Trade idea
Trade idea short puts
We're going to sell puts and we're never going to flip those cards over.
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Strategyshort puts
Assetoptions
Entry / triggerwhen the sell-off doesn't stop
SpeakerSpeaker 1
Trade idea
Trade idea put calendar
This is a calendar spread, which I thought was super cheap.
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Strategyput calendar
Assetoptions
ExpirationSE with 30 days
Entry / triggerright around the same price, right around a $160,$165
Target / exitright around a $160,$165
Speakerspeaker
Structure / legs- buying the O 95 puts
- selling the SE 95 puts
Trade idea
Trade idea puts
The speaker is selling puts at 3500 and 3600, indicating a bullish or neutral stance on the underlying asset.
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Strategyputs
Assetoptions
Entry / triggerselling the 3500 puts, the 3600 puts
SpeakerUnknown
Risks- The underlying asset could move significantly against the position.
Trade idea
Trade idea selling
NQ puts are more capital efficient than QQQ puts
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Strategyselling
Assetoptions
Time horizonshort-term
Entry / triggerselling a 12 delta put on NQ
Target / exit10 times the size
Invalidation / stoptrade size
Speakerspeaker
Trade idea
Trade idea naked call
Selling naked calls on stocks with call skew can be advantageous due to higher pricing in the market.
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Strategynaked call
Assetoptions
Entry / triggerstock with call skew
SpeakerUnknown
Risks- Market movement against the position
Trade idea
Trade idea put
Market may not move significantly, allowing the put position to expire worthless
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Strategyput
Assetoptions
Expiration2023-08-18
Time horizon2 days
Entry / triggerSold 90 puts in August expiring on Friday
SpeakerTom Sosnoff
Risks- Market moves against the position
- Volatility spikes
Trade idea
Trade idea iron condor
iron condor is delta neutral and has no directional risk
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Strategyiron condor
Assetoptions
Entry / triggerwhen IVR is super high
Speakerunknown
Risks- market movement
- volatility changes
Trade idea
Trade idea long diagonal spreads
short-term, long diagonal spreads can be used on unleveraged products
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Strategylong diagonal spreads
Assetoptions
Time horizonshort-term
Entry / triggeron unleveraged products
Target / exitshort-term profit
SpeakerTonyy
Trade idea
Trade idea covered call
entry level trades are accessible for beginners
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Strategycovered call
Assetoptions
Time horizonentry level
Entry / triggerselling puts in the notes because this is a trade I made on Friday
Target / exitmax profit of $600
Invalidation / stopwaiting for a little bit of softness, maybe 34, 35
Speakerunknown
Risks- waiting for softness
- market movement
Trade idea
Trade idea diagonal spreads
short-dated plays are good in ETFs
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Strategydiagonal spreads
Assetoptions
Expirationclosest to 45 days
Time horizonshort-term
Entry / triggerlow volatility environment
Target / exitdirectional
Speakerspeaker
Trade idea
Trade idea unbalanced iron condor
collecting premium with limited risk
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Strategyunbalanced iron condor
Assetoptions
ExpirationSEP
Time horizon39 days
Entry / triggercollecting $4.70
Target / exitcollecting $4.80
Invalidation / stopimplied volatility rank
SpeakerTom
Structure / legs- SEP 260 250 put spread
- SEP 90 95 call spread
Risks- volatility changes
- market direction
Trade idea
NEX wide put spread
the biggest risk in natural gas is always upside moves
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Strategywide put spread
Assetoptions
Time horizonimmediate
Entry / triggervolatility is acting at 0.046
Target / exitvolatility to come to 0.47
Invalidation / stopmarkets are bid at 42, but it's 47 right now
SpeakerTom
Risks- volatility acting against the trade
- markets moving in the opposite direction
Q&A
What delta mees strangle would you sell and how far out would you go?
The speaker suggests selling a strangle with deltas between 16 to 22, and mentions that the expiration could be September or October, with a recommendation to roll to October in a week.
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Actionable takeawayThe speaker recommends selling a strangle with deltas between 16 to 22, with expiration in September or October, and suggests rolling to October.
Q&A
Does the 5 DTE include the weekend or is it just trading days?
The 5 DTE includes the weekend and is based on calendar days, not trading days.
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Actionable takeawayWhen calculating days to expiration for options, use calendar days rather than trading days.
Q&A
What is the strangle in Hood?
A strangle in Hood with 80 strike put and 115 strike call for about 240.
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Actionable takeawayThe speaker discusses a strangle in Hood with specific strike prices and a cost of 240.
Q&A
Have you ever been short an option and a three standard deviation move happens overnight?
The speaker acknowledges that this is a common scenario and that it can lead to significant losses.
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Actionable takeawayShorting options can lead to significant losses if a three standard deviation move occurs overnight.
Q&A
Is buying options a fair bet?
Buying options is not a fair bet as implied volatility can crush returns before the stock even moves. It does not pay, and the outlier move where it pays is rare and hard to achieve.
