot like it wants to be sold (which really makes me nervous). Front month contango (the difference between the first and second futures) is now over 11%. However the front month expires tomorrow, so we’re probably looking at closer to 5% contango. I’d still rather be a buyer than a seller of volatility right here, but it’s becoming more difficult to stick that view given how stocks are currently behaving. Besides the contango below, look at how far volatility dropped today – pretty much the entire curve.

July 17, 2020 - 4:40 pm

Insiders,

Pretty quiet week overall – almost too quiet. I kind of expect some fireworks next week just because of how slow this week turned out to be (relative to the past several weeks). Overall, I’m happy with how we are positioned in both the OFT Pro and Insiders portfolios. I discuss in more detail in the video recap below.

Video Link:

https://content.jwplatform.com/videos/6OmQVgrO-bK67iJnL.mp4

July 16, 2020 - 2:07 pm

Insiders,

Not one but two trades today! Along with the VXX call spread, we are going to add a SPY put butterfly (as long as you have permission to trade spreads in your brokerage account, you can also make this trade). If the recent pattern continues, then I expect to see SPY test that $ 300 level again in the next two weeks. We are going to center a put butterfly around the 300 strike in anticipation of this price action. Remember, with a butterfly you can only lose what you spend on premium (should be around $ 0.78 per butterfly). Max gain is $ 10 – the price paid for the butterfly if SPY settles at $ 300 at expiration. The profitable range is $ 290 + butterfly cost and $ 310 – minus butterfly cost (at expiration). If you’ve never made this kind of trade before, just follow the screenshot below and remember to sell double of the center strike.

Trade Details:

July 16, 2020 - 1:48 pm

Insiders,

Let’s do a couple trades today! First off, we’re going to roll out the VXX call spread. To do so, we need to close the 32-35 call spread (expiring tomorrow) and open a new one. We will use the July 31st expiration for a next trade and we’ll move the spread up one strike and widen it out from 3 strikes to 4 strikes. In other words, we are rolling the 32-35 call spread expiring tomorrow to the 33-37 call spread expiring at the end of July. It should only cost about 40 cents to do so. Please set up your trade exactly as seen in the screenshot below. If you weren’t in the original VXX 32-35 spread, feel free to use this opportunity to open the July 31st 33-37 spread. I will also send another new trade in a separate text alert, so keep an eye out for that.

Trade Details:

July 15, 2020 - 7:01 pm

Insiders,

Market volatility (as seen through the VIX) had been holding up recently despite stocks behaving bullishly. However, it looks like volatility took a dive by the end of the day today, as you can see in the chart below. The VIX futures curve shifted from the grey line to the blue line today, which is a pretty sizable move down. The VIX itself (green line) also dropped from close to 30. Will we go a whole week without a stock selloff? We’ll know soon enough.

July 14, 2020 - 6:45 pm

Insiders,

The big news after hours is the positive vaccine news from Moderna (MRNA), with what appears to be solid progress on a COVID-19 vaccine. The stock is up to $ 86 after close, up 15%. It has gone from $ 18 in February to where it is tonight. The stock has a high enough valuation ($ 30 billion) for it to be added to the Nasdaq-100, which will result in even more buying of the shares so it can be added to index funds. I’m going to go ahead and give you my strong opinion on this company: I think the current valuation is a joke. I mean, I hope the vaccine works for all of our sakes, but not for one second do I think this stock should be valued at $ 30 billion. There’s probably too much positive momentum to risk taking a bearish position on MRNA right now (although long-term bearish is reasonable). But, let me present to you the list of insider transactions since June 1st for your perusal – with no further commentary necessary:

July 13, 2020 - 5:37 pm

Insiders,

The OFT Pro issue comes out tomorrow so here is the new trade (a put in SLG) plus the 3 maintenance trades (rolling, etc.) in the issue (for HA, WELL, and FRO).

Trade Details:

This last trade is the rollout trade for Welltower (WELL):

July 10, 2020 - 5:04 pm

Insiders,

The market closed off the week on a high note, with the S&P 500 up about a 1%. Volatility also dropped, with the VIX down to about 27. Expect more choppiness ahead as we close in on earnings season. I discuss the market and our open positions in the video recap below.

Video Link:

https://content.jwplatform.com/videos/WwxVGGrU-bK67iJnL.mp4

July 9, 2020 - 3:12 pm

Insiders,

Either I’ve spent too much time in quarantine, I haven’t had enough coffee, or some combination of both, because I messed up on the math for the closing trade on BXP earlier. If we sold it for $ 3.20 net credit, we made $ 1.90 on the trade, which is still a decent amount away from max gain of $ 3.70. Profits are 146% on the trade, not 246%. That being said, I still think closing it here is the right move. After a couple big down days, I have concerns about the stock bouncing, and expiration is next week (and the gains are still solid).

Sorry for the confusion. I’ll drink more coffee next time before I send any trade alerts.

July 9, 2020 - 1:27 pm

Insiders,

BXP has dropped all the way through our 85-90 put spread. We can close it now for pretty close to max gain. You should be able to get a credit around $ 3.20 to close and max gain is $ 3.70. I think we are close enough to max gain that it’s worth taking profits now. We are looking at roughly 245% profits here. See closing trade details below.

Trade Details:

July 8, 2020 - 1:47 pm

Insiders,

I just sent a closing alert to my publisher for EGO. Close now for 225% gains. See trade details below.

Trade Details:

July 7, 2020 - 6:20 pm

Insiders,

Sometimes the market teaches us harsh lessons. One of those lessons, which I constantly have to relearn, is to buy extra time on trades whenever possible. For instance, last week our long-shot NKLA trade (20-30-40) put butterfly expired after the stock spent most of the trade duration around $ 70. Well, today, just two trading days after expiration NKLA is at $ 40. Buying one extra week for probably no more than 25-50 cents would have made all the difference. On the other hand, now that my thesis is finally playing out, I’m wondering if we may be able to cook up another NKLA trade after all. Stay tuned!

July 6, 2020 - 6:19 pm

Insiders,

Although the market was up today (S&P 500 up 1.5%), volatility was also up. The VIX climbed 26 cents, which isn’t much, but the fact that it was up at all on a big up day for stocks is interesting. It could just be a factor of the long holiday weekend, but we should know more tomorrow. Contango between the front month and the second month also lessened a small amount (became flatter). I wouldn’t be surprised to see a selloff tomorrow or soon after – but of course, major news items can change market sentiment in a hurry.

July 3, 2020 - 4:26 pm

Insiders,

Here’s a short video recap of our Insiders and OFT positions:

https://content.jwplatform.com/videos/dvwIzQA1-bK67iJnL.mp4

Enjoy your long weekend!

July 2, 2020 - 1:45 pm

Insiders,

I made a mistake with the last VXX trade order. It should be the July 17th spread, not the July 10th. If you already made the trade, you don’t have to make any changes. If you haven’t made the trade, I included the new trade below. It’s a little more expensive ($ 0.80) for July 17th expiration, but the strikes remain the same. Apologies for the confusion.

Trade Details:

July 2, 2020 - 1:21 pm

Insiders,

Market volatility has dropped heading into the long, holiday weekend. I think there’s a reasonable chance it bounces back next week (or the week after). We are going to try to take advantage of this by buying a call spread in VXX. It’s a two-week trade that will only cost us around $ 0.73 (potential max loss) but can net $ 2.27 (potential max gain) if VXX goes to $ 35 or higher by July 17th. Given the environment we’re in, there’s a very good chance we see volatility jump at some point prior to expiration, which makes this a relatively safe trade.

Trade Details:

July 1, 2020 - 4:33 pm

Insiders,

Pretty quiet day today in the markets as investors are likely taking it easy ahead of the long holiday weekend. Don’t forget, the markets are closed on Friday. Regarding our NKLA put butterfly, it will almost certainly expire worthless tomorrow, so no action will be required. I don’t intend to roll it out as it is too expensive of a trade to keep on. While I’m surprised NKLA stock continues to hold up, this trade was always a long shot. We won’t do many trades like this one, but every now and then, they can pay off in a big way. On a different note, I am considering doing a volatility related trade tomorrow if the market is reasonably calm. Stay tuned!

June 30, 2020 - 1:28 pm

Insiders,

I apologize for the confusion from yesterday’s post. The text alert system would not let me attach images, which didn’t help. That problem appears to be resolved, so I attached what a put spread would look like on TJX below. Keep in mind, you would do a put spread in lieu of the straight put trade on TJX recommended in the OFT issue. Buying the August 47.5 puts will cost you around $ 2.25, while a spread will only cost around $ 1.25. The difference is unlimited gain potential with the straight put, versus a cap of $ 3.75 with the put spread. No worries if you can’t do the put spread – nothing wrong with doing the put on its own. I just wanted to offer choices for Insiders who have the ability to do spreads.

TJX Put Spread Details:

June 29, 2020 - 8:02 pm

Insiders,

The new trade in the OFT issue tomorrow will be the August 21st 47.50 puts in TJX. (I’m having issues attaching the screenshot to the ticker.) The closing price from today was around $ 2.25. That’s more expensive than what I prefer to pay, so for those of you comfortable trading spreads, I strongly suggest using a put spread for this trade (something like the 42.50-47.50 put spread is reasonable).

June 26, 2020 - 5:41 pm

Insiders,

Cracks are starting to show up in the stock market… again. The S&P 500 was down nearly 2.5% today , and the VIX is back up close to 35. I think there could be a lot of noise next week (added volatility), but of course, we’ll have to see what the weekend brings. In the meantime, here’s the link to the weekly video recap:

https://content.jwplatform.com/videos/gbOs5Ln9-bK67iJnL.mp4

June 24, 2020 - 5:56 pm

Insiders,

Big jump in volatility today with the market down about 2.5%. COVID-19 concerns are once again driving market volatility (to the surprise of no one). What’s interesting is that 10-day realized/historical volatility was quite a bit higher than forward looking volatility (implied volatility)… until today. You can see the yellow line below (historical volatility) is right near the green line (VIX price), with the VIX futures in the same ballpark (blue line). Last week, the yellow line had separated higher than the green line, but the green line has now “caught up” to the yellow line. In other words, for once, the past may have accurately predicted the future.

June 19, 2020 - 5:20 pm

Insiders,

In this week’s video recap I discuss the current market conditions and volatility, our Insider positions, and the OFT Pro positions.

Here’s the link:

https://content.jwplatform.com/videos/tQXvtBDh-bK67iJnL.mp4

June 18, 2020 - 4:04 pm

Insiders,

Just a quick note on the USO put butterfly. Unless the price of crude oil collapses tomorrow, the entire spread will expire worthless. There are no actions necessary in this case. We can only lose what we spent on the trade, so there’s no risk in letting it expire. I’m not going to roll this trade out or place a new one. I’ve been dead wrong on oil and I think it’s best to step way from further oil trades at this time (except for the FRO trade in OFT Pro, which I still like).

June 18, 2020 - 2:42 pm

Insiders,

It’s time to have some fun with Nikola (NKLA). The electric/fuel-cell truck company is worth $ 21 billion according to the market, with precisely zero vehicle sales so far. I don’t know if the company will end up delivering on its promises, but the buying frenzy in the stock is unsustainable. We’re going to place a bet that the stock collapses within two weeks. Please note, this is not a high probability trade, nor is it cheap. If you are a more conservative trader, please skip this trade.

We will use an OTM put butterfly to make this trade, but it will still cost about $ 155 per butterfly. Every once in a while, it’s fun to take a shot for big profits. This is not the typical sort of trade I recommend, but the craziness in NKLA is too hard to ignore. With a butterfly, the most we can lose is the money spent on the trade (about $ 155). We can make about $ 845 at max gain, but more reasonably, we’re looking to double or triple our initial premium. I’m betting on a big fall, so we need NKLA to drop to between $ 38.45 and $ 21.55 to make a profit. (If you want to spend closer to $ 2 on the trade, you could do a 50-40-30 put butterfly instead. In fact, feel free to mess around with strikes and expiration dates to see the different price points and choose one most to your liking.)

Trade Details:

June 17, 2020 - 3:43 pm

Insiders,

I have a fun idea for a trade in Nikola (NKLA) we can do tomorrow, but it won’t be for the faint of heart. NKLA is an electric/fuel-cell vehicle company that is billed as the next Tesla. I have no idea if this company will become anything close to TSLA, but the options market for this recent IPO is crazy. If you make the trade I suggest tomorrow, be prepared for wide bid/ask spreads and difficulties getting filled on trades. Nevertheless, it could be a fun experience for those who like rolling the dice. Stay tuned!

June 15, 2020 - 6:05 pm

Insiders,

Here are the trades that are included in the OFT Pro issue that comes out tomorrow. The first trade in Eldorado Gold (EGO) is this issue’s new trade, while the trades in FRO and THC are roll out trades. See trade details below.

Trade Details:

June 12, 2020 - 5:44 pm

Insiders,

I talk about a range of topics in this week’s video including market conditions, mistakes I’ve made, HTZ, and of course, our open positions. Check it out!

Video Link:

https://content.jwplatform.com/videos/7rVWNvlv-bK67iJnL.mp4

June 11, 2020 - 6:05 pm

Insiders,

Well, we’ve been waiting for the other shoe to drop… and it seemed to happen today. The S&P 500 was down about 6%, and the DJIA shed almost 1,900 points. Bears were apparently just waiting for the Fed meeting to be out of the way before selling. After all, it’s not like the spike in COVID-19 cases has been a secret. This was the inevitable consequence of opening the economy (for better or for worse), which is why it was a surprise to see stocks jump higher so quickly after the March crash. The next step is seeing how the market reacts ahead of the weekend. You can see from the VIX chart that we’re suddenly back in backwardation. In fact, we went from 6% contango to 4% backwardation in one day. That’s no joke – and I’m certainly glad I didn’t recommend we buy those VXX puts that I was thinking about this week. On the other hand, our BXP position is now a winner! Be safe out there.

June 10, 2020 - 6:43 pm

Insiders,

Instead of commentating on the Fed decision today, let me just paste some key quotes from Chairman Powell:

“We are strongly committed to using our tools to do whatever we can and for as long as it takes to provide some relief and stability”

“We’re not thinking about raising rates. We’re not even thinking about thinking about raising rates”

And this quote from the Wall Street Journal sums it up:

“In new projections released Wednesday, all 17 officials who participate in the rate-setting meetings said they expect to hold rates near zero next year, and 15 of them projected rates would stay there through 2022.”

In other words, fixed income isn’t coming out of the toilet anytime soon. No wonder stocks only go up!

June 9, 2020 - 8:11 pm

Insiders,

Volatility has reversed higher the last couple days (despite mixed results in stocks). It remains to be seen whether or not this shift will hold, but it definitely breaks the recent trend in the VIX, which had dropped all the way below 25 before climbed back to current levels. The futures (blue line) and VIX index price (green line) are back expressing the same opinion (so to speak). 30-day historical volatility (red line) is now substantially lower than the VIX and VIX futures. It suggests the next month may be a bit bumpier than the past month. Let’s see how the rest of the week shapes up.

June 5, 2020 - 5:03 pm

Insiders,

The Nasdaq is at all time highs, so by looking at the market you would never know the world is still dealing with a pandemic and the US is seeing a major period of civil unrest. While civil unrest is generally short-term in nature, the effects of the pandemic could linger or worsen depending on the severity of the second wave. For now, the best path to take it to trade cautiously and focus on individual stocks rather than try to guess market direction as a whole. I talk about this and more in the weekly video recap below.

Here’s the link:

https://content.jwplatform.com/videos/MasmJl9b-bK67iJnL.mp4

June 4, 2020 - 6:41 pm

Insiders,

Below is clip from a WSJ article “Why Mr. Market Ignores a World in Turmoil” that I think sums up the situation pretty well. I’m still more bearish overall on stocks than bullish, but as always, it’s important to look at both sides of the trade to see if there’s a compelling counterpoint.

Here’s the clip:

Today’s question for the audience is: Why is the market rising even as U.S. cities burn, Hong Kong becomes a flashpoint in China relations with the West and the prospect of a second round of coronavirus infections remains real?

It is deeply uncomfortable to watch Wall Street party while Main Street emerges from lockdown into tear gas. The bullish story is that none of these problems matter nearly as much for stock prices as the good news for investors. Businesses are reopening while the Fed is providing unprecedented support and governments are subsidizing the economy to the tune of 11% of GDP in developed countries, Fitch Ratings calculates.

June 4, 2020 - 1:04 pm

Insiders,

Here’s the BXP trade I recommended last night during the webinar. If you missed the webinar or haven’t yet executed the trade, the price hasn’t changed that much, so now would be a good time to place it.

