Articles from the Experts

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Option Block 223: Making Money for the End of the World

Interview Block: Today's Guest: Ed Walczak, Principal Trader at Harbor Financial.  He specializes in options on the S&P futures contracts, and does everything from ratios to credit spreads.

Trading Block: Another day, another selloff, another VIX cash pop. The return of realized vol to the downside. Ford engine investigation. Is Uncle Mike reconsidering his 12 puts? Is Barnes and Noble next to go private? Zynga rallies 7.5% today. Exchange trend continuing -- CME to acquire DB? DB couldn't merge with NYSE, so why would regulators approve this? SEC examining how stock exchanges create new order types.

Odd Block: Steady buyers of Frontline Ltd (FRO) puts, and puts trade in Linn Co., LLC (LNCO).

Xpress Block: A blood-letting day at the OX desk. Expanding the Idea Hub for futures options. 

Around the Block: How long can we hold these levels of realized vol? GRPN 2/27

Option Block 222:  Bonds. Contrarian Bonds.

Trading Block: The majority of the market sold off by 1%.  On the news that bonds might sell off, they rallied. Apple breaks through 450. Google hanging around the 800 level.

Odd Block: A collar went up in Texas Roadhouse (TXRH); call spreads trade in Gerdau SA (GGB), and calls active in Blackstone Group (BX).

Xpress Block: SPX and April Condors are hopping.

Strategy Block: Today's strategy honors Hannibal Smith of the A-Team. Put selling strategies on SPY-- long-term bullish and short-term cautious.

Around the Block: Looking ahead at Tesla Motors. Keeping an eye on the S&P 500. Seeing if Google can stay near 800.

Option Block 221: Suspiciously Well-Timed Call Buying

Trading Block: The market was mixed today, with the VIX cash off slightly. GM profits down from 2011, stock down 3%. Jobless claims decrease last week. Zynga flirts with $4 before retreating back to $3. Former RIMM CEO dumps the rest of his stock, never a good sign. “CBOE Group Holdings Inc., which became a publicly held company in 2010 after years of effort, would consider going private again if doing so benefits its shareholders, a top executive said on Thursday.” PHLX's Sandy Frucher is getting OIC's Sullivan this year. Is the PHLX saga really worth celebrating?

Odd Block: Big call Activity in Hess Corp. (HES), and suspiciously well-timed call buying in Constellation Brands Inc. (STZ).

Xpress Block: It was a quiet day, with the exceptions of Facebook and Blackberry. A new pricing scheme in futures. What's new with implementing the Minis? The devil is in the details.

Mail Block: What do you want to know from the All-Stars?

Question from Filipp001: When SPX daily options?

Strategy Block: The credit spread with benefits.

Around the Block: Earnings are still coming up, including Tesla Motors 2/20, Marriot 2/20. Remember that Monday, Feb 18 is a non-trading day.

Option Block 220: Who Needs Annuities When You Can Sell Puts on GOOG?

Interview Block: Today's guest is Doug Berman, Vice President of Agriculture Derivatives, RCM Asset Management. He talks about

  • Why this is an extremely exciting time in the corn option market.
  • The unique relationship between implied volatility and pricing
  • How traditional strategies like covered calls/collars perform in the Ag realm vs. equity options 
  • On Wednesday, February 13, Doug will be sharing with us his ideas and systems for trading futures and options on corn.

Trading Block:A meandering day on the street today. We’re still deep in the earnings with CBOE, ATVI, MSFT, and CMG all rallying strong post-earnings. RIMM/BBRY staying strong as well. Apple watch is back on.

The Odd Block: Bullish put spread trades in Bank of America Corp. (BAC), small call block goes up in Superconductor Corp. (AMSC), aggressive opening call buyer in Walgreens Co. (WAG), and closing calls trade in Chilcott Ltd. (WCRX).

Xpress Block: Alex discusses some impending price changes in futures and futures options. Now $3.50! + exchange fees and NFA fees.

Around the Block: Cisco earnings 2/13, LivePerson 2/12, NVidia 2/13, Tesla 2/13. Watching Radian Group, Google and Apple.

 

Option Block 219: Trading Options to Infinity and Beyond

Trading Block: Zynga blows the doors off the market - the 2.5 puts were the sale of the century. Disney reported earlier this week, and is selling well. Activision gets a little bit of a bump to the upside. Shareholders filing suit against Apple as their cash reserve grows.