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Actionable takeawayAvoid buying options due to the risk of implied volatility crushing returns before any stock movement.
Q&A
What types of metrics do you guys look at to make the decision of should I put something on with 30 days or should I put something on at 60 days?
The decision is subjective and depends on volatility. In high volatility, shorter-term options (30 days) are preferred. In low volatility, longer-term options (60 days) are preferred to synthetically increase volatility exposure.
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Actionable takeawayIn low volatility environments, extend duration to longer-term options to synthetically increase volatility exposure.
Q&A
Is the best way to say that the NQ put and the QQQ put are similar?
They are similar in terms of buying power and leverage, but NQ is more capital efficient.
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Actionable takeawayNQ puts are more capital efficient than QQQ puts.
Q&A
Is the expected move on the weekly options for XYZ stock based on calculating all open interest in that stock's options?
No, the expected move is based on the options implied volatility, not open interest.
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Actionable takeawayThe expected move for options is calculated using implied volatility, not open interest.
Q&A
today's option models whether they're black shows or whatever you guys are calculating what happens if the liquidity like an 87 becomes so or the volatility and the liquidity becomes so skewed that everybody kind of walks away and the bids
The speaker suggests that even if liquidity or volatility becomes skewed, markets won't get too wide during the day. High-frequency firms have handled such situations, and models are based on normal liquidity. If spreads do widen, a contrarian approach could be taken, but it's unlikely. The speaker advises not to trade with the idea of 'monsters under the bed' and to focus on liquid products where you can trade both sides.
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Actionable takeawayModels are based on normal liquidity, and while spreads can widen, it's unlikely during the day. A contrarian approach could be considered if spreads get too wide, but it's not recommended to trade with the idea of extreme market events.
Q&A
Is writing calls against a large position risky?
The speaker suggests that writing calls against a large position is not risky to the market, but it could be risky for the counterparty. They emphasize that the market is not typically involved in such large trades.
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Actionable takeawayWriting calls against a large position may not be risky to the market, but it could be risky for the counterparty.
Q&A
What do you think about intel here?
The speaker likes Intel at 85 and suggests a long diagonal spread in Intel.
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Actionable takeawayThe speaker suggests a long diagonal spread in Intel at 85.
Q&A
What is the potential impact of zero day options on the market?
Zero day options, which are short-term options, have become a significant part of the market, accounting for 60% of S&P index buying. The speaker suggests that the market calm observed might be due to the short expiration dates of these options, which prevent significant market movements. The speaker also notes that the options clearing corporation initially had concerns about market risk and margin requirements but later moved away from these concerns.
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Actionable takeawayZero day options are a significant part of the market, and their short-term nature may contribute to market calm. Retail traders prefer short-term trading, and the market seems to accommodate this demand.
Q&A
Is XSP a better option than SPY for trading?
XSP is cash-settled and does not have the risk of stock price movements after the close, unlike SPY. However, XSP may involve additional fees and has different tax implications compared to SPY.
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Actionable takeawayXSP is suitable for traders who prefer cash-settled options and are willing to accept potential additional fees and tax implications.
Q&A
Is it normal for option traders to do well while stock traders struggle in a range-bound market?
Yes, it is normal. When option traders are successful, stock traders often struggle, and vice versa. This is due to the nature of their strategies and market conditions.
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Actionable takeawayOption traders and stock traders often have conflicting outcomes in range-bound markets due to their strategies.
Q&A
Does weekly daily or monthly expirations quarterly whatever it is now that we have daily expirations matter any longer?
It doesn't matter anymore because they roll all of their longer dated put on a 45 days to the next month when there's around 21 days to expiration.
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Actionable takeawayDaily expirations don't matter as they roll longer dated options.
Q&A
Does IVR really matter?
IVR (Implied Volatility Ratio) doesn't matter for a covered call strategy on existing stock holdings because the focus is on the direction of the stock. However, higher IVR can lead to higher premiums, which is a benefit.
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Actionable takeawayFor covered calls on existing stock holdings, focus on the stock's direction rather than IVR. Higher IVR can result in higher premiums.
Q&A
When SpaceX was trading at like in the 170 range, I I sold some puts. Okay. you know, at 155
The speaker sold puts at 155 when SpaceX was trading at 170, but the stock dropped significantly, leading to losses. The speaker had to roll the puts out and eventually recovered some of the losses.
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Actionable takeawayWhen selling puts, it's important to consider the expected move and not get too close to the money.
Q&A
That is the most I want to sell on Nvidia this year for tax purposes.
Roll calls forward to avoid assignment risk and large tax bill.
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Actionable takeawayRoll calls forward to avoid assignment risk and large tax bill.
Q&A
Where are the 100 puts?
The 100 puts are trading around $4.
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Actionable takeawayThe speaker is discussing the price of specific put options.
Q&A
Why did you have August 7th for SpaceX?
They don't have Fridays.
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Actionable takeawayOptions for SpaceX are available on the 7th, but not on Fridays.