Trade Details:

June 3, 2020 - 6:21 pm

Insiders,

I saw an interesting, massive options trade today in KRE, which is a popular regional banking ETF. With the stock around $ 38, someone bought a gargantuan collar. A collar is a combination of selling a call above the price of a stock (that you own) and buying a put (or put spread) below the price. It’s a defensive trade meant to be a cheap way to protect your downside. The short call helps offset the cost of the long put or put spread. You are trading a potential cap on the stock price for not having to shell out a bunch of cash for put protection.

In this case, someone sold a September 45 call versus a 36-31 put spread (also in September) and paid about 30 cents for the whole thing. The eye-opening part is it was done 35,000 times. It could suggest KRE has both limited upside and limited downside for the next 3 months, which is interesting because regional banking stocks have been pretty volatile these last few months. We’ll keep an eye on it to see if there’s any trade opportunities there.

May 29, 2020 - 5:43 pm

Insiders,

A lot going on in the US and the rest of the world, so it will be interesting to see what Monday brings. In the meantime, check out the weekly video recap (linked below) to see where we stand on our open trades. Have a great weekend!

Video Link:

https://content.jwplatform.com/videos/hb2mJRxG-bK67iJnL.mp4

May 29, 2020 - 1:54 pm

Insiders,

For those of you still holding the MMM call spread, the stock is back above $ 150, so let’s go ahead and take profits on this trade. Most of you who made the trade bought the 145-150 call spread for around $ 1.65 and we’re closing it for around $ 3.60. (Some of you may have had the earlier trade – the 160-165 call spread – from March. If you had both trades, you probably ended up around even.) See trade details below for how to close the spread.

Trade Details:

May 28, 2020 - 2:26 pm

Insiders,

There’s no way to sugar-coat this – I was wrong on USO. I was excited about the put spread we did and it was based on the extreme contango in the crude oil term futures term structure. My strong belief was that contango would remain through May and into June putting pressure on USO’s price. What happened was twofold: the term structure flattened out much more than I expected based on bullish inventory numbers and the USO issuer started using a lot more back-month futures allocation than I would have guessed.

Our USO put spread expires worthless tomorrow, and I don’t want to repeat the trade as the fundamentals have changed. Nevertheless, there is still some contango in the curve (which is normal for USO) and I believe it will cause downward pressure on the price, but at a slower rate than my initial impression. So, instead, we are going to do a June put butterfly (standard monthly expiration) in USO. It will perform better than a put spread on a slow move down, and it will cost us substantially less. See the trade details below. You can only lose what you spend on the trade (about 60 cents) and max gain is $ 2.40 if USO goes to $ 21 at expiration. If USO is anywhere between $ 23.40 and $ 18.60, the trade will be profitable at June 19th expiration.

Trade Details:

May 27, 2020 - 7:37 pm

Insiders,

Just a quick reminder that although market volatility has come way down from its peak in March, we are still at elevated levels overall. Looking at the sector breakdown below, you can see that implied volatility is elevated across the board compared to normal levels. In fact, most sectors are around their 75% percentile rank (as compared to their 52-week average implied volatility).

May 27, 2020 - 11:28 am

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May 22, 2020 - 5:06 pm

Insiders,

We didn’t do any new Insider trades this week, but we will for sure next week. We have MMM and USO still on, which I discuss in the video below along with our OFT Pro trades. I’m still undecided on what to do with USO, but the ship has probably sailed on our put spread that expires next week (barring a major selloff). I’m thinking about doing a longer-term put butterfly on USO as a next step, but we need to see what the data looks like next week. In the meantime, many of the OFT Pro trades are performing nicely and we could have a couple to close next week. I talk about the entire portfolio in the video.

Enjoy the long Memorial Day weekend!

Weekly Video Recap Link:

https://content.jwplatform.com/videos/UqOHdaBY-bK67iJnL.mp4

May 20, 2020 - 6:22 pm

Insiders,

Looking at an update of the volatility term-structure (the VIX futures curve) and we can see the very picture of uncertainty. The futures curve (blue line) is flat (or about as flat as it gets). It’s roughly in line with the spot index price (green line), which is roughly in line with 30-day realized volatility (the red line). In other words, no one has really any idea of what’s coming next. The only consensus is that the next 30 days could look a lot like the last 30 days, which means moderate to high – but not extreme – volatility.

May 19, 2020 - 7:16 pm

Insiders,

I apologize for the radio silence. Been overwhelmed lately to the point I forgot to send out the OFT Pro trade preview yesterday. It actually worked out this time as THC has gone up and you probably got a better price on the put than what you would’ve gotten this morning. The other trade from the issue, closing AVYA, was also better (higher) when the issue came out, so that worked out as well. Regardless, I will continue to send out the trades the day before the next issue, with this week being a fluke.

I’ve been getting questions about USO, which we need to address soon. The position doesn’t expire until a week from Friday, but the shape of the crude oil term structure has changed recently, making puts in USO less attractive for the moment. I think the best course of action will be to roll the put spread into a longer-term position (maybe August). We’ll see how things look later in the week and I’ll send out a new trade at that time. I’m also looking at volatility trading situations, but with the VIX futures curve nearly flat, there isn’t an obvious play right now. As always, stay tuned!

May 15, 2020 - 5:52 pm

Insiders,

It was a fairly calm day, at least until after the close, when the Fed said it was concerned about a major drop in asset prices if the pandemic continues. That could make for an interesting weekend and open on Monday. We shall see… In the meantime, you can check out my weekly video recap, linked below!

Video Link:

https://content.jwplatform.com/videos/85QYyxVx-bK67iJnL.mp4

May 14, 2020 - 2:29 pm

Insiders,

Our VXZ call spread is going to expire tomorrow and we may end up in the money, so let’s close it. I’m not rolling it because I want to do a different sort of volatility trade instead (possibly next week). We need to close the spread because we don’t want to end up getting long the shares through automatic exercise if the spread expires in the money (above $ 36). Also, we may be able to get 20-25 cents or so out of the trade, which is worth doing now that commissions are so low. We have to close both the 36 and the 41 call because our brokers won’t let us remain naked short calls (by just closing the 36). To close the entire call spread, see the trade details below.

Trade Details:

May 13, 2020 - 5:24 pm

Insiders,

First off, just wanted to remind you that Tim, Eddy, and I are doing the members-only presentation tomorrow that we’ve done a couple times since March. It’s usually got a lot of great info between the three of us, so drop by if you can (12 EST/9 PST). Here’s the link:

https://us02web.zoom.us/webinar/register/WN_wZ1uZRiuTgy5_K0nqHEiLg

Also, just wanted to point out that volatility is on the rise again, with the VIX jumping from about 28 to 35 in just 2 days. Is the crowd starting to finally worry about bad news? It remains to be seen, but be cautious out there in your trading. Let’s see how the rest of the week plays out. We’ll look more closely at our VXZ position tomorrow and decide what to do.

May 12, 2020 - 12:50 pm

Insiders,

Boom! BXP dropped to $ 80 today, so let’s close our 85-80 put spread. I included the order below using the mid market price of $ 3.35, but you may be able to get a better price if you let your limit order sit in the market for a while. Regardless, using $ 3.35 as a closing price, we are locking in gains of 148%.

Trade Details:

May 11, 2020 - 6:55 pm

Insiders,

The market saw mixed action today, with the major stock indexes gaining ground after opening in negative territory. Volatility actually didn’t move much at all. Looking at the VIX futures, it seems the volatility crowd is still waiting for something to happen (hence the relatively straight line in futures – the blue curve). The term structure is in clear contango now (5% – front month future below second future), which means it may be safe to sell some short-term volatility on a weekly basis. If you go that route, I would hedge it with middle month volatility (like VXZ). You can also see historical volatility over the last 10 days (yellow line) is now well below the VIX index price (green line), so volatility traders think the future is going to be more volatile than the past (which is normal).

May 8, 2020 - 5:17 pm

Insiders,

The VIX has dropped below 30 for the first time since the crisis began in earnest. It remains to be seen whether this will be a signal to volatility sellers to pile into the short volatility trade or a chance for volatility bargain hunters to go shopping. I discuss this and much more on all of our OFT Pro and Insider positions in the video, linked below.

Weekly Recap Video Link:

https://content.jwplatform.com/videos/b1kPwjF3-bK67iJnL.mp4

May 7, 2020 - 1:03 pm

Insiders,

Let’s do some trading! I have new trade in USO that I’ve been watching for a while. But first off, let’s close our SLV trade. We’ve had the May 15th 13 call for a while now. With expiration approaching and silver prices in a holding pattern, I think we are safe to close out the position and take profits. If you close at the current price of $ 1.31, you will lock in 51% profits. See the closing trade details below.

Further down below is the trade details for a new USO put spread. The oil-term structure is still in contango and of course, there’s a major glut of supply. Oil is up today so it gives us a chance to get this put spread at a very attractive price. The (approximately) $ 0.76 you pay for the spread is also the max loss potential. Max gain is $ 3.24 if USO is below $ 16 at May 29th expiration. See trade details below for the opening the USO put spread.

Trade Details SLV:

Trade Details USO:

May 5, 2020 - 7:05 pm

Insiders,

Today was a pretty unremarkable day. 1% or less movement in the major stock indexes is downright boring after what we’ve seen in recent weeks. Nevertheless, the VIX (green line) remains elevated (predicting roughly 2% moves per day). Plus, the term-structure (blue line) is still in slight backwardation (front month future higher than second month). In other words, we didn’t do much today, but the volatility market is betting that we’ll still have plenty more volatility to come. I’m guessing we have some sideways action for a while, with things heating up (literally and figuratively) as we approach June.

May 4, 2020 - 5:55 pm

Insiders,

Big OFT Pro issue coming out tomorrow. The new trade is for June calls in Iron Mountain (IRM) a data storage REIT. We’re also rolling out NRZ and DRQ. I’ve included all the trade details below.

New Trade in IRM:

Roll Trades in NRZ, DRQ:

May 1, 2020 - 5:42 pm

Insiders,

A lot going this week once again, and next week could be very active for us (lots of rolling in OFT Pro, with a new trade in both OFT Pro and Insiders coming as well). I’ll let my video do the talking. See the weekly recap and market discussion at the link below:

Video Link:

https://content.jwplatform.com/videos/0vOblvdY-bK67iJnL.mp4

April 30, 2020 - 6:30 pm

Insiders,

Today may have indeed been a sell-the-news type situation, although the financial media was painting it as ‘”concerns over the economy”. Apple posted decent earnings but declined to give guidance and the stock is down after hours. I think we may have seen a temporary top this week. How far down are we going? That part is impossible to say without a crystal ball. However, volatility has picked up again as you can see from the chart below. Futures (blue line) are back in backwardation, which is what I suggested would be the case. The VIX itself (green line) is up from yesterday by about 3 points. Realized volatility (yellow) from the last 10 days has dropped quite a bit, so now we’re at the point where the market is predicting higher volatility than what we’ve seen lately. That shouldn’t be too much of a surprise as the last week or so has been eerily slow for trading during a pandemic (although we don’t really have anything to compare to).

April 29, 2020 - 6:42 pm

Insiders,

Very good news after hours from the world’s biggest company, Microsoft. As a tech giant that isn’t dependent on advertising (like Facebook or Google – although FB is also up huge on earnings as I type this), the company didn’t see much of an impact from COVID-19 this past quarter. They reported $ 35 billion in revenues and earnings per share of $ 1.40. Analysts’ expectations were for $ 33.7 billion and $ 1.26. This could definitely boost QQQ tomorrow (up 1.2% after hours as I write this with MSFT up 2.4%, FB up 9.4%). Watch out for a sell-the-news type day tomorrow though, as we’ve had a lot of positive news lately and sometimes that’s a sign for investors to take profits. This market has been anything but obvious lately, so use extra caution when making a trade.

April 28, 2020 - 6:19 pm

Insiders,

Let’s revisit the oil term structure a week after we saw negative oil prices for the first time ever. Cash (spot) price is under $ 13 per barrel and after a big drop today is sitting near the front month (June) futures contract price. There’s a large gap between June and July futures prices, and another decent-sized gap between July and August. This steep contango structure will be (and is) a serious headwind for USO. Once again, there are far better ways to take positions in oil than USO (which down to just over $ 2). I’m a big fan of oil tankers, hence the FRO position (which we may need to roll out to buy more time).

April 27, 2020 - 5:26 pm

Insiders,

Interesting move in volatility today. The slow(ish) market is taking a toll on the VIX. As you can see below, the spot price (green line) has dropped below 35 for the first time since the crisis began in earnest. It does make some sense give how realized volatility has dropped (yellow line). Futures don’t fully buy the move (blue line) as the front is actually higher than spot. The curve is still in backwardation, but not by much. The huge hump in the futures curve is the future contract that covers the election. We are paying close attention to this because it may either be time to buy some cheap front month volatility, or sell front month volatility if we think it’s going lower. Personally speaking, I’m not ready to sell volatility yet. As always, stay tuned.

April 24, 2020 - 4:48 pm

Insiders,

Another week in the books. It started out crazy with negative oil prices but ended up surprisingly quiet towards the end of the week. I sent out a new trade on BXP today, so hopefully you got a chance to get into the trade at some point today. I talk about the market and all of our open positions in this week’s video recap. The link is below. Enjoy the weekend!

Video Link:

https://content.jwplatform.com/videos/08sOxoRj-bK67iJnL.mp4

April 24, 2020 - 12:01 pm

Insiders,

I introduced a new trade last night during the live monthly session,, a put spread in Boston Properties (BXP). If you weren’t able to attend or haven’t yet executed the trade, it is still a viable trade (although a bit more expensive). We are looking for a move down in BXP due to a bearish thesis on Office REITs. The company also has earnings next week. See the trade details below. The most you can lose is what you pay (currently 1.35), while max gain is 3.65 at $ 80 or below.

Trade Details:

April 22, 2020 - 2:16 pm

Insiders,

Just a reminder that I’m presenting at the Wealth365 Summit later today, at 4 pm EST. It’s on volatility trading and should be interesting!

If you want to check it out, I’ve included the link below. Hope to see you there!

Investors Alley

April 21, 2020 - 5:56 pm

Insiders,

Going to hold off on further analysis of the oil market until tomorrow when May comes off the books officially, and the more realistically-priced June contract becomes the front-month. Instead, check out this chart of the top 5 largest stocks and how much weighting they have in the S&P 500. I saw another chart today that shows the top 5 S&P 500 stocks have the same weighting as the bottom 350! Basically, a lot of the positive movement we are seeing in the index are due to a very small number of companies. This is generally a pretty bearish sign. Also, it seems the most mega of the mega-companies have been considered safer than other large caps. Of note, Microsoft is the only one that appears on both lists (although Intel and Walmart are still in the top 20).

April 20, 2020 - 6:19 pm

Insiders,

I still haven’t received the text I sent out today about oil prices, as it seems like there’s a backlog in the texting system. Hopefully you will get that one, but more importantly, I hope you get this one with our trade for tomorrow. We are buying a call on Frontline (FRO), a tanker company, as the cost for oil storage is likely to soar with sellers literally having to pay buyers for storage. See the trade details below.

Trade Details:

April 20, 2020 - 4:00 pm

Insiders,

May crude oil is trading at negative prices for the first time ever, and the oil markets may forever change after today. A lot more about this in the OFT issue tomorrow, but I strongly recommend NOT buying USO or UCO (2x long). The oil storage issue is going to go on for much longer than this week if demand doesn’t shift dramatically. There’s a good chance June futures will also go negative as well. We’re going to buy a tanker company in OFT because we want to own oil storage, not oil itself. I’ll send out the trade details later today.

April 20, 2020 - 2:26 pm

Closing Alert:

GLUU has been on a really nice run, so I don’t see any reason to hold our trade through earnings. It seems like it could be a buy the rumor/sell the news type situation. If we close here, we should be able to get around $ 2.10 to close, which is a $ 1.40 gain, or 200% profits (in 11 days). I’ll take it! Closing details below.

Trade Details:

April 17, 2020 - 4:16 pm

Insiders,

A bit more mixed this week in stocks, but we ended on a positive note with the S&P 500 up nearly 3% today. The vibes were certainly more positive on Friday, but there is still plenty of negative economics and earnings news likely to come out in the next couple weeks. Be careful with your trading! There are both bullish and bearish opportunities out there – but just make sure you don’t put all your eggs in one basket.

I review the market and all of our Insider and OFT Pro positions in the Friday Video Recap, linked below.

