Articles from the Experts

Our experts offer free thoughts on the market almost every day. Follow the links to the articles on their sites to learn more about how they trade and what brokerage firms they use.

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Trading Block: OPEC: Oil prices to stay below $100 for next decade. April U.S. options volume at 327.6m, down from March as spreads tighten. Highlights from The Options Industry Conference in Miami last week.

Odd Block: Calls and puts trade in the SPDR S&P 500 ETF (SPY), puts trade in Altisource Portfolio Solutions (ASPS), and calls trade in Iron Mountain Inc. (IRM)

Strategy Block: Tosaw discusses selling calendar spreads

Mail Block: Listener questions and comments

  • Question from Nicolas Bougie: Many Thanks for [Russell] Rhodes podcast you guys put online. Very educational! My question to you guys is: What is your personal favorite trading platform and why? What platform would you suggest to someone starting in this business?

Around the Block: Earnings! Wednesday - Cisco, JC Penney, Macys. Thursday - Kohls, Nordstrom, King Digital

Trading Block: Bond, James Bond. A bullish bond market rally could be in our future. VIX going into Non-Farm Payroll - could we see a big move?

Odd Block: Puts trade in Whole Foods Market, Inc. (WFM), puts go up in iShares iBoxx High Yield Corp ETF (HYG), calls trade in Alibaba Group Holding Ltd (BABA)

Mail Block: Listener questions and comments

  • Question from Dmitry Shesterin: Where do you see more HFT activity, in equities markets or options?
  • Question from Tom: When should I adjust a credit spread? What percentage of profit should I aim for?
  • Question from Fred: I am a futures guy dabbling in options. Do options traders need different tool than futures traders? If so, what tools or services do you recommend outside of the broker platforms?
  • Question from Karl: What is the better way to get "free juice" on a bullish position - bullish risk reversal for a credit/even, vertical ratio call spread for a credit/even or just a short put for a credit (obviously). This would be for a near term (a few months), but not explosive (maybe to 5%) rally in the underlying. When is buying the stock the best option?

Strategy Block: Uncle Mike Tosaw discusses selling puts.

Around the Block: Looking ahead to non-farms

Option Block 429: Avenging Pacquiao

Trading Block: Bonds taking it on the chin. Disney stock soars, lifted by the superhero power of The Avengers. CBOE reports 35% of their total volume is from weeklys.

 

 

Odd Block: Puts roll in iShares Russell 2000 index ETF (IWM), massive put block trade in SouFun Holdings Ltd (SFUN), and puts trade in Clean Energy Fuels Corp. (CLNE)

 

Outside Trading Hours: In his brand new segment, Mark Sebastian discusses the NFLs latest move to remove tax-except status.

 

 

Around the Block: Earnings

Option Block 428: The Thorax of the Trade

Trading Block: Tattoo snafu inks Apple iWatch wearers. Options volume slid in first quarter. Bad sign? Retail investors all in: TD Ameritrade. The dollar is on its longest losing streak since 2011. India VIX caps monthly advance as futures rollover below average. Tesla loses ground ahead of battery event.

 

 

Odd Block: Calls trade in PowerShares DB US Dollar Index (UUP), calls trade in Kinder Morgan Inc. (KMI), and puts trade in Youku Tudou Inc. (YOKU)

 

Mail Block: Listener questions and comments

  • Question from Nick - I have heard markets spend 30% of time trending and 70% of time bracketing. Can I use options to trade both of these environments?
  • Question from Alan - Why is rolling a position so prominent? Is that not just averaging into a losing trade?
  • Question from Anglo Jim - We saw a trending bull market for most of 2014. Is it simplistic to say that you could have just bought out-of-the-money calls and done fairly well? What about that decay that you are always talking about? Does that become a factor in that strategy, or does the bull market overcome it?
  • Question from Orlando - I am thinking of using weeklys to initiate debit vertical call spreads. Is that a good use case for them?
  • Comment from Mark Brant - @Options Great Option Block episode! I got even smarter about options again! The gift that keeps on giving: OIR. Thx!

 

 

Around the Block: Earnings: Apple & other earnings expected to dominate the week of April 27. Friday - Chevron, Weyerhaeuser

Option Block 427: Rocking AAPL Earnings

Trading Block: AAPL earnings after the bell.

AAPL Stats:

·  ATM weekly straddle: $7.20 - approx 5.4%.

·  ADV: 988K contracts.

·  Today: 1.7M contracts.

·  Call/put ratio: 2.1/1.

·  Net deltas: short 670k.

·  Calls sold on bid roughly equal to calls bought on ask - puts also evenly divided.

·  AAPL volatility bets surge in options market as buyback beckons.

Investors seek protection against healthcare stock decline - Healthcare companies on a seven-year tear have been top performers so far in 2015. Love ’em or Hate ’em, China Stocks Are Red Hot in Options Market - Bearish options bets on the Deutsche X-trackers Harvest CSI 300 China A-Shares ETF.

Odd Block: Calls go up in iShares MSCI Taiwan Index (EWT), call blocks trading in Joy Global Inc. (JOY), and OTM puts trade in Direct TV (DTV)

Strategy Block: Tosaw discusses hedging AAPL and other earnings strategies.

Mail Block: Listener questions and comments

  • Question from Cab 65 - What account size do you recommend to sell wide iron condors?

