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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 Option Block 343: AAPL Ratio Spread Madness Trading Block: A slow day on the street today. All Apple - all Amazon - nothing below the "A"s. OCC announces cleared contract volume declined in May, while 2014 volume remains up.
Odd Block: Call ratio spreads trade in Apple Inc. (AAPL), long-term closing call sale in Fortress Investment Group LLC (FIG), closing put buys before earnings trade in Ascena Retail Group Inc. (ASNA), and opening call seller in The Western Union Co (WU)
Xpress Block: Alex discusses Idea Hub for Schwab Mobile and possibly Futures Trading.
Strategy Block: Ratio Spreads: when and how to use them and why they teeter on the edge of dangerous.
Around the Block: ADP private-sector job growth & weekly jobless claims on the horizon. |
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Option Block 342: Mini Death Knell Trading Block: A mild uptick on the street today. Apple rallies and the market follows. With the VIX moving closer to its 9.39 historic low, many commentators are now discussing it as a "complacency index," writes John Nyaradi of Wall Street Sector Selector
Odd Block: Risk Reversal trades in iShares MSCI Australia Fund (EWA), call buyers trade in Scientific Games Corp. (SGMS), and call buy-writes trade in Ambev SA (ABEV)
Xpress Block: Alex discusses the recent NASDAQ notice and the death of minis.
Mail Block: Listener questions and comments Comment/Question from Kaiser Dog - Enjoyed todays podcasts. I felt the Viceroy came back with some very pertinent information. I myself have been using my iPad and even My iPhone a few times to initiate trades. The Mobile Trading option is gaining traction and I agree with Alex's sentiment that this has smoothed out trading flow. Especially in times that would be historically light volume. I myself prefer my Laptop trading station I have custom built. With that said the reality is that raising a 4 year old son takes a lot of time and attention. My Mobile App allows me to stay on top of things and still be a parent. The Mobile trading option is a huge success. The Polar Opposite of "Mini Options" in my opinion. I enjoyed the swing to a positive story from the depression that HFT and Minis cause me. lol. Question from DeGaul - What does the OH/Monster merger mean for the options brokerage landscape going forward? Question from Mr Teenzy - All this talk about colocation for HFT firms, but do brokers like OX not also co-locate to speed up transaction times? In which case, is colocation benefiting the retail guy like me?
Around the Block: Economic Data: First-quarter GDP revision (Thursday) and Personal Income and Spending, Chicago PMI and University of Michigan consumer sentiment (Friday). Fed talk: Fed's Pianalto: 'Inflation and Monetary Policy' |
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Option Block 341: Weird Activity In Colgate-Palmolive Trading Block: A surprising VIX given the upcoming holiday weekend. Record low levels in some beloved Option Block names. We saw a massive upside call going up in VIX early this week. The U.S. options exchanges are working jointly toward the development of a uniform obvious error rule to nullify or adjust transactions that meet the definition of an obvious or catastrophic error. OCC and US Options Exchange adopt pre and post-trading risk control principles. Odd Block:
Xpress/Mail Block: XpressMail….get it? OX questions this week:
Around the Block: Initial Jobless Claims Data and Homes Sales Report on Thursday -- Claims are expected to be higher. Notes from the FOMC meeting. |
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Option Block 340: Revenge of the Guts Strangle Trading Block: What will bring back volatility? A black swan event? Russell Rhoads said via MarketWatch that investors are showing a “justified complacency” given that recent VIX jumps don't stay at those levels for long. "One-off events," such as the Ukraine, get investors' attention for a while and then wanes. It's enough for a VIX spike but not enough to sustain it. From a black swan event in the economy and markets, it would have a greater, deeper effect. Odd Block: Calls buyers trade in Oncothyreon Inc. (ONTY), closing call buyers and put buyers trade in Gastar Exploration Inc (GST) - a closing guts strangle? Closing call sellers trade in Chemtura Corp (CHMT), and calls roll in iShares MSCI Brazil Index (EWZ). Xpress Block: Alex talks recent news from Charles Schwab (CEO suggests regulators require brokerage firms to disclose payment for order flow), as well as VIX ETNs. Around the Block: Is the housing market really coming back? The National Association of Realtors will release April existing home sales data Thursday and the U.S. Census Bureau reports sales numbers for newly constructed homes is out Friday. Earnings this week include Home Depot, Lowe's, Campbell Soup and Hewlett-Packard. |
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Option Block 339: Potential Front Running Activity Trading Block: Today we have a very special trading block segment from Uncle Mike Tosaw about Russell and RVX vol. Is VIX in a deep sleep? Odd Block: Combos trade in the iShares MSCI Emerging Markets (EEM), call spreads trade in Travelers Companies (TRV), calls trade in Expeditors International of Washington (EXPD), and calls trade in Chemtura Corp (CHMT) Xpress/Mail Block: We are mixing it up today with some questions from OX clients:
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Option Block 338: The Great Mobile Trading Debate Trading Block: A strong surge to the upside, Russell leading the charge. Russell 2000 index (RTY) option costs at Feb 2007 levels. Who is playing out in this product? Apple and Beats headphones - two Tosaw favorites.