Video Link:

https://content.jwplatform.com/videos/ENZWQO56-bK67iJnL.mp4

April 16, 2020 - 5:47 pm

Insiders,

Let’s look at something a little different today – open interest in SPY (the S&P 500 ETF). You can see below that call open interest and put open interest are both much higher than average. That’s not much of a surprise given all the action in the market. Looking at the put/call open interest ratio is a bit more interesting. The put to call metric is actually lower than average. That suggests there has been a lot of action in calls (probably buying by customers). It seems like traders could be betting on a rebound or were trying to take advantage of the recent retracement. This is something to keep an eye over the next few weeks.

April 15, 2020 - 6:01 pm

Insiders,

The economic news today was awful, possibly even worse than expected. Retails sales, industrial production, and homebuilder confidence metrics were all some of the worst on record. April could be even worse. And yet, the market has mostly been going up. Today we finally had a 2% selloff, which was not that big of a move considering how bad the economic news is. I still think we have more 2%-4% down moves ahead of us before we reach some sort of bottom. I think April or May is going to be another bottom in stocks and then maybe in the summer we can start climbing back. That’s just speculation on my part, but as you know, I don’t buy this latest rally. Volatility (as you can see below) is still high. The VIX price breaks down to expected moves of about 2.5% per day. I think the index and futures go higher in the next few weeks as earnings roll out.

April 14, 2020 - 6:31 pm

Insiders,

The S&P 500 was up 3% today, the VIX dropped to 37, and the market is being way too complacent right now. Of course, the last part is my opinion. However, bank earnings started coming out this week and JP Morgan Chase (JPM) is expecting unemployment to reach 20% this month. Look at the chart below of unemployment historical numbers and tell me why the market keeps regaining ground. (That’s a rhetorical question.) I think by the end of earnings season we’ll be much lower than we are now, but I’m not sure what it will take for investors to realize the extent of the economic damage occurring at this moment.

April 13, 2020 - 6:21 pm

Insiders,

These days, a 1% day (up or down) like we had today seems like an incredibly boring day. Volatility is staying firm for the most part though. I’ve attached a table showing some key implied volatility and historical volatility metrics for SPY, the S&P 500 ETF. We’re clearly well above average for both implied and historical volatility. However, 20-day historical is still near the highs (because it’s backwards looking). Nevertheless, I think IV may be dropping a bit too quickly and I expect a bump to it in the near future (especially if we have more than one down day in a row for stocks). That means I’d rather be a buyer than seller of SPY options (although I don’t have a specific trade in mind).

April 10, 2020 - 3:37 pm

Insiders,

Quite a bullish week for stocks, but it won’t surprise me if we reached the top of short-term range. Of course, a lot can happen over the coming 3-day weekend, so we’ll see what Monday brings. I talk about the market and our OFT Pro and Insiders positions in the weekly video recap below. I know we’re all pretty much stuck at home, but try to enjoy your 3-day weekend in whatever capacity you can!

Video Link:

https://content.jwplatform.com/videos/2XQcmHVt-bK67iJnL.mp4

April 9, 2020 - 2:02 pm

Insiders,

Let’s have some fun and do a little trading. I mentioned on last Saturday’s panel discussion with Tim and Eddy that I like video game companies with so many people stuck at home looking for ways to occupy time. A smaller video gaming stock like Glu Mobile (GLUU) particularly could benefit from this quarantine period we’re in. The company has earnings in early May, so let’s buy some May at-the-money calls (the 6 strike with the stock at $ 5.72) and see what happens.

Trade Details:

April 8, 2020 - 6:57 pm

Insiders,

Another big day for stocks, with major indexes up about 3.5%. Bulls are in charge for the time being, but I imagine we will be range-bound for awhile – so I’d expect a selloff at some point in the near future. VIX futures barely moved – another sign that traders aren’t fully buying into this rebound.

Shifting gears, here’s a look at the relative performance of major futures contacts over the last week. It’s small caps leading the recovery at the moment, which is a bit odd, although large caps aren’t too far behind. Also a nice 5% move in silver, which has been good for our SLV calls.

April 7, 2020 - 7:09 pm

Insiders,

Stocks finished flat today, which is interesting because they closed on the lows after being up over 3% in the morning. Is this a sign a reversal lower is coming? In a volatile environment like this, it’s hard to know what the next day will bring. You all know that my belief is we will have a second leg down as the reality of the economic damage done by the pandemic starts to be enumerated. In the meantime, we could have plenty of up days mixed in over the short-term. The VIX is still about 46, with realized volatility somewhere around 70%. In other words, there’s plenty of volatility still out there.

Instead of looking at charts today though, I wanted to share with you this new product coming out which I found quite amusing… a work-from-home ETF! This new ETF is supposed to invest in companies like video communications, cloud software, encryption, etc. Leave it to the investment industry to launch a product like this during a pandemic…

April 6, 2020 - 6:05 pm

Insiders,

It was a big day for stocks, but I spent my time looking for something to be bearish on for tomorrow’s OFT Pro issue. And, I think I found a great put trade for us in DRQ, an oil equipment company. We’re also rolling out UCTT to June. See both trades below.

Trade Details:

April 3, 2020 - 5:04 pm

Insiders,

Another volatile week in the books, although nowhere near as volatile as a couple weeks ago. There’s still a lot of intraday volatility (ups and downs) which won’t show up in the close to close data. It won’t surprise me if we have a big day on Monday – up or down – depending on how the news plays out over the weekend (updated COVID-19 numbers in particular). I talk about the market environment and our OFT Pro and Insider positions in the weekly video recap, linked below.

Video Link:

https://content.jwplatform.com/videos/vRF5LFCU-bK67iJnL.mp4

April 2, 2020 - 6:23 pm

Insiders,

The purest way to trade volatility is using something called a Variance Swap. Swaps (of any kind) are essentially only used by institutions, so you don’t need to learn about them (unless you are really really bored stuck in quarantine). However, I found the chart below interesting as it shows being directly short volatility into this crisis would have basically wiped out 20 years of gains using variance swaps. It doesn’t matter if you are an individual or hedge fund, you have to use proper risk management to survive as a trader. By the way, several hedge funds were wiped out because of their variance swap exposure.

April 2, 2020 - 2:19 pm

Insiders,

Our MMM call spread will expire out-of-the-money tomorrow, so let’s add a new MMM call spread to the portfolio. I was too early on the last spread, so this time around we are going all the way out to June to make sure we give the trade thesis enough time to play out. With the stock price currently around $ 135, we are buying the June 145-150 call spread for around $ 1.65. If the stock climbs above $ 150 by June expiration, the gains will pay for both of our call spreads plus we can make an extra $ 200 per spread.

This is a debit spread, so the most you can lose is the cost of the spread itself. The prices may fluctuate somewhat due to how wide the bid/ask spreads are and with the overall market volatility being so high. In other words, be sure to use a limit order to place the trade!

Trade Details:

April 1, 2020 - 6:05 pm

Insiders,

The major stock indexes were down close to 4.5% today, which isn’t a huge surprise with quarter-end positioning now completed. Looking at the options market, total options volume was around 21.5 million contracts, a bit under the average of 22.8 million. As you can see from the pie chart, the biggest portion of activity (nearly 35%) was in broad-based ETFs (like SPY and IWM). I expect broad-based ETFs to trade more during volatile periods as investors tend to do more market-wide hedges or speculative trades. The next biggest trading areas were in Tech and Services.

March 31, 2020 - 5:44 pm

Insiders,

This is the first less than 2% day we’ve had in awhile (in regard to stock indexes). Even though it was a down move, volatility dropped just because the there was far less action that what we’ve gotten used to the last couple weeks. Well, I should clarify, front month volatility dropped a little, but the middle part of the curve didn’t really move, as you can see below. (Grey is the previous day, blue it where we ended up today in VIX futures.) The quarter just ended, which usually coincides with funds allocating money to stocks. It won’t surprise me to see stocks sell off more sharply now that quarter-end buying is (likely) done.

March 30, 2020 - 6:01 pm

Insiders,

Another up day for stocks, with the major indexes up over 3%. I don’t think this rally will hold. I’ll talk all about my reasoning at tonight’s Insiders Live Session at 8pm EST (or tune in to the replay, which will be sent out tomorrow). Hope to see many of you there tonight!

March 27, 2020 - 5:27 pm

Insiders,

Another crazy week in the books and you can expect plenty more volatility next week now that the stimulus is past (which probably means a sell the news type situation, but we shall see).

First off, our Insider live monthly session will take place next Monday at 8pm EST. You’ll get an email or two as a reminder, but just in case, here’s the link:

https://zoom.us/j/829598320

And of course, we have our weekly video recap that I just posted. Here’s that link:

https://content.jwplatform.com/videos/5u50maYt-bK67iJnL.mp4

Enjoy the weekend and please stay safe!

March 26, 2020 - 5:00 pm

Insiders,

The S&P 500 was up 6% on a day when new jobless claims reached 3.3 million. It’s hard to make sense of those competing statistics. It’s possible that the very poor claims numbers pretty much ensures that the $ 2 trillion stimulus package will pass the house. Still, it’s hard to believe that this rally will hold up given just how weak the economy looks right now. I’ve also heard that this up move is due to traders front-running the pension fund rebalancing that takes place at the end of each month. In other words, pension funds have to buy stocks at the end of the month and some traders are trying to get in front of that to make extra money. Despite both the stimulus package and pension fund activity, I think we go back to selling off in the near future. Volatility is still very high, which means we can expect big swings pretty much every day. As always, stay safe out there.

March 25, 2020 - 5:52 pm

Insiders,

The S&P 500 was up a little over 1% today. but that doesn’t do justice to the intraday volatility in the markets. That’s one reason why the VIX was up to around 64 today despite it being an “up” day for stocks. To get an idea of just how concerned investors have become, take a look at this table showing the last 30-days of crash-level puts in SPY (20% from the at-the-money). It’s pretty crazy to see how much activity and spending have risen in the last month!

March 24, 2020 - 4:55 pm

Insiders,

The S&P 500 was up over 9% today with the stimulus package in Congress seemingly near completion. That’s certainly good news for the US, where jobless claims are spiking and working hours have been reduced substantially. However, don’t buy into the belief that this rally as the end of the stock selloff. The infection rate in the US probably won’t peak until mid-May at the earliest – and it could be a lot worse if we try to go back to a normal working environment too soon. Looking at the VIX term-structure below, you can see the curve is still plenty elevated (compared to just about any other historical period) and the futures are still in steep backwardation. I’ll say it again, I’m not a broad-based buyer of stocks until that blue line flattens out.

March 23, 2020 - 6:17 pm

Insiders,

Here are the trade details for the new trade coming out in tomorrow’s OFT Pro issue. For those of you familiar with any of Tim Plaehn’s services, this is one of his favorite high yield stocks. I don’t normally trade options on REITs, but this one was too good to pass up!

Trade Details:

March 23, 2020 - 1:49 pm

Insiders,

Volatility is down today but we’re far from out of the woods on COVID-19. Peak infection rate in the US is probably somewhere in May at the earliest, despite the slowing of the spread you may see in other countries. I think we have more extreme volatility to come. However, to keep our risk/cost a bit lower, we’re going to look at medium-term volatility rather than short-term. We’ll use a May call spread in iPath S&P 500 VIX Mid-Term Futures ETN (VXZ) instead of a short-term volatility product (like VXX or UVXY). Medium-term futures shouldn’t be as volatile as their short-term counterparts. Although we are using a call spread to reduce the cost, calls on anything volatility related are definitely pricey right now. The other thing to be aware of is that bid/ask spreads are quite wide at the moment. You may have to leave your limit orders in the market for a while to get filled, and possibly adjust the prices a few time. Just make sure you use limit orders no matter what!

Trade Details:

March 20, 2020 - 5:17 pm

Insiders,

It felt like after Wednesday and Thursday that we may get something of a reprieve from the selloff in stocks. However, Friday was yet another down day. It was “only” 4% this time, which seems tame compared to 9-10% days were had early in the week. We’ll see what the weekend brings, although I imagine it will be good for traders to step away from these crazy markets for a couple days. Please stay safe this weekend and definitely check out my weekly video linked below for some additional perspective on the markets.

Video Link:

https://content.jwplatform.com/videos/0bRDFNwR-bK67iJnL.mp4

March 18, 2020 - 5:00 pm

Insiders,

Today was probably the first day where it really felt like people were panicking. I don’t know if that means we’re at or close to a bottom, but usually when all the news turns negative, that’s when things start to turn around. Still, many stocks will probably remain depressed for quite some time given the nature of COVID-19 and how much damage it could do to corporate earnings.

Looking at our VIX term-structure, you can see how the close/last (blue line) was still much closer to the high of the day (purple) than the low (red). The most shocking thing to me though is the 10-day realized volatility at 117%. After this current crash is over, we may never see that type of realized volatility ever again. As always, stay safe.

March 17, 2020 - 5:29 pm

Insiders,

The market insanity continues… and it may well remain crazy for the foreseeable future. Let’s go to our trusty VIX term structure to get a clearer view. First off, I want to call your attention to the yellow dotted line near the top. That’s 10-day realized volatility for the S&P 500. I’ve never seen it that high. I not sure I even believed it could be that high. You can see the VIX index level below it in green. The VIX is roughly equivalent to saying the market implied volatility is 76%. By that measure, you could easily argue that VIX is too low right here, not too high (76% IV versus 109% RV). (That’s also why I’m not a fan of shorting volatility here.) Finally, although the market was up today, there’s clearly still plenty of concern. You can see from the 3 different colored curves below that VIX futures closed near the high of the day.

March 16, 2020 - 4:40 pm

Insiders,

Wasn’t sure I’d ever see this again in my lifetime, but here it is – the VIX curve is now higher than October 16th, 2008 (the Lehman day). This is basically as high as volatility has even been in decades. It may have theoretically been higher during the 1987 crash, but we weren’t trading/tracking volatility back then. (It also may have been higher in the tulip crash of 1637.)

We’re making history right now, but the important thing is to stay safe. Don’t put too much money in play just yet. We may be close to a short-term bottom here, but it’s never a good idea to try to time the market. There will be time to buy when things settle down. Also, please follow the CDC guidelines and practice social distancing. I don’t want any you getting sick on my watch.

March 16, 2020 - 1:20 pm

Insiders,

It’s a tough environment to trade in, but here’s a trade we aren’t going to pass up. Silver futures are at their lowest level since 2009, and it’s all about liquidation. The extreme market selloff has caused even defensive positions to be liquidated. However, with the Fed cutting rates to 0%, metals should be popular trades right now. Once the dust settles, I believe money will start flowing into precious metals. Meanwhile, iShares Silver Trust (SLV) is dirt cheap. We’re going to buy some May calls to give it time to recover. I know we still have a position in SLV that expires next week, but you can ignore that and let it expire worthless if you have that position on. See trade details below.

Trade Details:

March 13, 2020 - 5:49 pm

Insiders,

I got back early from my trip, so I figured I’d get the weekly video out today instead of over the weekend. What a crazy week! I talk about the past week and our open positions in the video linked below. Everyone have a safe weekend.

Link:

https://content.jwplatform.com/videos/IeZrIQlr-bK67iJnL.mp4

March 11, 2020 - 12:30 pm

Insiders,

It’s Spring Break here so I’m going up to a cabin in Northern Arizona with my family for a couple days starting later today. I will have limited email access. I’m bringing my computer because the markets are crazy, but I’ll probably only check it once a day so responses will be delayed. The normal Friday Weekly Video will be done over the weekend when I return. I’ll send out a text when it’s completed, but the email probably won’t come out until Monday. There won’t be any additional trades this week (which I think is for the best given the volatility). Be careful out there, market volatility is still at extreme levels.

March 10, 2020 - 6:51 pm

Insiders,

Is today a sign that the bottom is in? Of course, that’s impossible to know for now, but we can still assess if there’s going to be more selling ahead. My opinion is the same as it has been in recent days, we’re far from out of the woods. Based on the VIX term structure below, I think you can count on more down days ahead. We may not establish a new low, but we’re certainly not going straight back up from here. Government assistance to individuals/companies may stem the bleeding for the time being, but it won’t cure COVID-19. I still think it gets worse before it gets better, but the market is very forward looking. so we won’t know until we know. In the meantime, I recommend staying away from wholesale buying – at least until the VIX term structure is out of backwardation.