Rock Block: In which the all-stars discuss movies in the Michael Bay oeuvre. Let us know your thoughts on Facebook, Twitter, or by email

Which Nicholas Cage movie is the best?

  1. The Rock
  2. Con Air
  3. Face Off

Who does the best “Welcome to the rock” interpretation?

  1. Uncle Mike
  2.  The greasy meatball
  3. Mark “the voice of options” Longo

Around the Block: Earnings: AAPL & other earnings expected to dominate the week of April 27.

 

 

Option Block 426: Hedging Crude Oil Is Not Rocket Science

Trading Block: NASDAQ composite rises above March 2000 record close. Roots of 'flash crash' go back further than you thought at CME. Oil jumps 3 percent, hits 2015 high on Yemen, supply concern. Earnings today include (before the bell): GM, Procter and Gamble, Caterpillar, Dow Chemical, Southwest Airlines, Dunkin Brand Groups; and (after the bell): Google, Microsoft, Starbucks, Amazon, Capital One, E-Trade Financial, Pandora.

 

Odd Block: Giant put buyer in The CBOE Volatility Index (VIX), and calls trade in iShares MSCI Taiwan Index (EWT)

Mail Block: Listener questions and comments

  • Question from Vegan - What oil products do airlines use to hedge their crude exposure?
  • Question from Nick - I have heard markets spend 30% of time trending and 70% of time bracketing. Can I use options to trade both of those environments?
  • Question from Alan - Why is rolling a position so prominent? Is that no just averaging into a losing trade?
  • Question from Evan - For Uncle Mike - I am long the Apple July 130-140 call spread. What do you think about this both for an earnings play, as well as for some longer term bullish exposure to Apple? What are some other bullish strategies you could recommend for a modest ten-point rally over the next three months?
  • Comment from Mark Brant - Great Option Block episode! I got even smarter about options again! The gift that keeps on giving: OIR. Thx! 

 

Around the Block: More earnings. Friday, April 24 - American Airlines, Xerox, Tyco International. Monday, April 27 - Apple, Inc.

Option Block 425: Scratching Heads & Taking Names

Trading Block: A mild day on the street. IBM Earnings after the bell today - IBM trading around $164.30. Costco stock rises today after upping dividend - reauthorizing $4B buyback program. This is how one trader made millions on Disney - shares of Walt Disney have had a great year.

 

 

Odd Block: Calls trade in Owens Corning (OC), puts trade in Wolverine World Wide, Inc. (WWW), and calls trade in Spectra Energy Corp. (SE).

Strategy Block: Tosaw discusses ways in which to protect your portfolio.

 

 

Mail Block: Listener questions and comments

  • Question from Sean - Can you do a quick overview of binary options? How do they differ from regular options, and when should people use them? How do I choose my strike with binary options?

Around the Block: Earnings: Morgan Stanley, Facebook, Coke. Some huge names report earnings this week.

 

Option Block 424: NFLX and the Roll to Oblivion

Trading Block: The "Widowmaker" rides again - NFLX has a HUGE post-earnings rally, up $56. BATS to file for second U.S. options exchange. IPO: Stock of online marketplace Etsy surges in trading debut. Shares of high-speed trading company Virtu Financial Inc. have risen 17 percent in their stock market debut Thursday. Ben Bernanke is not the problem, the system is the problem.

 

Odd Block: Calls trade in Kinder Morgan Inc. (KMI), puts trade in iShares MSCI Turkey ETF (TUR), and broken wing put flies go up in Royal Bank of Canada (RY)

 

Mail Block Palooza: Listener questions and comments

 

 

  • Question from Tom - When should I adjust a credit spread? What percentage of profit should I aim for?
  • Question from DuckTape - Can you guys recommend any good movies about options trading?

Option Block 423: Unusual Activity Palooza

Trading Block: How traders cashed in big on the GE deal. VIX does record volume - it’s been a while.

 

Odd Block: Calls trade in Dunkin Brands Group (DNKN), puts trade in Valero Energy Corp. (VLO), calls trade in AT&T (T).

 

Strategy Block: A special strategy block from Andrew about volatility

 

 

Mail Block: Question from Ingles - I like options, but the commissions are killing me! Why are they so expensive?

 

Around the Block: Earnings!

  • Tuesday - JP Morgan, Wells Fargo, Intel Corporation
  • Wednesday - Bank of America, Netflix, Inc., SanDisk Corporation
  • Thursday - Goldman Sachs, Citigroup Inc., American Express Company
  • Friday - General Electric Company

TRADING BLOCK

  • Crazy realized volatility going down in Hong Kong markets - EWH.
  • The Apple Watch release.
  • Its time for the "Global Derivatives" guessing game.  

ODD BLOCK

  • Calls trade in ConocoPhillips (COP)
  • Puts trade in Crestwood Equity Partners LP (CEQP)
  • Calls trade in New Oriental Education & Tech (EDU

MAIL BLOCK

  • Question from Mark Brant - When to close weekly short option positions on expiration friday?  Morning or afternoon? Plus Mark wins the Options Insider Radio Network devoted listener prize for listening to EVERY episode of every program on the network. Very impressive.
  • Question from NJay - OTM options are reasonably priced - should I buy them? 

 

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