Odd Block: Combos, rolling short stock position in Denderon Corp. (DNDN), call buyers trade in VeriFone Systems Inc. (PAY), call buyers trade in Hillshire Brands Co. (HSH), and put spread sellers trade in WisdomTree India Earnings (EPI)
Xpress Block: Alex talks about mobile app usage by the OX clientele and market-wide.
Strategy Block: Mike Tosaw discusses covered calls going in the money - and how that is a good thing.
Around the Block: Upcoming economic reports: Retail Sales (Tuesday), PPI (Wednesday) and CPI (Thursday). Still more earnings: CSCO - 5/14 after, COSI - 5/15 after, TTWO - 5/13 after. |
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Option Block 337: Looking Back on the Flash Crash Trading Block: Options traders were preparing for 10% swings of Tesla before week's end based on a straddle. On Wednesday, volume in Twitter options increased fivefold, all but erasing value in a series of bullish contracts. ICE reports record Q1 profit. After its June IPO, Euronext plans to be listed on three of its exchanges. May 6 marks the fourth anniversary and it's a reminder that not much has changed. Odd Block: Put sellers in BBEP, call spreads trade in Cameco Corp., calls trade in DLX, closing put seller in FTR. Strategy Block: Calendars vs. verticals, part deux.
Around the Block: Some earnings left: CSCO, TTWO, CBOE, GRPN. Macro, macro, macro, 10-year, 30-year, the Fed. Will social media/tech stocks hold up? |
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Option Block 336: Earnings and the Death of Minis Trading Block: A mild day on the street. Apple catching a bid. Tuesday’s computer error at NYSE ACRA and NYSE AMEX options markets resulted in almost 20,000 erroneous trades.
Odd Block: Call buyers trade in Nike Inc. (NKE), call sellers trade in Gilead Sciences, Inc. (GILD), put spreads trade in iShares Barclays 7-10 year Treasury ETF (IEF) - closing roll, and closing put buyers trade in NQ Mobile Inc. (NQ).
Xpress Block: Late May/Early June is the target date for enhancements to OX mobile, which will include single-leg walk limits, as well as OSO and OTO orders.
Mail Block: In which Option Pit steals the show. Website comment from Kaiserdog76: Loved todays Option Block. Especially the focus on Mini Options and their total failure. Mark Sebastian said it best when he talked about the people that really need a break in the Market getting "Bo Didley Squat" when the dust settles. I have all ways hated Minis. Talk about a getting "Stupid" on an option trade. One tenth the size but %100 the commission. Spreads wider than Honey Boo Boo. This product is a total joke and in my humble opinion never really lived. This was dead on takeoff. Website comment from Meatball-in-training: Great show. The question from one of your listeners about the trade scanner that keeps popping up two standard deviation ITM debit spreads was very interesting. Is it perhaps the case that the scanner is ignoring the cost of carry on the premium itself when looking at prospective trades? That is the sort of thing I can imagine someone overlooking when programming a trade scanner and for wide verticals with lots of time to expiration, it might be enough to make expensive debit spreads look superior to their synthetically equivalent credit spreads. I am one of Mark and Andrews’s students, so if this is all wrong, feel free to blame them. Tweet from OtC bOuNcEr$ @stevesokol21 - Is there a way to run a scan anywhere to find more stocks with that pattern? Thanks a lot for the help
Around the Block: Still some more earning left out there: ATVI - 5/6, CBOE - 5/6, DIS - 5/6, EA - 5/6, GRPN - 5/6, TSLA - 5/7 & PCLN - 5/8 |
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Option Block 335: The Giovinazzi/Tosaw Spectacular Trading Block: A slow day on the market today. TLT was one of the few things to light up the tape. Yellen, the Fed and bond buying. An update of the VIX and S&P with Andrew. Odd Block: Call buyers in Auxilium Phramaceuticals, Inc (AUXL) Call buyers jump into EQT Corp. (EQT) Call spreads trade in Verso Paper Corp (VRS) Calls roll in Mechel OAO (MTL) Strategy Block: A question/poll for our audience: Given the level of the VIX, is this market a better environment for doing verticals spreads or horizontal spreads? Around the Block: More earnings: XOM, LNKD, KRFT and EXPE. The biggest news will come for the jobs report on Friday. Will gold continue to slide? GDP? |
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Option Block 334: Are Mini Options Dead?
Trading Block: Close to close is only half the story today. Russell and the NASDAQ lead the way. Stocks that pay a nice dividend are clear outperforming stocks that do not. Three candidates selected to oversee OPRA. Odd Block: Puts go up in Diebold Inc (DBD) A three-way trade goes up in Range Resources Corp. (RRC) Calls buyers go up in Norhtstar Realty Finance Corp. (NRF) Put spread sales trade in Bank of America Corp (BAC) - potential roll down
Xpress Block: A continuing rotation out of momentum into more quality names. Apple, Amazon IBM and Microsoft were all hot on the OX desk today. Strategy Block: A two-part strategy block today. First, a few current strategies Uncle Mike is employing. Second, a trade for people who may not have been able to pull the trigger on a selling a bull put spread when the market was down today. Mail Block: Question from Jason Kruse - Has probably been asked & answered many times, and I have missed it.. Will $AAPL minis continue to trade after the split? Around the Block: A lot of economic news this week, including the Fed two-day FOMC meeting. On Monday, pending home sales and Dallas Fed manufacturing. More earnings: TWTR, MAR, CME & LKND |