March 10, 2020 - 12:59 pm

Insiders,

Volatility is down a little today and it is allowing us to cash in on our XLY put spread for close to max gain. You should be able to close it here from around $ 2.70 (max gain in $ 3). Since we paid $ 1 for the trade, it works out to 170% gain in just 6 days. I don’t think it’s worth waiting any longer just to collect an extra 30 cents. Let’s close it here and take profits. See closing trade details below:

Trade Details:

March 9, 2020 - 6:46 pm

Insiders,

A 7% down in the stock indices is essentially the worst selloff we’ve seen since the Great Financial Crisis of 2008. The VIX around 55 is also as high as we’ve been since the subprime meltdown, nearly 12 years ago. The pain may continue, although there may be some buying that occurs in bunches in the coming days. Be careful at putting your money at work while the VIX is this high. In the meantime, we are doing some targeted longer-term buying in the OFT Pro. See the trade below for Hawaiian Holdings (HA). We are also doing a new trade in Avaya (AVYA) since the current trade is nearing expiration, and we are taking profits on Fastenal (FAST), which is currently a 233% winner.

Trade Details:

March 9, 2020 - 3:35 pm

Insiders,

I’ll have more later, including a preview of our trade tomorrow in OFT Pro, but just a quick heads up about market halts. We’re late enough in the trading day that the market essentially won’t be halted if we hit the next stop (-13%). I don’t think we’ll test that level, but don’t be surprised to see a lot of action on the close one way or the other. Nothing wrong with sitting in cash today. Be safe out there.

March 6, 2020 - 4:30 pm

Insiders,

Another crazy week! While the market may have rallied on the close, volatility is still through the roof.

I talk about volatility and our open positions in the Weekly Video.

Here’s the link:

https://content.jwplatform.com/videos/l6fjWpOK-bK67iJnL.mp4

March 5, 2020 - 5:51 pm

Insiders,

I warned yesterday that there would be more selling to come and we positioned for this by putting on the XLY trade. Hopefully many of you were able to get into that trade. Meanwhile, the VIX is back up to 40 and there’s no reprieve in sight. It’s important to stay defensive right now. If your are looking to do a little bottom-fishing, then stick to longer term trades. Nothing wrong with scooping up airlines or cruise lines now (and others, those are just an example), but just realize they will probably go lower before they go higher. (I don’t recommend trying to time the bottom, grab the cheap stocks now if you want, just know there is more volatility ahead.)

One way to look at volatility (risk) in the market is to look at how much index puts costs. The higher the premium, the more demand there is for put protection. The table below shows today’s SPY put premium for different levels of at-the-money and out-of-the-money puts. The bottom two puts represent crash-level puts. We aren’t at 52-week highs (those happened last week during the initial panic), but we certainly aren’t far off. The percentages indicate the premium of the put in terms of its percentage to the price of SPY (so an ATM put would cost around $ 12 for example… SPY at $ 300 x 4% = 12).

March 4, 2020 - 4:40 pm

Insiders,

Notice that the trade we did today was still bearish (put spread on XLY). A healthy market doesn’t go back and forth from -3% down days to +4% up days. This is not the type of market where you want to short volatility. You can see below that the VIX term structure is still in strong backwardation. In fact, backwardation (front month minus second month) merely moved from -11% to -10% despite a 4% spike in stocks. Don’t be fooled. This is not the sign that we’re done selling off. If you are buying low, be cautious, and by all means, don’t sell volatility outright!

March 4, 2020 - 3:06 pm

Insiders,

The market is finally at a point where I feel comfortable making a trade. Despite the good news today, I think there is likely to be more selling and more volatility ahead. I believe consumer spending is going to be focused on staples (like toilet paper!) and discretionary spending is likely to take a hit. Let’s use this up day as an entry point into a short-term put spread on the consumer discretionary sector. We’ll use XLY, which is the sector ETF for consumer discretionary stocks. This put spread should only cost about $ 1.00 and will cover a little over the next two weeks. See trade details below:

Trade Details:

March 3, 2020 - 6:29 pm

Insiders,

I mentioned yesterday that I didn’t believe in the rally, and sure enough today, we’re back down. The Fed even cut rates by 50 basis points in a surprise move. That didn’t comfort the market as traders took it as a sign that there is more economic pain ahead. The Fed is also running out of wiggle room to lower rates. Meanwhile, the VIX is well over 30 and the term structure is in backwardation (front month more expensive than following months) as you can see below. This means owning something like VXX and UVXY has a tailwind. Options on those products are expensive, but very could pay out if the market continues to selloff

February 28, 2020 - 5:21 pm

Insiders,

What a crazy week! The markets tanked and who knows what the weekend will bring. Will it be fiscal or monetary stimulus? More bad news? Whatever happens, Monday is sure to be intense. I talk about all this and more in our Friday weekly video, linked below. Email me if you have any questions or comments.

Video Link:

https://content.jwplatform.com/videos/vahlVROY-bK67iJnL.mp4

February 27, 2020 - 3:46 pm

Insiders,

We have a lot to talk about tonight, so please try to tune in to our live session. We will take a very close look at this crazy market.

Hope to see you all there!

February 26, 2020 - 2:52 pm

Insiders,

I’m not sure the pain is over yet, but I want to start taking some profits on positions that are doing well. We bought the Walmart (WMT) put spread last week for $ 0.72. We can sell it right now for $ 2.00. That’s a 178% return in about 8 days. Let’s take those profits off the table. We are still long SLV here and our next trade may be looking to scoop up something oversold.

See trade details below on how to close the WMT put spread.

Trade Details:

February 25, 2020 - 4:13 pm

Insiders,

Okay, this is serious. In case yesterday didn’t scare you enough, the S&P 500 is now down close to 7% in just two days. Even precious metals are down today, which means investors are likely having to sell off their winners to cover margin calls. That’s obviously not a good thing. With precious metals taking a breather, our SLV position has dropped down to around even – but our WMT position is doing very well today, up 156% on the trade last I checked Meanwhile, the VIX (volatility) is through the roof. Backwardation, as you can see, is very pronounced (meaning front month VIX futures are higher priced than all the other months behind it). The VIX index is much higher than the futures curve, which tends to happen only in the most extreme circumstances.

Be careful out there. There may be some buying opportunities this week, but don’t rush into anything. It’s more important to protect your portfolio than look for gains.

February 24, 2020 - 4:46 pm

Insiders,

The markets finally became concerned about COVID-19 after we’ve been talking about its impact for the last several weeks . The major stock indexes were all down over 3% today and the VIX shot all the way up to 25, which is a legit sign of danger. We’ll analyze volatility in more depth tomorrow after we see how the markets react. For now, we’re going to do a little bottom fishing in Options Floor Trader Pro, purchasing calls in Ultra Clean Holding (UCTT). See the trade details below. The full issue will come out tomorrow.

Trade Details:

February 21, 2020 - 4:45 pm

Insiders,

Weekly video is now available at the link below:

https://content.jwplatform.com/videos/mNbPoYAX-bK67iJnL.mp4

February 21, 2020 - 1:13 pm

Insiders,

Let’s trade some SLV calls. We have our straddle expiring today and the calls are profitable. We are going to take some money off the table and use some of the proceeds to buy another call expiring at the end of March. For those of you not in this trade, you can just do the second part of the trade below, which is buying the SLV March 27th 17.5 calls for around $ 0.38. For current SLV straddle holders, we will let the puts expire worthless and roll the calls using a roll trade (diagonal) like you see below. We are getting around a $ 0.40 credit which is the cash that goes back into our account. The rest of the proceeds will go towards rolling the call. Shoot me an email if you have any questions on the trade.

Trade Details:

February 20, 2020 - 2:01 pm

Insiders,

We have the SLV straddle expiring tomorrow and it’s a very small winner at the moment. I’m pretty bullish on precious metals here, so my plan is to wait until tomorrow and roll out the call portion of the trade (unless we get a big spike and it’s worth taking profits). Stay tuned.

February 20, 2020 - 12:46 pm

Insiders,

I got excited about ETFC and almost forgot to send out this alert. Here’s the closing trade:

February 19, 2020 - 4:21 pm

Insiders,

Want to hear me talk about volatility, the Fed, and Apple? Check out the link below to the latest episode of the PureXposure Growth Series, hosted by Bob Iaccino. I’m a guest for the first 30-35 minutes or so. I even make an Apple trade recommendation that has turned out really well so far.

Here’s the link:

https://www.youtube.com/watch?v=-bX4DTuNBhw

February 18, 2020 - 12:30 pm

Insiders,

Okay, let’s trade! Walmart (WMT) posted worse than expected earnings today (before market open). The company’s toy and games sales fell well below expectations as they continue to lose ground to Amazon. For some reason the stock is actually up a little today (because that’s all stocks seem to do these days). However, I think the higher move is short lived.

We’re going to buy a put spread in March that makes money if WMT sells off. We are using the put spread to keep the cost of the trade reasonable. See trade details below. At the cost of $ 0.72, that’s all we can lose on the trade, but we can make $ 4.28 if the stock drops below $ 110 by expiration on March 20th.

Trade Details:

February 17, 2020 - 1:35 pm

Insiders,

See me live tomorrow discuss options and black swans! It’s free to access. See details below.

February 14, 2020 - 4:30 pm

Insiders,

Weekly Video is now up. Have a great 3-day weekend!

Video Link:

https://content.jwplatform.com/videos/MbHxbw9I-bK67iJnL.mp4

February 13, 2020 - 5:25 pm

Insiders,

The VIX remains a bit elevated, but not enough in my opinion, based on the economic risk posed by the coronavirus. The curve has moved into nearly a 5% contango, but part of that is due to expiration next week in VIX futures. The VIX front month future has to converge to the VIX spot price at expiration. Still, there’s a very good chance we could see both the spot price and the futures curve higher next week if bad news regarding coronavirus continues to make headlines.

February 11, 2020 - 2:55 pm

Insiders,

Today marks the 1-year anniversary of the very first Options Floor Trader Pro issue! To celebrate this momentous occasion, we are going to close a big winner from our portfolio. DISH is up 7% today and the position is around a 109% winner, so let’s take our gains!

Here’s the trade:

February 10, 2020 - 7:06 pm

Insiders,

After holding Sprint (S) for months in OFT Pro and finally giving up on it a couple weeks ago, the TMUS/S merger is apparently going to be allowed to happen based on the results of a key ruling this evening. The stock is up 64% after hours to almost $ 8 and I’m having trouble not beating my skull against the desk. On the bright side, it’s good news for DISH which is up to $ 38 after hours. We should be able to close it for a profit tomorrow. The market always finds a way to keep you humble.

February 10, 2020 - 5:30 pm

Insiders,

Below I have the new trade for tomorrow in OFT Pro – which I think is a pretty intriguing trade (ZTO). There’s also a new ETFC trade since our current one expires this week.

February 7, 2020 - 4:41 pm

Insiders,

It’s been an interesting week so be sure to watch the weekly video update.

Here’s the link:

https://content.jwplatform.com/videos/i7c8iFdC-bK67iJnL.mp4

February 6, 2020 - 4:39 pm

Insiders,

For your viewing pleasure and amusement, here’s a chart comparing the implied volatility in Tesla to the SPY. Tesla is green, SPY is orange. Now we expect TSLA to be more volatile than an index, especially around earnings periods. However, this last week has been insane. I’m sure the day traders had a blast.

February 5, 2020 - 4:13 pm

Insiders,

Update: Remember those 1,500 strike calls in Tesla I mentioned yesterday? On Tuesday, with the stock at $ 900 the 1500 calls expiring on Friday were trading for a bit over $ 3. Today the stock is at $ 725 and those same calls are worth about 15 cents (which is still too expensive).

February 5, 2020 - 12:06 pm

Insiders,

Options Floor Trader Pro: Rolling Alert

Applied Materials (AMAT) was looking like a sure thing winner after we made the trade, but the coronavirus scare sent the entire market lower and took AMAT with it. The stock has recovered quite a bit, but now we are up against expiration this Friday. As such, we are going to roll out this trade for another couple weeks. We are moving from the 63 strike to the 64 strike in order to cut down on roll costs.

Sell to close the AMAT February 7^th 63 call

Buy to open the AMAT February 21^st 64 call

Total cost should be around $ 0.85.

See entry details below.

Trade Details:

February 4, 2020 - 5:11 pm

Insiders,

You probably saw the craziness that was Tesla stock today. The cult stock is seeing a massive short squeeze as the horde of short stock holders get run over (which causes the stock to soar higher when they are forced to cover their positions). One of many insane stats from TSLA options – with the stock price at $ 890, over 54,000 1,500-strike call options traded today (over all expirations) which amounted to over $ 110 million in notional activity. Even the 1,500 call which expires on Friday (the 3-day call) is trading for around $ 3!! I’m not suggesting you trade that call, but at about 250% implied volatility, it’s mind-blowing. Fun stuff!

February 3, 2020 - 3:52 pm

Insiders,

The S&P 500 is up 1% but I don’t buy this move at all. Look at the VIX term structure… major backwardation (front month higher than second month). As I’ve mentioned before, it is a sign that traders/hedgers are very concerned about the present (more so than the future). Until the curve goes back to a more normal shape (upward sloping) we need to assume a market selloff is very possible.

February 3, 2020 - 3:11 pm

Insiders,

I’ll post something more substantive later on, but for now:

January 31, 2020 - 5:14 pm

Insiders,

I’ll leave you with this picture of today’s VIX curve. This is what backwardation in a term structure looks like. It also means the market is clearly in “concerned” mode. Stay tuned.

January 31, 2020 - 4:31 pm

Insiders,

Weekly Video is now up.

Here’s the link:

https://content.jwplatform.com/videos/FtoNS5Kz-bK67iJnL.mp4

January 29, 2020 - 5:41 pm

Insiders,

We’re going to look at the VIX term structure again because I think it’s important to see how the futures react under different market conditions. You can see (if you look closely) that the curve barely moved from yesterday. The back months just dropped a very small amount. Since the “natural” behavior for volatility is to mean revert to lower levels, a lack of movement is generally a sign that volatility buyers have more sway than sellers. I’ve pointed out how the huge hump in October is due to the election, but you’ll notice the smaller bump in April futures. That’s due to Super Tuesday which is important as it should solidify who the Democratic candidate is going to be. It will be interesting to watch how the curve reacts as we get closer to key political events this year.

January 28, 2020 - 6:25 pm

Insiders,

Let’s take a look at the VIX term-structure. Below you can see the previous close, which is the day of the sharp selloff, and today’s price, where we had a moderate recovery. Most of the actively traded futures months shifted down today although the curve is definitely on the flat side of things (and yesterday it was in backwardation!). That means that the market is concerned about uncertainty right now regarding the coronavirus (and to some extent, the upcoming election) and we need to tread carefully. I’m not sure I want to buy volatility here, but I sure don’t want to sell it until the curve shifts to much steeper contango (front month cheaper than second month).

January 27, 2020 - 4:23 pm

Insiders,

Stocks sold off sharply today and the VIX futures curve has gone from contango to backwardation on fears of the coronavirus spreading and potentially causing widespread disruptions in the global economy. We’ll look at the VIX term structure in more depth tomorrow, but for now I want to show you the trade I have planned for the OFT Pro issue tomorrow. The trade, a put on Fastenal (FAST), is due to the struggling company possibly seeing further issues with a supply chain disruption since they source many of their supplies from Asia.

Here’s the trade:

January 24, 2020 - 4:44 pm

Insiders,

Weekly video is up! Here’s the link:

https://content.jwplatform.com/videos/dqaE9sNN-bK67iJnL.mp4

January 23, 2020 - 10:11 pm

Insiders,

I’ve been swamped today preparing for the Wealth365 presentation I did earlier tonight, so when no one showed up for our live session at the normal time of 8pm EST, I assumed it was just options fatigue (after listening to Wealth365 webinar which was directly prior). I recorded the webinar like normal, although I went through everything pretty quickly. However, I just saw the email that went out to Insiders that says the presentation starts at 11 pm EST. No wonder no one was there at 8 pm!

Anyhow, I don’t think most of you will be awake at that hour and besides I don’t think you’ll be able to get in since I already recorded the presentation. I’m not sure how this time mix up happened (probably a typo when it got entered into the system) and I apologize for the confusion. I’ll send out the recorded webinar tomorrow and then feel free to email me with any questions you may have been saving for the session tonight. Sorry again for the confusion!

January 23, 2020 - 12:40 pm

Insiders,

Let’s place a new trade for our Insiders portfolio. I liked how the USO straddle looked even though we didn’t make much profit off of it. Buying cheap straddles seems like a good idea here with the market starting to show a little bit of concern. Precious metals have seen a lot of action lately and we can do a straddle in silver for cheap. We’ll use iShares Silver Shares (SLV) as it’s the easiest way to trade silver and the stock is only trading for $ 16.64 which makes the at-the-money straddle very affordable. The February 21st 16.5 straddle (call and put) only costs around $ 0.62 with expiration in a month. See the trade details below and feel free to email me with any questions.

.;l

January 22, 2020 - 4:48 pm

Insiders,

Some very interesting data from the Cboe – more than 60% of exchange traded options have 30 days or less to expiration, and 40% are within 10 days or less. In other words short-term options have come to dominate the market. As you can see in the chart, it wasn’t always this way. It will be interesting to see if this trend continues and what impact it may have on the market moving forward.

January 21, 2020 - 6:53 pm

Insiders,

The current front month VIX futures contract is about to expire. As you can see in the chart, that means contango is going to go from a very high level (17.6%) to a much more moderate one (3%). This may be a sign that volatility traders are going to start paying more attention to market risk. However, we’ll need to see how this contango level changes in the next week or so. Remember, when contango steepens (the front month drops below the second month), it’s generally a sign of complacency.

January 17, 2020 - 4:49 pm

Insiders,

Weekly video is now up. Here’s the link:

https://content.jwplatform.com/videos/lcyBFZ8F-bK67iJnL.mp4

January 17, 2020 - 2:41 pm

Insiders,

The Wealth365 Summit is coming up next week and I’m doing a presentation on Thursday, January 23rd at 7 PM EST. It’s going to be on using volatility metrics to find profitable options trades. If you’re interested in checking it out, you can register here:

Investors Alley

January 15, 2020 - 4:12 pm

Insiders,

Trying something new today. Check out the video linked below where I show off a new toy that I just got.

Link:

https://content.jwplatform.com/videos/jwzxNBQO-Bvib7p4n.mp4

January 14, 2020 - 6:20 pm

Insiders,

We haven’t looked at the sector volatility table for a while. Consumer staples and utilities are at 52-week lows in terms of volatility but most of the other sectors are well off the lows. In particular technology has actually increased into moderate territory. This could be due to upcoming earnings season but it’s also something to keep an eye on since it’s generally tech stocks leading stocks to all-time highs these days.

January 13, 2020 - 4:47 pm

Insiders,

You get first crack at the new OFT Pro trade tomorrow, so here are the trade details:

January 10, 2020 - 3:18 pm

Insiders,

Weekly Video is up!

Link:

https://content.jwplatform.com/videos/rn47RoO2-bK67iJnL.mp4

January 9, 2020 - 3:26 pm

Insiders,

Our USO straddle has been an interesting trade since the price of oil has been volatile. At first it looked like USO was going a lot higher, and now it’s actually profitable on the put (down) side. Right now, we can sell out the put for more than we paid for the entire straddle and still own the call (for nothing) – so let’s do that. If we sell the put for around $ 0.57, we are actually around 10% on the trade in general and we still own the call in case oil starts moving higher over the next 8 days (prior to expiration). Keep in mind, any price we sell the call for is all winnings (minus commissions, but those are small these days).

Trade details:

January 8, 2020 - 4:20 pm

Insiders,

What a crazy turnaround! I sent out a couple messages relating to the big drop in the S&P 500 in after hours trading with the caveat that there was a long way to go before opening today. And of course today the market actually traded higher. Right now, the path of least resistance is long stocks, short volatility. Going against that is going to be a challenge under the current market regime, which is why I intend to go with the flow. You can see in the chart below, VIX actually dropped today across the curve from open to close.

January 7, 2020 - 7:57 pm

Insiders,

Update: S&P 500 futures now down 50 points, or 1.6% after the Iran missile attack. A long way to go to tomorrow’s market open though.

January 7, 2020 - 6:44 pm

Insiders,

I was about to talk about how volatility was basically unchanged from yesterday, but apparently Iran has just launched some missiles at a US base in Iraq. S&P 500 futures are tanking on the news, as you can see below. Now, 22 points isn’t crazy, but it will definitely be a higher volatility day tomorrow if this situation holds. We’ll know soon enough.

January 6, 2020 - 6:27 pm

Insiders,

With the escalation in the Middle East and the potential conflict with Iran, I would expect to see more portfolio hedging activity in the market. Let’s look at order sentiment in SPY and see if that is what the data show:

Based on this order sentiment tool at marketchameleon.com, it does seem like there is more bearish activity today compared to the prior 5 days. The numbers show roughly 60% bearish activity, which is still far from seemingly real concern (where I’d expect that number to be over 70% at least – but there are a lot of competing factors when it comes to index trades). It will be interesting to see how this ratio changes as the situation plays out.

January 3, 2020 - 5:25 pm

Insiders,

Weekly Video is up! Link below:

https://content.jwplatform.com/videos/6PujmSL0-bK67iJnL.mp4

January 2, 2020 - 5:27 pm

Insiders,

We generally look at volatility levels to see what investors think about current market conditions. Another way to similar measure investor sentiment is to look at the cost of put protection, i.e. the cost of hedging. As you can see in the table below, hedging costs are near their 52-week lows for major US and global indexes. If puts are reasonably cheap – like they are now – it means investors aren’t very concerned about the financial markets under current conditions.

December 31, 2019 - 6:11 pm

Insiders,

It’s the last day of the year, so let’s take one more like at a list of major assets (indexes, commodities, bonds, currencies) and see how they performed for 2019. The list is actually futures performance for all these assets, but it’s essentially the only metric we can use to compare all the assets on equal footing. Who had palladium in the office pool? As you can see, lots of green on this chart. In the red category, I don’t really count the VIX since it oscillates regularly and percentage moves don’t really apply to it. It was another tough year for natural gas, but a very good year for crude oil. Clearly, it was a good year for stocks, especially tech stocks. Happy New Year!

December 30, 2019 - 5:27 pm

Insiders,

Don’t forget there’s an Options Insiders live webinar tonight at 8 pm EST. Also, there’s a couple action items in tomorrow’s OFT Pro issue, seen below.

The new trade is in Applied Materials (AMAT). We are buying the February 7th 63 call for around $ 1.30.
We are closing Newmont Mining (NEM) January 17th 43 call for around $ 1.29.

Hope to see everyone tonight!

December 27, 2019 - 4:52 pm

Insiders,

Weekly video is up!

Here’s the link:

https://content.jwplatform.com/videos/X8B2dOMD-bK67iJnL.mp4

December 27, 2019 - 12:15 pm

Insiders,

Not a lot of action in the markets on a holiday week, but let’s add a trade to our Insiders portfolio since we don’t currently have anything on. Our trade today is a straddle trade, which is buying the call and put at the same strike in the same expiration. It means we think the underlying asset is going to move, but we’re not sure which direction. Essentially, we are betting on volatility.

In this case, we are using United States Oil Fund (USO) for our straddle. Oil has been a tear lately, but there seems to be an equal amount of analysts who think price is ready to mean revert as there are who believe the rally is going to continue. By purchasing the January 17th straddle, we can don’t care what happens as long oil prices move enough in either direction over the next 3 weeks. Moreover, with USO trading around 13, the straddle only costs about $ 0.53. As long we get over a 53-cent move in either direction, we will turn a profit.

Trade Details:

December 26, 2019 - 5:55 pm

Insiders,

Hope everyone is having an enjoyable holiday week! In honor of the Nasdaq Composite Index finishing at its highest level ever, let’s take a look at QQQ (Nasdaq 100 tracking ETF) puts versus calls (skew). A low skew means traders are either buying calls or selling puts or both, which is bullish. As you can see, QQQ skew remains at very bullish levels. While it’s not at the lowest levels of the year, the tech heavy ETF is still well below the average skew levels for the last year and month.

December 24, 2019 - 3:02 pm

Insiders,

They say a picture speaks a 1,000 words. In this case of the chart below, I think this picture shows you everything you need to know about the current state of volatility. (What it shows is that every sector of the ETF has current implied volatility levels at or near 52-week lows. That means there’s very little concern in the market right.)

December 23, 2019 - 4:57 pm

Insiders,

It will likely be a very slow week for the remainder of the week. Tomorrow is a half day for the major exchanges and Wednesday is of course a holiday. I plan on releasing an Insiders trade later this week, probably on Friday. I haven’t decided on what we’re doing yet, but some kind of bullish directional spread is a safe bet. We will still have our weekly video on Friday and I will send out text alerts regularly this week except for on Wednesday, when I imagine most of you will have other things going on!

December 20, 2019 - 4:56 pm

Insiders,

Weekly video is up.

Here’s the link:

https://content.jwplatform.com/videos/GrEFZiE2-bK67iJnL.mp4

December 19, 2019 - 5:38 pm

Insiders,

Here’s another chart showing volatility conditions in SPY, the world’s most popular ETF. The green line is implied volatility (30-day) and the purple is historical or realized volatility (20-day moving average). You can see that implied volatility has dropped and is at lows of year, with historical volatility also at very low levels (but off the lows of the year). Implied and realized volatility have converged meaning there’s very little risk premium to be gained from selling SPY volatility right now.

December 18, 2019 - 5:30 pm

Insiders,

Here’s an interesting chart from Marketchameleon.com showing the risk protection premium on SPY. It’s the cost you’d pay for a 30-day put on SPY, which is often used as insurance against a market selloff. The higher the premium, the more investors are paying for protection, and the more they are worried about a selloff. You can see from the chart that put premiums are at their lowest levels of the year, and well below the 52-week average. It certainly seems like investors aren’t concerned about a selloff anytime soon.

December 16, 2019 - 5:57 pm

Insiders,

Here’s the Options Floor Trader Pro trade that is coming out in tomorrow’s issue:

December 16, 2019 - 11:39 am

Insiders,

VXX has continued to melt down as expected, so let’s go ahead and take our profits here on our December 17 puts. We bought them for $ 0.81 and we can sell them for right around $ 2.17. That works out to 168% gains in just 12 days, which is definitely the kind of result that we like to see. Trade details below.

December 13, 2019 - 3:47 pm

Insiders,

Weekly Video is now up.

Link:

https://content.jwplatform.com/videos/73Txs9oD-bK67iJnL.mp4

December 12, 2019 - 4:05 pm

Insiders,

Regarding our two open trades: the SLB put spread expires tomorrow and it will end up worthless. I considered rolling it out, but the fundamentals in the oil market have shifted and the bearish case for SLB is no longer nearly as strong. In fact, there isn’t much of anything I’d do that’s bearish right now given the market activity and the news cycle. As such, after SLB expires, we’ll place a new call spread on something bullish in nature instead.

On the other hand, our VXX put is doing quite well and should be doing even better next week if the trade deal is in fact agreed upon. Volatility should collapse even further at that point and we will be able to cash out the trade for a nice profit.

In summary, do nothing on SLB, and next week we’ll add a new bullish trade and close VXX.

December 11, 2019 - 4:29 pm

Insiders,

The Fed did nothing to rates as expected after today’s FOMC meeting. At the moment, there are neither rate hikes nor rate cuts expected next year, which is very bullish for stocks. I think we’ll see volatility take a dive over the next couple days barring any jarring trade war news. You can see how volatility started collapsing by the end of the day in the table below. It could be even more pronounced by Friday. That’s also a very good sign for our VXX 17 puts, although the ship may have sailed on our SLB trade. However, I’ll take a closer look and see if it’s worth rolling out SLB to a later date.

December 10, 2019 - 6:28 pm

Insiders,

It’s almost the end of the year so let’s look at a broad basket of futures performance for the year and see how some major asset classes and commodities have performed. While I imagine most of you were not trading palladium, I suspect the great performance in the Nasdaq-100 and S&P 500 helped a lot of portfolios. The big year for crude oil may have assisted as well. On the flip side, natural gas has once again had a rough year – although it was hedged to some extent by oil. The VIX is at the bottom but of course percentage moves in the VIX index are meaningless because of the nature of how the volatility index works.

December 6, 2019 - 5:06 pm

Insiders,

Weekly video is up. There’s a point late in the video where I say “You Know” about 20 times in the course of 2 minutes, so that should provide some amusement for you. Apparently I need to go back to Toastmasters and remind myself how to speak full sentences that don’t end with “You Know”…

Here’s the link:

https://content.jwplatform.com/videos/nimS7lLL-bK67iJnL.mp4

December 4, 2019 - 12:22 pm

Insiders,

New trade alert!

Okay, this is the move we wanted to see in volatility if our next move is taking a short position in VXX. You can see from the chart that contango has steepened again (it went from 7% yesterday to 11% today). That’s our cue to enter a short volatility trade. Rather than use a put spread and buy extra time, we’re going to outright buy a put in VXX with just a couple weeks to expiration.

See the trade details below – go ahead and enter this trade when you can:

December 3, 2019 - 12:08 pm

Insiders,

Finally some volatility! I’ve attached two different screenshots. First, our usual chart of sector volatility shows an obvious increase in volatility nearly across the board. Second, I’ve included a picture of the VIX term structure we’ve been discussing a lot lately. You can see that the VIX index (green line) has moved up to the futures curve. Now we have the potential setup for a new volatility trade. If the VIX futures curve (blue line) is still in contango tomorrow (front month cheaper than second month) then we can put on a short volatility trade (likely a VXX put spread). Otherwise, we may consider buying a VXX call spread if the curve flattens out. I think the short volatility trade is far more likely though. Stay tuned!

December 2, 2019 - 5:25 pm

Insiders,

One new feature I’m implementing for Options Insiders is quicker access to the bi-weekly Option Floor Trader Pro trades. Normally, the OFT Pro issues come out at the end of the day on Tuesday (since it has to go through my publisher). I’m going to send you the trade details on Monday so you have a chance to get a price that more accurately reflects the price that I record (when I send the trade in to my publish the day before the issue comes out). In the future, I’ll try to get these early trades to you during market hours, but you’ll still be able to make this trade first thing tomorrow morning (which will be likely several hours before the issue comes out).

Here are the trade details:

November 29, 2019 - 2:58 pm

Insiders,

Weekly video is up. I talk all about using the VIX for trading, and in particular the trading strategy we discussed in the live session on Tuesday (with the replay sent out on Wednesday).

Video Link:

https://content.jwplatform.com/videos/Z0N5w8tr-bK67iJnL.mp4

November 27, 2019 - 3:46 pm

Insiders,

I talked a bit about this last night but wanted to show the difference between the current VIX futures versus the same day a year ago. That is, let’s compare market volatility between now and then. Back month VIX futures aren’t as far apart as you may expect, although it was clearly higher last year. The huge and obvious difference here is short-term futures, which is generally where a vast majority of the action is. Short-term volatility looks like it’s being sold (shorted) like crazy. The steep slope in the curve generally means you can effectively utilize a short volatility strategy like the one I discussed in the live session.

November 26, 2019 - 4:04 pm

Insiders,

Don’t forget about our live session at 8 pm EST tonight. I’ve got a new options backtesting toy and I use it to show you a simple strategy you can do on your own with a very high success rate. Come check it out!

November 25, 2019 - 5:04 pm

Insiders,

Just a quick heads up that our live monthly strategy session is tomorrow night at 8 pm EST. It’s normally on Thursdays but since Thanksgiving is this week, we’re doing it on a Tuesday night. I’ll send out a reminder tomorrow as well.

November 25, 2019 - 4:00 pm

Insiders,

Just an absolute pummeling today of volatility, nearly across all sectors. The exception you can see below is in Utilities, but that’s probably nothing more than noise at this point. I think the main reason behind the cratering of market volatility is due to the Thanksgiving holiday week. It’s a shortened week and a lot of people are on vacation. Plus, there isn’t expected to be much in the way of news in the next few days. I was hoping to get a chance to buy a put spread on VXX this week for Insiders, but I’m not sure it’s worth it at this point. Perhaps there’ll be more volatility buyers after the holiday.

November 22, 2019 - 4:07 pm

Hey Insiders,

Weekly video is up! Here’s the link:

https://content.jwplatform.com/videos/OcazP7Db-bK67iJnL.mp4

November 22, 2019 - 2:00 pm

Insiders,

Let’s close the AKAM call butterfly. It hasn’t gone up high enough to turn a profit, but it’s still in the money so we definitely want to close it out. The price may fluctuate quite a bit based on the stock price. I’m starting with 20 cents (net credit) and you can just move the price down until it gets filled. If the stock does climb by the end of the day, you could also get a higher price. Just remember all the value now is in that 88 call so look at its bid/ask to figure out your closing price. See below for the order screen I used to place the closing order.

November 21, 2019 - 4:53 pm

Insiders,

Our AKAM call butterfly expires tomorrow and it’s just 43 cents from being in-the-money. Basically, if it’s an up day tomorrow we should be able to close for a profit. If we stay where we are, the trade will still have some value in the morning and we can close for a partial loss. If the stock goes down, it will become worthless in a hurry. I’ll send out an action item tomorrow as soon as we see how the stock is going to perform.

Stocks ended the day pretty flat with the VIX slightly above 13. That’s low volatility, but nearly as low as it can go (it’s been under 9). The funny thing is you can argue that the VIX is way too high or way too low depending on your perspective. There seems to be a fair of geopolitical and global economic risk on table (hence the VIX may be too low). On the other hand, stocks have basically done nothing lately and realized volatility is about as low as it ever gets (hence the VIX is too high). There’s legitimately a compelling argument for either side – which is why I’m currently not picking a side and we’re staying neutral volatility for now with our trades.

November 20, 2019 - 4:22 pm

Insiders,

SPY (the S&P 500 ETF) was down almost a half percent today, which actually constitutes a big move in these days of zero volatility. SPY implied volatility climbed 2.6% to 10.8%. That’s still extremely low, but could perhaps be a sign that we’ve hit a bottom in volatility for now. As you can see below, a vast majority of S&P 500 component stocks increased in volatility today, but still over half of them remain in the subdued category for volatility overall.

November 19, 2019 - 5:08 pm

Insiders,

Another day with major stock indices not doing much. However, there was a minor move higher in implied volatility across the three major indices we watch, as seen below. Does anyone else feel like the market is waiting for something big to happen? It doesn’t seem to be trade war-related though because there’s been plenty of news on that front. I’m still not yet ready to buy volatility, but I’d be terrified to short it here.

In the meantime, our AKAM trade is in-the-money and we’ll look to close it soon for a profit.

November 15, 2019 - 3:28 pm

Insiders,

Weekly Video is up!

Here’s the link:

https://content.jwplatform.com/videos/Spu0UuCG-bK67iJnL.mp4

November 15, 2019 - 1:17 pm

Insiders,

Let’s do a new trade. We currently have a bullish trade on in AKAM, so let’s pair it with a bearish trade. For this trade, we’ll use a straight put debit spread instead of a put butterfly as the stock I’m using is only around $ 35 (making options cheaper). Speaking of the stock, it’s Schlumberger (SLB) which makes equipment primarily for the fossil fuels industry. Everything about this stock looks negative right now, so we’re betting on a pullback in the next month. You can see the trade in the screenshot below. The max loss is $ 0.87 or whatever you spend in premium, while max gain is $ 2.13 if we get down to $ 32 in the share price.

November 14, 2019 - 6:01 pm

Insiders,

I’m looking at doing a new trade tomorrow, so keep an eye out for that. In the meantime, here’ s a snapshot of major market ETFs. While the S&P 500 remains subdued, we’re starting to see some volatility action in other asset classes. Government bonds are in the “elevated” category but still well off their 52-week highs. Will any of this action spill over into US stocks? Right now, it doesn’t seem to matter, but we’ll see how the next batch of economic numbers look.

November 13, 2019 - 5:45 pm

Insiders,

Check out this chart of SPX (S&P 500 index) versus VIX (S&P 500 volatility index). While these product are supposed to move roughly inverse each other (-85% correlation), the gap between the two has gotten very wide. The amount of complacency in the market is at extreme levels. Of course, there’s no reason why this can’t continue for a while long – however, the longer this goes on, the more likely something unexpected is going to happen to send volatility higher/stocks lower. Personally, I think we see at least one other reasonably-sized selloff before year-end… but timing the market is the hardest thing to do in investing. As always, stay tuned.

November 12, 2019 - 5:59 pm

Insiders,

Let’s take a quick look at just how low volatility has gotten lately. In yet another great tool from Marketchameleon.com, you can see how historical volatility has moved in SPY (the S&P 500 ETF). The green line includes the intraday high and low of SPY (along with the open and close) while the red is just your standard to close to close volatility. Even including intraday action, you can see there has been almost no action in SPY. In fact, realized volatility has gone from a high of over 20 in September to about 7 currently.

November 11, 2019 - 4:49 pm

Insiders,

Despite it being a government holiday, the stock market was open today (although the bond market was not). Generally days like this are really low volume and not much meaningful action takes place. (Plus, a lot of traders/investors take 3-day weekends.) I’m looking at doing a trade later in the week. I have a few different ideas in mind, which depend on how things shake out in the next couple days.

November 8, 2019 - 4:57 pm

Insiders,

Weekly Video is up. Here’s the link:

https://content.jwplatform.com/videos/azwlDGsY-bK67iJnL.mp4

November 8, 2019 - 1:47 pm

Insiders,

We’re not going to get a chance to cash in on either VXX or EWZ, so you can let both expire (no action needed). EWZ has finally made a big move down today, but too little too late. I’m not rolling either of these trades out because macro-conditions have changed in recent weeks. I’ll post a weekly video later today to talk more about our positions.

November 6, 2019 - 4:23 pm

Insiders,

Slow day in the markets with the major stock indices and volatility very flat. Seems like the market is waiting for news. I won’t be in contact tomorrow because of the my trip to Las Vegas for the TradersExpo, but I’ll have plenty to talk about on Friday. Stay tuned! (Also check out my live stream tomorrow if you get the chance – the link for registration is in yesterday’s post.)

November 5, 2019 - 4:56 pm

Insiders,

Not much action today in stocks but volatility was up a little – pretty neutral day overall. We may see more of this type of action as the market waits for more economic data. Also just a reminder that I’m speaking in Las Vegas at TradersExpo on Thursday. You can actually live stream my presentation! Here’s the link to register for the live steam if you’re interested:

https://conferences.moneyshow.com/tradersexpo-las-vegas/live-stream/registration/?scode=049009&inf_contact_key=57dde27cf785f5b42f373b6b218b07b7680f8914173f9191b1c0223e68310bb1

November 1, 2019 - 5:28 pm

Insiders,

Weekly video is now up. Follow the link below for my ramblings on the current state of the market, economy, and our portfolios.

Video Link:

https://content.jwplatform.com/videos/7M8QHXOz-bK67iJnL.mp4

November 1, 2019 - 1:31 pm

Trade Alert:

First off, for those of you in AMAT, we need the stock to drop below $ 54 to make the call butterfly worth selling (it’s at about $ 54.70 as I write this). If that happens, I’ll send out a text alert. Otherwise, we can let it expire worthless.

Okay, moving on to our next trade – we’ll stick to a bullish theme since it seems like stocks only want to go up. (In the case of AMAT, it went up too much, so we’ll go bit wider on this next call butterfly.) The company I like for this trade is Akamai Technologies (AKAM), which makes cloud security software. AKAM just recently posted earnings that beat on both revenue and profits – and they raised full year guidance. The crowd must have been expecting something otherworldly because the stock price went down from about $ 90 to $ 87 on the news. Everything I’ve read is still very positive and let’s not forget the overall market is reaching new highs as well. We’re going to buy a call butterfly which will make money on a return to $ 91 (with a profit range between mid $ 88 and mid $ 93).

Trade Details:

See screenshot below. I’m showing a 1-lot example but you can do more if you like the trade – it will only cost you about $ 60 per butterfly. Max loss is also just the premium paid while max gain is $ 240 at a $ 91 share price on expiration, with a profit range from $ 88.60 to $ 93.40.

October 31, 2019 - 6:09 pm

Insiders,

The market was down this Halloween, but it wasn’t all that scary. Just a quick snapshot of the sector shows that while implied volatility moved up, it’s still plenty subdued overall. Tomorrow I plan to add a new Insiders-only trade, so keep an eye out for that in the text alerts.

October 29, 2019 - 1:19 pm

Insiders,

Well, it was probably just a matter of time but all major sectors now have subdued volatility. Investors are now (seemingly) fully bought i to the bull market thesis. It’s hard to argue with it given the news cycle lately. It appears that the Fed is the only impediment now to stocks soaring to even higher highs. I don’t consider myself a contrarian, but it just feels like there’s too much optimism at the moment, like we we’re waiting for the other shoe to drop. Let’s see what the Fed does tomorrow.

October 25, 2019 - 4:56 pm

Insiders,

Weekly video is up. Here’s the link:

https://content.jwplatform.com/videos/G7yhveob-bK67iJnL.mp4

October 24, 2019 - 3:40 pm

Insiders,

The email reminders for tonight’s live webinar did not get sent out by mistake. As such, we’re going to move the webinar to Monday night at 8pm EST. You’ll get email reminders (hopefully) about this time change. I’ll send you text alerts as well. Hopefully Monday night works out for most of you as we have plenty of options material to discuss!

October 23, 2019 - 5:57 pm

Insiders,

Very cool pie chart and synopsis regarding today’s options volume. Not surprising to see the tech activity given earnings this week are heavy with tech names.

October 22, 2019 - 8:13 pm

Insiders,

Just a quick look at the VIX, the S&P 500 Volatility Index, and our primary measure of market volatility. You can see that volatility is starting to tick higher over the last few days. This could be due to next week’s Fed meeting, or perhaps the market just deems market volatility too low given the various sources of potential risk out there.

October 21, 2019 - 7:38 pm

Insiders,

Another up day for stocks and another plastering of implied volatility. Looking at the implied volatility movers in S&P 500 stocks, you can see that 76% of the components declined today. There’s still 37% of the stocks in the “elevated” range for IV, but that’s likely due to earnings coming up in several stocks. If the market continues at this pace, once earnings season is over that pie chart is going to be mostly blue before too long.

October 18, 2019 - 5:34 pm

Insiders,

Weekly video is up at the link below:

https://content.jwplatform.com/videos/5ChjExHu-bK67iJnL.mp4

October 18, 2019 - 12:23 pm

Insiders,

Neither the VXX nor EWZ trade is close enough to the money to make it worth rolling. However, we are going to put both trades back on right now because I still believe strongly in both trade ideas (and volatility is really cheap right now). We’ll buy a little extra time this go round (November 8th expiration). Please see screenshots for both new trades below – they are debit vertical spreads just like before but using slightly different strikes.

October 17, 2019 - 5:26 pm

Insiders,

Here’s the latest sector volatility snapshot. I still think volatility is way too low here, but so far there’s nothing that’s come out the last few days to cause a spike in volatility. It’s probably a matter of time before some sort of headline sends stocks down for a few days, at least that’s been the pattern so far. Of course, there’s also the Fed meeting at the end of the month which could make a big difference in investor perception of the market. We shall see soon enough.

October 16, 2019 - 3:25 pm

Insiders,

Updating our positions – we’ll roll out the VXX call spread prior to the end of the week. EWZ is on the borderline – we may close it or roll it depending on what it does tomorrow. AMAT is still in good shape and we just need to wait until closer to expiration to cash out. Regarding a new trade, I’m looking at something for early next week, possibly gold related.

October 14, 2019 - 5:57 pm

Insiders,

Weekly video is up at the link below. The next weekly video will come out at the normal time next Friday afternoon.

Video link:

https://content.jwplatform.com/videos/LuPL3H19-bK67iJnL.mp4

October 14, 2019 - 4:06 pm

Insiders,

I’ll have a new weekly video out later today, but first here are a couple pics from my adventure in Northern Arizona this past weekend. The first one is (obviously) the Grand Canyon, the second one is my kids playing on a massive trunk of petrified wood at the Petrified Forest National Monument.

October 9, 2019 - 3:09 pm

Insiders,

I’m not ready to close VXX or EWZ at these levels, as I prefer to wait for a market down day. However, I won’t have access to this text alert system on Thursday or Friday (I’ll be at the Grand Canyon with my family). So, if over the next two days, VXX shoots higher or EWZ drops a lot, you can definitely close those trades without waiting for a closing alert from me. I’ll address the trades next week regardless, but don’t hesitate to take profits this week if you are happy with the results. There is plenty of action in the markets this week, so make sure to keep an eye on your portfolio. Also, just a reminder that our weekly video will come out on Monday instead of Friday.

October 8, 2019 - 7:17 pm

Insiders,

All the sectors except Materials are back to having elevated volatility. The materials ETF only traded 8,000 options today, so that may explain the lack of volatility elevation. Once again, it makes sense to tread carefully in this environment. I’m also considering closing our VXX and/or EWZ spreads tomorrow if we open up down, as both are currently winning trades.

October 7, 2019 - 6:37 pm

Insiders,

Just a quick glance at the 3 major market index ETFs. You can see the broad market (SPY), small caps (IWM), and tech stocks (QQQ) all dropped a small amount while 30-day implied volatility (IV30) climbed a bit (mostly at the end of the day). In addition, there was a pretty heavy skew towards put action. There’s definitely headline risk this week (geopolitical mostly), but very glad we have that VXX call spread on right now in our portfolio.

October 4, 2019 - 3:50 pm

Insiders,

The weekly video is up! See the link below. Next week I’ll be visiting the Grand Canyon so the weekly video will come out on Monday.

Video Link:

https://content.jwplatform.com/videos/ZWDMQm2x-bK67iJnL.mp4

October 3, 2019 - 3:13 pm

Insiders,

We have a couple bearish-type trades in our portfolio, but I want to have something bullish as well if/when the market stabilizes. The trade I found for this purpose is in Applied Materials (AMAT), which is one of the few tech stocks and only semiconductor stock that has shown strength during the recent market selloff. In order to keep our risk low, we are going to use a call butterfly that expires on November 1st (before earnings). If you haven’t executed a butterfly before, use the screenshot below to place the same trade in your own brokerage account. We can only lose the premium paid on the trade ($ 35 – $ 45 per butterfly) while profiting if the share price ends up between roughly $ 50.40 and $ 53.60, with max gain right at $ 52 (about $ 160 in gains per butterfly). If you don’t get this trade in today since it’s coming out near the close, you should be able to do something very similar tomorrow.

Trade Details:

October 2, 2019 - 4:57 pm

Insiders,

Hello volatility. I’ll let the charts below speak for themselves. Our EWZ and VXX trades are looking good at the moment.

October 1, 2019 - 7:35 pm

Insiders,

Just a quick glance at the S&P 500 sectors. While volatility may still be at moderate levels overall, you can see the large increases in IV30 (30-day implied volatility) percentages across the board. The three sectors with the biggest increases are consumer discretionary, financial, and industrial. Industrial should be no surprise after the big miss in the ISM manufacturing number – and that may provide us with a trade opportunity as well. Stay tuned.

September 27, 2019 - 5:36 pm

Insiders,

I just recorded the weekly video and it’s now ready for viewing. Here’s the link:

https://content.jwplatform.com/videos/S7ISf4vo-bK67iJnL.mp4

September 26, 2019 - 3:06 pm

Insiders,

Just another quick reminder that we have our live webinar tonight. Hope you can tune in!

September 25, 2019 - 1:07 pm

Insiders,

While our VXX 26-29 call spread still has a little value left, I want to roll it out a couple weeks and also down a strike. With impeachment gaining real steam, I think it makes sense to have a long volatility position in our portfolio for at least a few more weeks. In the screenshot below, I used a “custom” strategy to show you how to roll the spread out and down in one trade. You should be able to do something similar in your own brokerage simply by copying the legs of this trade. If your broker won’t allow you to create a custom trade like this, it’s okay to just close the first spread and open a new one in two separate trades.

The new spread we are rolling to is the VXX October 18th 25-28 call spread. If you roll the trade as seen below it should cost somewhere between 50 to 55 cents (debit).

Trade Details:

September 24, 2019 - 7:11 pm

Insiders,

Market volatility climbed today with the impeachment news hitting during market hours. As you can see from the table below, all sectors but utilities are now at a moderate level of implied volatility. Three sectors moved from subdued to moderate. The highest relative implied volatility is from the tech sector (no surprise as it’s usually the most volatile) which is in the 60th percentile compared to its median level. Nothing outlandish in here just yet, but definitely worth keeping an eye on.

September 23, 2019 - 6:54 pm

Insiders,

Looking at the chart below, it compares major market ETFs current implied volatility to their 52-week range. You can see that the only elevated volatility right now is in gold (GLD) and bonds (TLT). Oil (USO) is a bit elevated but still at a moderate level overall. Basically, the market is really calm right now – almost too calm. That’s why we made that EWZ trade last week and it may be a reason why the market is caught off guard if we get hit with any negative headlines. For more details on the chart and the ETFs, check out the table below the chart.

September 20, 2019 - 5:19 pm

Insiders,

Our issues with our video hosting software have been rectified. The weekly video is now ready to view.

Video Link:

https://content.jwplatform.com/videos/Y2DV0rBJ-bK67iJnL.mp4

September 20, 2019 - 1:45 pm

Insiders,

Let’s talk about the two trades that expire today and make a new trade.

First off, the HYG put butterfly is going to expire worthless so no action necessary. It’s disappointing because it looked like it was going to be a solid winner a couple days after we made the trade but has since climbed back above $ 87. We didn’t spend much at all on the trade, but it’s too bad it didn’t hang out at that $ 86.50 level just a bit longer.

The ARGT call butterfly will also expire worthless, although it hasn’t been close to getting above $ 25 so no surprise there. Also no action needed.

While Argentina did not pay off for us, I have another South American trade to make that looks very promising. I recently noticed that volatility in iShares MSCI Brazil ETF (EWZ) is quite a bit lower than normal. It’s due for some reversion to the mean as Brazil tends to have more volatile stocks overall. Higher volatility implies a down move, so we’re going to buy a put spread in EWZ. There’s plenty of macroeconomic and political risk that could easily cause Brazilian stocks to sell off as well.

Here’s the trade – I recommend doing from 1 to 3 puts spreads depending on your comfort level with the trade:

September 18, 2019 - 4:01 pm

Insiders,

The Fed cut rates by 25 basis points today, which was the most likely scenario. The market reaction has been muted so far. Sometimes it takes a day for the true reaction to hit, so we’ll see what tomorrow may bring.
The market is currently betting 50/50 on a rate cut at the October meeting – so for the first time in a while, the market has no idea what the Fed will do next.
Separately, crude oil prices have dropped back down to pre-drone attack levels. Not sure if there’s opportunity for a trade there at this point.
Regardless, we’ll do a new trade at some point before the end of the week, so stay tuned!

September 16, 2019 - 5:31 pm

Insiders,

I’ve recorded the weekly video but currently our video hosting website is having technical issues. As such, it doesn’t look like the video will come out today. Hopefully the issue will be resolved by tomorrow. I’ll keep you posted.

September 16, 2019 - 2:18 pm

Insiders,

There’s plenty of action in the market with crude oil up 15% after the attack in Saudi Arabia this weekend. However, I think you should first take a quick moment to appreciate the beauty and serenity of nature. I took this on Friday in an abandoned mining town outside of Ouray, CO (accessible only by off-road vehicle). This was a big area for silver and gold mining in the late 1800’s. Now the primary source of revenue is from tourism and you can certainly see why.

September 11, 2019 - 5:11 pm

Insiders,

A few comments before I drop off the grid tomorrow:

As a reminder, I won’t be doing the Friday Weekly Video, instead it will come out on Monday when I return from my trip.
I’ll most likely be entirely off the grid (in the mountains in sparsely populated regions) so I probably won’t see any emails until Sunday. I’ll do my best to respond to any emails I miss once I return on Sunday or Monday.
Entirely different subject, but after years of under-performance, value investing is finally looking strong again. It’s pretty amazing but it seems like the value switch has been flipped on for the moment. That’s good news for me as I’m a value investor at heart and we can take advantage of it using options. Let’s see if it continues to hold.

September 10, 2019 - 2:30 pm

Insiders,

Let’s make a trade! As I’ve said previously, I think volatility is too low given the amount of macroeconomic risk on the table (plus global political risk as well). We also have the Fed meeting coming up later in September which will be widely followed and analyzed by the market. It’s a good time to buy a little short-term volatility, especially if we can get it for cheap. To accomplish that, we’ll use iPath S&P 500 VIX Short-Term Futures ETN (VXX) and buy a call spread to keep costs low. We only need to go through September 27th as that will cover the next Fed meeting.

Trade:

BUY TO OPEN the VXX September 27th 26-29 call spread for around $ 0.52. (See the screenshot below for exact order details.)

We are buying the 26 call and selling the 29 call at the same time. VXX is trading at $ 24.65 but it can move up in a hurry if volatility hits the market. The most we can lose is the premium spent (so $ 52 per call spread) and we can make $ 248 per spread at max gain ($ 300 spread width minus $ 52 for premium costs). The breakeven point is at $ 26.52 in VXX at expiration and max gain is at $ 29 or above.

Trade Details:

September 9, 2019 - 6:53 pm

Insiders,

Interesting view of where the implied volatility is today across sectors compared to the 52-week highs and lows. You can see we are back near the lows in volatility, almost across the board. In my opinion, volatility is way too low compared to the level of global macroeconomic and political risk. As such, we will be buying volatility this week for our Insiders trade, likely through a VXX call spread.

September 6, 2019 - 5:04 pm

Insiders,

Weekly Video is up. Next week I’ll be out of town on Friday so the video will come out on Monday. Have a great weekend!

Here’s the video link:

https://content.jwplatform.com/videos/VlzaOdZL-bK67iJnL.mp4

September 4, 2019 - 3:08 pm

Insiders,

Finally there’s a bit of separation between the VIX term structure (blue), VIX Index (green), and 30-day historical volatility (red) as seen below. While it’s not a significant change, this is at least some indication that volatility traders (including hedgers) may be developing a more defined opinion on where volatility is headed. The futures curve is also in slight contango, generally a sign that market volatility is softening. If this keeps up, I expect to see a decent rally in stocks, assuming it isn’t derailed by a tweet or unexpected headline.

September 3, 2019 - 4:29 pm

Insiders,

There was a big move down in HYG today (25 cents is a lot for that ETF to move in one day) and it is very good for our put butterfly we just placed last week. For the moment, the butterfly moved up to 21 cents from our 15 cent purchase price. However, if we sit at these levels, our position will be worth 45 cents at expiration, or 200% higher. Of course, there’s still over two weeks to go and we will continue to increase profits as we get closer to $ 86 in the share price. In other words, we’re off to a great start with this trade. (If you have FXE on from the OFT Pro, you should also be very happy with the move today!)

August 30, 2019 - 4:47 pm

Insiders,

Weekly Video is up. I cover a lot in this one, so it should give you something to ponder over the long weekend!

Video Link:

https://content.jwplatform.com/videos/U6gANyUs-bK67iJnL.mp4

August 29, 2019 - 1:53 pm

Insiders,

I’ve spent quite a while this week searching for a great trade for us and I think I finally found something that checks all the boxes. It fits in with my macro view of the global economy and it puts very low capital at risk.

There are those who believe the bond market is a bubble right now and could be due for a significant reversal. While I’m not sure I would use the term bubble, I do think a pullback in bond prices is coming. This goes for government bonds as well as corporate and high yield bonds. What’s interesting is that iShares iBoxx $ High Yield Corporate Bond ETF (HYG) has also been climbing and is close to 52-week highs. That’s strange to me considering the amount of macroeconomic risk on the horizon. Bonds are considered safe, but high yield bonds are a very different asset class than government bonds. HYG has two potential headwinds – money flowing from high yield to safer assets if the economy is in trouble and/or the bond bubble deflating in general.

HYG doesn’t move all that much, so the options are cheap. Nevertheless, I want to use a put butterfly for this trade so you can choose to do several more contracts if you like the strategy. A 1-lot butterfly will only cost about $ 15 (around $ 25 with commissions) and I used a 5-lot in my example, which is still less than 0 total cost. See below for trade details.

We are buying the September 20th 87-86-85 put butterfly with HYG trading around $ 87.30. It should cost about $ 0.15. The premium paid is our max loss. Max gain is at $ 86 in HYG on expiration day in 22 days. We would generate $ 85 per butterfly (minus commissions) at max gain. However, we don’t need to hit max gain for this to be a great trade. Anywhere between $ 85.15 and $ 86.85 is a profitable range for us. Given commission costs, it probably makes sense to do more than one butterfly.

Trade Details:

August 28, 2019 - 5:32 pm

Insiders,

I’m looking at doing a new trade tomorrow, so stay tuned. In the meantime, check out the VIX term structure (futures curve), VIX spot price (index value), and historical volatility (realized last 30-days) below. Once again they are all in nearly the exact same level. This to me is a big sign that no one really knows what to expect, that is, there’s no sense of what’s coming next. I think it makes a lot of sense to take mostly defensive positions until the dust settles.

August 26, 2019 - 5:46 pm

Insiders,

I’m not a buyer of this rally. There’s going to have to be a lot more progress on the trade war front for me to become bullish again. Please be careful out there. I highly recommend hedges or defensive positions to go along with your standard portfolio. We’re doing something defensive in the OFT Pro tomorrow and we’ll also do something similarly defensive in a new Insiders trade at some point this week.

August 23, 2019 - 5:14 pm

Insiders,

Weekly video is now available. After talking about the market action and our positions, I get into a couple examples of using some of the tools I discussed last night during the live session. Hopefully it will help explain some of the material more clearly.

Video Link:

https://content.jwplatform.com/videos/Cli2NMvV-bK67iJnL.mp4

August 22, 2019 - 6:00 pm

Insiders,

Don’t forget to tune into tonight’s live session. After we cover the market conditions and portfolio review, I’m going to discuss some tools I use to analyze trading opportunities.

See you then!

August 20, 2019 - 5:10 pm

Insiders,

Interesting observation in the world of volatility: The VIX spot price, the VIX term structure (futures), and S&P 500 30-day historical volatility are all really near each other. Can’t say I’ve ever seen this before. If I had to guess I would say it means implied volatility is going higher, but you never know in a market so easily driven by headlines/tweets.

August 19, 2019 - 5:32 pm

Insiders,

I posted the “chart” below on Twitter as a joke today. It was my response to what I’ve been seeing in financial/social media lately. Basically, there are so many crazy charts coming out of the woodwork suggesting the stock market is going to crash or go to a million. Just remember, playing with numbers until you find a relationship doesn’t also mean those numbers are useful for forecasting. Enjoy my chart comedy!

August 16, 2019 - 5:36 pm

Insiders,

Weekly video is up. We discuss our portfolio plus everything you ever wanted to know about negative interest rates but were afraid to ask!

Video Link:

https://content.jwplatform.com/videos/jKIal0D4-bK67iJnL.mp4

August 15, 2019 - 4:16 pm

Insiders,

Let’s take a quick look at the state of market volatility in two charts. The first is today’s VIX term structure at market closing. You can see the curve is clearly in backwardation. This suggests plenty of concern among investors, especially at the institutional levels. We’ll want to see this curve flatten out (and eventually move back into contango) as a sign that risk is coming down. Scroll down for the next chart.

The second chart add the actual, realized volatility over the last 10 days (HV 10 – yellow dotted line). As high as the VIX has been, the market has been that much more volatility over the last two weeks. In other words, there may be even more volatility ahead that market hasn’t even priced in yet. Stay vigilant out there!

August 14, 2019 - 1:59 pm

Insiders,

I have a really fun trade for us today – something very different than you may have expected. With all the craziness in the US markets, you may not have heard that the stock market in Argentina crashed this week. It was down something like 30% in ONE DAY due to the results of an election (where the business-friendly candidate performed far worse than expected). Here’s the chart:

As you can imagine, this is probably an overreaction. Surprisingly though, there was very little options activity in the largest Argentina ETF, Global X MSCI Argentina ETF (ARGT). I think the crash may have been mostly unnoticed because of the US market volatility or because many investors don’t know how to trade it. Well, we’re going to take a shot that the market will recover somewhat by September expiration. And, we’re going to do it cheaply by using a call butterfly.

Trade recommendation:

Buy the ARGT September 20th 25-27-29 call butterfly for around $ 0.42.

The markets are pretty wide so I put an order in to test it out and got filled at 42 cents. Anywhere you can filled around the price is fine, just make sure your order screen looks like mine below. The range from 25.42 to 28.58 is profitable for us, with max gain coming at 27 on expiration. We can only lose what we spend on the trade, or $ 42 per butterfly.

Trade Details:

August 13, 2019 - 3:57 pm

Insiders,

The market has certainly been more volatile lately and it just so happens that I have an upcoming webinar called “Options Strategies for Higher Volatility” that I’m doing for the Options Industry Council. The webinar is on August 21st at 3:30 PM CST and is completely free to attend. You can sign up here if interested:

https://event.on24.com/eventRegistration/EventLobbyServlet?target=reg20.jsp&partnerref=oicwebsite&eventid=2016662&sessionid=1&key=7A237DB985772438EA24DFA77916D465&regTag=&sourcepage=register

August 9, 2019 - 4:23 pm

Insiders,

Weekly video is now available. Besides plenty of market commentary, I have a pretty robust education section today that I think you’ll enjoy.

Have a great weekend!

Video Link:

https://content.jwplatform.com/videos/eSzd21Au-bK67iJnL.mp4

August 8, 2019 - 5:31 pm

Insiders,

The market has rebounded sharply the last two days and we’re now back at last Friday’s levels. I don’t really buy this rally as there is a lot of global macro risk to be wary of. That’s not to say that stocks can’t keep climbing back to all-time highs, but I’m certainly not positioning my portfolio that way. I prefer to hedge against a major selloff and look for opportunities in individual assets.

For our trade next week, I’m still looking at doing a butterfly trade on earnings. One candidate I’m looking at is Walmart (WMT), which has earnings on the 15th. If we do an earnings trade, this time around, we’ll wait until the day before earnings to do the trade so we don’t have to worry about stock drift before hand.

If the market gets crazy, we may hold off on an earnings trade and do something more macro-based. We’ll see what next week brings before deciding.

August 7, 2019 - 3:45 pm

Insiders,

Disney earnings turned out to be a dud, which is both very surprising and also annoying. I really wanted you to see why I enjoy using the butterfly strategy, and I thought DIS was a near perfect setup. Alas, if the market always cooperated than it wouldn’t make trading nearly as interesting. Despite the failure of this trade, I still believe that butterflies are great strategies for earnings trades and I plan to try a new one in the next few days for an earnings release next week. I’ll try to find something under 50 cents this time as the only thing I didn’t like about the DIS trade was it was a bit expensive for a butterfly.

Regarding the DIS butterfly, you don’t have to do anything to close it as it will expire worthless on its own.

August 6, 2019 - 4:22 pm

Insiders,

Shocking earnings miss by Disney after close today. It’s so far from what’s expected that I had to read the numbers three times to make sure I wasn’t seeing things. The stock is down about 4% after hours, but the earnings calls has yet to take place. Perhaps there will be an explanation on the call that will ease investors.

While it’s highly unlikely at this point that our butterfly is going to be in play, you never know what could change by tomorrow. If this quarter’s miss can be explained away and investors like the future potential, we could still get a rally by the end of the week. Once again, not likely, but stranger things have happened.

In the meantime, this is why I prefer butterflies over straight call spreads, we’re risking much less capital on a very short-term trade.

August 5, 2019 - 2:04 pm

Insiders,

Let’s look at what a volatility explosion looks like. Take a look at the VIX term structure below. The VIX curve on Friday (black line) was already pretty flat, generally an important signal that investors are concerned. Well, look at the curve today (blue line) – that’s full on backwardation. As long as we have an inverted curve like this, it essentially means investors are willing to pay up for portfolio protection, i.e. they’re terrified of a crash. Also notice the actual VIX price (green dotted line) is almost 23, well above the futures price. Right now, it suggests that futures market believes the market is overreacting. We’ll see if this holds over the next couple days.

August 2, 2019 - 4:12 pm

Insiders,

Weekly video is now up. I discuss the Disney call butterfly in detail as well as market conditions and open trades. Good stuff!

https://content.jwplatform.com/videos/QtF2nDYN-bK67iJnL.mp4

August 2, 2019 - 11:49 am

Insiders,

Well it took until the final day of the trade (expiration), but we nailed the VXX 25-28 call spread. Let’s close it now for a winner – see the trade details below for how to enter the order. I’m showing 1.26 on my screen, which would work out to a 117% winner. We’ll take it!

Trade Details:

August 1, 2019 - 12:51 pm

Insiders,

Let’s make a butterfly trade! We’re going to take a bullish position on Disney (DIS) based on earnings next week (Tuesday). I think DIS will beat earnings and the stock will go higher. We’ll use a call butterfly to keep the premium costs lower. I’ll discuss the details and reasoning behind this trade on the video tomorrow. If you’ve never traded a butterfly before, just enter it exactly as shown below. This is a debit trade, so if you can trade spreads in your account, you should be able to execute this trade all at once. You’ll want to enter a net debit limit order as seen below, somewhere around the midpoint of the bid/ask spread (around $ 0.95). We can only lose what we pay for the trade (so around $ 95 for one butterfly) and we make money anywhere between a share price of $ 145.95 and $ 154.05 by Friday of next week. Max gain of $ 405 would be hit if settle at a $ 150 stock price at expiration. Please be aware that it’s a 1 by 2 by 1 spread so two contracts of the 150 strike are sold (even if you are only doing 1 butterfly contact).

Trade Details:

July 31, 2019 - 5:34 pm

Insiders,

A lot of exciting stuff happened today, especially as the baseball trade deadline hit. Just kidding, it was FOMC day! Before we talk about the Fed, just wanted to give you a heads up that I have a really cool idea for a butterfly trade that we’ll look at doing tomorrow. I’ll then discuss it in more detail on Friday’s video.

Okay, back to the Fed. As most of us expected, the Fed cut interest rates by a quarter point. However, my personal opinion was that after this, the Fed was going to a wait and see mode (and that differed from the market, which expected another rate cut in September). Well, it turns out that the Fed may in fact just do a one-and-done cut, which they claim is “insurance” against a downturn. Now, the futures market is only betting 56.5% that a cut in September will happen. That’s very much up in the air.

I think the uncertainty of another cut will be good for our IYR puts. It will be interesting to see how stocks and market volatility react for the remainder of the week.

Stay tuned tomorrow for our new Insider trade!

July 29, 2019 - 4:02 pm

Insiders,

It’s Fed week! The FOMC meeting results are released on Wednesday so get ready for some market action that afternoon and possibly on Thursday. Right now, futures markets are betting 75% on a quarter point rate cut and 25% on a half point cut. I’d be shocked if the half point cut happens though. What’s interesting is that the futures market also shows a 75% probably of another cut at the September meeting. That’s the one that really is the biggest wild card. It will be really interesting to see how the futures market changes after we see what the Fed says on Wednesday. As always, stay tuned.

July 26, 2019 - 5:26 pm

Insiders,

Weekly video is up! Here’s the link:

https://content.jwplatform.com/videos/gkNZf3Xm-bK67iJnL.mp4

July 25, 2019 - 4:18 pm

Insiders,

Don’t forget to tune in to the live session tonight! Lots of interesting topics to discuss and plenty of time for Q&A.

July 25, 2019 - 12:22 pm

Insiders,

We were hoping for FCX to move today… and move it did, precisely to where we wanted it the least. The stock is currently trading within 5 cents of our long straddle. We either wanted it to go a little higher or much lower today… instead it went almost exactly to our straddle strike. I don’t see any reason to wait another day on this trade (which expires tomorrow). We still have about 24 cents left in our 63-cent straddle, so let’s go ahead and close and we’ll find a better trade to do next week.

SELL TO CLOSE the FCX July 26th 11.5 call and put (the 11.5 straddle) for around $ 0.24.

Anywhere around this price is fine. You should be able to close both options as one transaction. Be sure you close before close tomorrow as we don’t want to have any of the options exercised into shares. See the screenshot below for details.

Trade Details:

July 24, 2019 - 5:29 pm

Insiders,

Regarding the FCX trade: The stock is just under $ 12 which values our straddle at around $ 0.53. We paid $ 0.63 so we’re right in the ballpark of our trade cost. The plan is to close tomorrow regardless of what the share price does. If the stock goes up another $ 0.10 or so, we’ll break even or make money, so we are definitely FCX bulls for one more day.

July 23, 2019 - 5:10 pm

Insiders,

Regarding the FCX trade – earnings hit before market open tomorrow, so we’d like to see a big move in either direction. The chart below shows why I think the straddle we purchased is cheap. You can see that 4 out of the last 5 earnings periods the stock has moved more than the implied straddle. Let’s see what tomorrow brings!

July 22, 2019 - 1:49 pm

Insiders,

Let’s add a new trade today. I mentioned the Freeport-Mcmoran (FCX) trade last Friday during the video and decided over the weekend it is worth doing.

Here’s the trade:

BUY TO OPEN the FCX July 26th 11.5 straddle (buying both the call and put at the 11.5 strike) for a $ 0.63 debit.

You should be able to do this as one order with your broker. Anywhere around this price is fine – it shouldn’t move much before earnings which are Wednesday morning. I recommend buying up to 3 straddles (I did 2). This is a very short-term trade. We are betting that FCX is going to move more than the straddle price (63 cents) after earnings. The trade expires on Friday and earnings are on Wednesday. Breakeven points are at $ 10.87 and $ 12.13 (with the stock around $ 11.50 at the time of the trade).

Trade Details:

July 19, 2019 - 4:47 pm

Insiders,

Weekly Video is now up. Have a great weekend!

Video Link:

https://content.jwplatform.com/videos/uIFdBEZg-bK67iJnL.mp4

July 19, 2019 - 2:30 pm

Insiders,

Keep an eye out for our weekly video later today. Just a heads up – there won’t be a new trade in the video. Instead I will send one out via text on Monday. There are a couple things I’m watching and I’d like to see how things play out over the weekend.

July 18, 2019 - 3:00 pm

Insiders,

We sent out an email today reminding you to add your phone number to our text alert system if you haven’t yet – so hopefully this text is reaching several more of you who haven’t been getting these to date.

Just wanted to point out that silver has been soaring lately. Our SLV calls we bought at $ 0.51 are now trading at $ 1.40. That’s a 175% gain! I think we’ll hold it for now, but we may close soon if this keeps up.

July 17, 2019 - 3:04 pm

Insiders,

Remember that USO July 19th 12 put/12.5 call trade (strangle) we made a few weeks back? Expiration is coming up Friday and USO has dropped to .78 – so you probably want to consider closing it anytime now. The move didn’t happen fast enough to make money on the trade, but we can close right now for over 30 cents and conserve a decent portion of the premium cost. I’d suggest closing today if you got into this trade, but make 100% sure you close no matter by the end of Friday so you don’t automatically exercise your in-the-money options and end up short USO shares.

By the way, we’ll look at a new trade Insider-only trade in Friday’s weekly video, so be prepared!

July 15, 2019 - 7:41 pm

Insiders,

Get ready tomorrow for double-trade issue of OFT Pro. It’s the biggest issue yet, which two brand new trades I’m excited about. I also have a link to a video of a winning trade I made in Options Profit Engine, my credit spread trading service. If you’re curious what’s involved in credit spread trading, you can watch the video tomorrow and see what kind of trades we do over there on a regular basis.

July 12, 2019 - 5:37 pm

Insiders,

Weekly Video is up! Have a great weekend and be ready for two new trades in the OFT Pro issue next Tuesday.

Video Link:

https://content.jwplatform.com/videos/znJQDHq1-bK67iJnL.mp4

July 11, 2019 - 4:18 pm

Insiders,

I came across an interesting block trade today in FXE, which is the ETF that tracks the Euro currency. It’s a strangle trade which makes money if FXE (or the Euro for that matter) moves in either direction. See the chart below:

You can see from the payoff diagram that FXE (trading currently at 107) basically needs to drop below 105 or climb above 110 for this strangle to make money. It’s a September 20th expiration, so about 2 months away. The interesting thing is that FXE has essentially traded between 106 and 109 for the entire year. This trade, which was done 1,000 times, suggests the Euro may be ready to break out in one direction or the other. A move of this magnitude could suggest major economic shifts ahead in the Euro region. It could be something to keep an eye on, or even trade if you’re so inclined.

July 10, 2019 - 4:37 pm

Insiders,

It’s interesting to see what market volatility is doing with stocks at all-time highs. The VIX (S&P 500 implied volatility index) has come down for sure, from over 15 for most of June down to 13 today. You can see it in the chart below (the green dotted line), but notice how the VIX futures remain elevated (the blue line). Essentially that means that VIX futures (which are actively traded by institutions) aren’t suggesting that volatility is going to continue to drop in a significant manner. Another interesting point from the chart is historical volatility (the actual, realized movement in the S&P 500 and the red dotted line below) is not that far below the VIX spot price. I’ve seen this gap get a lot larger, so about 2% difference isn’t that much of a volatility premium. I believe this also implies that volatility isn’t likely to drop much further than the current levels.

July 8, 2019 - 2:55 pm

Insiders,

Okay, here’s the trade I talked about on Friday that you can execute today. This VXX trade gives us long volatility exposure through the next Fed meeting at the end of July, which could be a very big event for the markets. See the screenshot below for the details of the trade. It’s a call spread in VXX that expires the first week of August (August 2nd), buying the 25 call and selling the 28 call. It should cost around $ 0.60, but you try to get filled first at the midpoint ($ 0.58 in my screenshot but it may move by the time you enter the order). Let me know if you have questions.

July 5, 2019 - 5:40 pm

As promised, some pics from the beach! San Diego is a great place to vacation if you haven’t had the chance to visit. I highly recommend it.

July 5, 2019 - 5:18 pm

Hey Insiders,

Here’s the weekly video. Enjoy!

https://content.jwplatform.com/videos/Nv2O2s2k-bK67iJnL.mp4

June 28, 2019 - 5:01 pm

Insiders,

Weekly Video is up! Here’s the link:

https://content.jwplatform.com/videos/5u0BcFaN-bK67iJnL.mp4

June 28, 2019 - 3:55 pm

Insiders,

I’ll have my weekly video coming out in the next hour or so, but in the meantime, the replay of last night’s webinar is now available here:

https://www.investorsalley.com/options-insider-weekly-video-channel/

If you aren’t logged into your member account, you’ll have to do that first before the video will play. Enjoy!

June 27, 2019 - 3:11 pm

Insiders,

Live session is tonight! Don’t forget to come with any options questions you have.

June 26, 2019 - 5:42 pm

Insiders,

Don’t forget about our live session tomorrow night at 8 pm EST/5 pm PST.

The market isn’t buying that we’re close to a trade deal with China. After an initial pop in stocks, the major indices mostly ended up nearly unchanged. Volatility also stayed flat. It will be interesting to see what develops this week since next week may be slow due to the Thursday holiday.

June 25, 2019 - 6:38 pm

Insiders,

First off, a reminder that our very first live session is this Thursday at 8 pm EST/5 pm PST! We’ll talk about our recent trades, the market in general, and just about any options topic you want to cover during the Q&A. I hope you can all attend live, but there will also be a recording available if you can’t make it.

USO hasn’t done much since our trade, but VXX is starting to climb higher. We’ll talk more about the Insider trades on Thursday.

June 24, 2019 - 12:45 pm

Insiders,

My video came out after the market closed on Friday so if you are interested in doing that USO strangle today, there are a couple choices:

The original trade suggestion was buying the July 19th 12.5 call and 12 put. USO is down a little, but you can still get the trade for about $ 0.80.

A second, similar choice (because USO is down a little from Friday) would be to buy the July 19th 12 call and 11.5 put, which is a slightly more bullish trade and costs about $ 0.75.

Either trade is fine if you want to play a possible big move in oil over the next month.

June 21, 2019 - 4:09 pm

Insiders,

New weekly video is up! Here’s the link:

https://content.jwplatform.com/videos/XLHthcny-bK67iJnL.mp4

June 20, 2019 - 7:31 pm

Insiders,

I wanted to show you some order sentiment data for SPY (the S&P 500 ETF) from my friends over at marketchameleon.com.

You can see that the 30-day average was pretty strongly bearish for SPY. The 5-day average is slightly less bearish. Today, it’s downright bullish. The sentiment has clearly changed over the last couple days to bullish. Now I’m not saying I agree that we should all be bullish, but I wanted to share what the options market thinks at the moment.

June 19, 2019 - 7:35 pm

Insiders,

The Fed didn’t cut rates today (not a surprise based on the futures market) but did say they would act accordingly if the economy showed signs of slowing. The futures market is still predicting two rate cuts by the end of September. Stocks basically did nothing and volatility dropped after the news.

I still don’t see two rate cuts coming in the next 3 months, but the economic news may change. I like our XLF position here because we are set up for either scenario. Let’s see what happens to stocks for the remainder of the week.

June 18, 2019 - 5:57 pm

Insiders,

FOMC day tomorrow! It could be really interesting how the market reacts to what the Fed says (and does). That’s especially true now that the market rallied sharply today on positive news related to the China trade war.

The market isn’t expecting a rate cut per se, but is certainly focusing on the Fed language – and how dovish it is. I think investors will end up being disappointed regardless of what the Fed does, but we’ll see if it’s countered by what comes out of the White House.

I’ll send a message tomorrow after the FOMC results come out. Stay tuned!

June 17, 2019 - 7:26 pm

Insiders,

The picture below is of the CME’s Fed Watch Tool and shows the probability the Fed Fund futures are placing on various rate cuts by the December meeting, If you add up the left three columns, you can see that the market is placing over a 50% probability that 3 rate cuts will happen by the end of the year. I think this is too dovish. I think two cuts is a safer estimate. We’ll know more after Wednesday’s FOMC meeting, so stay tuned!

June 14, 2019 - 2:51 pm

Insiders Weekly Video is up! Here’s the link:

https://content.jwplatform.com/videos/lji4hNFg-bK67iJnL.mp4

June 13, 2019 - 5:01 pm

Interesting development today with the oil tankers being attacked off the coast of Iran. Oil futures are only up a couple percent right now, but it could be quite a bit more bullish if this situation escalates into further military activity. We may look at some potential options trades involving oil-related stocks or ETFs for next Tuesday’s OFT Pro issue. Let’s see what oil prices do tomorrow after having a day to digest the news.

June 12, 2019 - 4:30 pm

Insiders,

I recorded a video not that long ago with my friends at marketchameleon.com – a great options analytics site. This particular video is basically a Q&A on calendar and diagonal spreads. If you’re interested, check it out here:

https://www.youtube.com/watch?v=iQz7BT8kvac

June 10, 2019 - 1:58 pm

Insiders,

We’ve been having some issues with our text alert system, so this is first and foremost a test. However, I want to mention that I don’t buy this stock market rally. Volatility traders don’t buy it either, judging by the VIX – which is still at elevated levels. That’s not to say that we can’t have several more days or weeks of bullish stock activity. However, unless the economic fundamentals change, I would be cautious about going all in right now. At the very least, I think it makes sense to hedge your portfolio with index/ETF puts (SPY, QQQ) or long VIX ETF calls (VXX, UVXY).

June 7, 2019 - 7:37 am

This is a test of the Options Insider alerts. 2019-06-07 7:37 a.m. ET.

June 6, 2019 - 4:52 pm

Insiders,

We continue to get lots of new Insider signups, which I’m really excited about. There are a lot of really interesting aspects to options we can talk about and strategies we can learn. I hope to get plenty of feedback and suggestions from you as well. Don’t hesitate to email me whenever you want to talk options at [email protected].

For tomorrow, we’ll have a new video where we’ll talk about the SLV trade and also I’ll recommend a new FANG-related trade based on the anti-trust talk coming out this week. I won’t send out separate trade alerts though – these will be more casual trades for those who want to have some additional action. We’ll also use vertical spreads, something I won’t do in the normal OFT Pro service.

I’m really looking forward to working with the Insiders and I hope you all enjoy this new product!

June 5, 2019 - 4:06 pm

Insiders,

The futures market is now pricing in over a 60% chance that the Fed drops rate at the July FOMC meeting. What’s more, there’s over a 50% chance of TWO rate cuts by the September meeting, according to the futures. Is the Fed reacting to the negative impact of the trade war, or are they really that concerned about an impending recession? I’m guessing it’s a mix of both factors. That’s one reason why we grabbed SLV yesterday, as it should do well in the face of both lower rates and a possible recession.

For Insiders only, I’ll look at another trade opportunity in my video for Friday. I’m looking at the FANG stocks after the recent anti-trust news from Monday. Stay tuned.

June 3, 2019 - 4:10 pm

Insiders,

We have our biweekly trade coming out tomorrow, but there is so much going on that it was hard to find just one strategy to focus on. With the anti-trust news coming out today in regard to the FANG stocks, well, that opens up a a whole new can of worms. I’m not going to use any of the FANG stocks for tomorrow’s trade, but I’m thinking of doing a special trade just for Insiders on our Friday video that will involve at least one of the FANG companies. As always, send me any thoughts or questions you have to [email protected]

May 31, 2019 - 4:12 pm

Here’s the link to our first weekly video session. Feel free to email me at [email protected] and let me know what you think!

https://content.jwplatform.com/videos/ERMRdgwr-bK67iJnL.mp4

May 31, 2019 - 2:10 pm

Welcome to Options Insiders!

This is my first ever message to Insiders, so congratulations on being part of the inaugural message! I’ll also have a video coming out later today, so stay tuned for that.

The market has definitely been more volatile this week, with the VIX (S&P 500 volatility index) up to about 18. For the VIX, which measures overall market volatility, the median is around 15 or 16. We are definitely on the high side of market volatility, but certainly nowhere near panic range. Over 20 in the VIX is where we start to worry about big selloffs, and over 30 is really where you want to be fully hedged or in cash.

Right now, there is some concern – mostly due to the tariffs imposed on China and Mexico and how it will impact the US economy. It’s sign to be cautious, but certainly no reason to sell all your stocks and buy gold/bonds/cryptocurrencies/etc.

In my video later today, we’ll take a closer look at the VIX and how to analyze it for signals or warnings.

It’s not goodbye, it’s hello Magnifi!

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