Odd Block: Puts trade in DeVry Inc. (DV), puts trade in JPMorgan Chase & Co. (JPM), and a big block of calls trades in Marathon Petroleum Corp. (MPC).

Xpress Block: Best Buy and Blackberry were popular at OX. A phenomenal amount of puts selling - short put call is 95% puts to calls.

Strategy Block: Mike Tosaw talks about implied volatility, and other side of the coin to vol.

Around the Block: CBOE earnings 2/8 before the bell. Cisco 2/13. Nvidea 2/13. Tesla Motors 2/13. The President's State of the Union address is Tuesday.

Option Block 218: Do Not Pay for Juice

Trading Block: Selloff keeps some life in the VIX cash. Profit taking, and rumbles out of Spain, weigh on the market. Facebook down 5%. Apple down 2%.

Odd Block: Puts trade in Dell Inc. (DELL), a massive 1x2 Call Spread Trades in Delphi Automotive PLC (DLPH), time spreads trade in Bruker BioSciences Corp. (BRKR), and calls trade in Questar Corp. (STR).

Xpress Block: Alex Jacobson discusses GLD volatility, SPX PM, and premiums. Of 256 companies reporting earning so far, 68.4% have beat estimates compared with a 62% average since 1994.

Mail Block: Let the All-Stars answer your questions.

  • Question from Alessandro - What does the all-star panel think of a long Ford 11-12 1x2 put spread for $.05?
  • Question from Bob G. - Do you guys prefer to go into earnings long or short volatility?
  • Question from Tony O. - Hey Uncle Mike, I’d like your opinion on going long the GLD March 155-168 bullish risk reversal for approximately even money? Or would you prefer to add a short 172 call kicker and collect about $.30?
  • Question from Mr. Mikey - Does the OX Idea Hub take into account changes in open interest when highlighting trading idea?

Around the Block: Earnings! Activision on 2/7 after the close, Chipotle on 2/5 after the close, CBOE 2/8 before the open. Plus, CBOE stock has been on a serious tear since ICE/NYSE merger announcement.

Option Block 217: Now What Are We Going to Watch?

Trading Block: Most of the major indexes closed fractionally down, weighed down by some less-than-stellar earnings. There was a bit of interesting activity in Facebook. RIMM, now known as BlackBerry, announced the new BlackBerry 10. Former founder of PFG sentenced to 50 years. Netflix pulls a reverse Widow Maker.

Odd Block: Big put spread goes up in Exxon Mobil Corp. (XOM), a large block of calls trade in Taiwan Semiconductor Inc. (TSM), a closing trade in Take-Two Interactive (TTWO), and puts trade in Expeditors International of Washington Inc. (EXPD)

Xpress Block: Chatter on the OX forums has been heavy in Netflix and Priceline. Not much movement in vol. 

Strategy Block: Tosaw discusses selling the put on Ford and buying call options.

Around the Block: Non-Farms comes out tomorrow. What is there to watch after that?

Option Block 216: Embracing Degeneracy

Trading Block: Most indexes closed fractionally up or down on the day. Vol continues to stay at record lows. Action in Ford and Facebook so far this week.

Odd Block: Puts trade in Western Union Co. (WU), a block of calls trade in Facebook Inc. (FB), and calls trade in Take-Two Interactive Software (TTWO).

Xpress Block: Alex discusses the latest from the Idea Hub, which included a lot of SPX PM ideas today. CFTC approved the Euro stock futures in the U.S. today.

Strategy Block: Great Uncle Mike Tosaw discusses selling puts on the S&P 500, a strategy they use at RCM.

Mail Block: The All-Stars answer listener questions.

  • Question from Tom S., Philadelphia -  Ford March 14 calls for $0.40 - Buy or Sell?
  • Question from Charles C., Cambridge, MA - What do you guys think of the Ford March 12-15 bullish risk reversal for even to a nickel debit?

Around the Block: Yahoo! earnings. Ford earnings tomorrow before the open. Facebook on 1/30, Amazon on 1/29, Electronic Arts on 1/30.

Option Block 215: Apple and More Apple

Trading Block: There was a pronounced selloff in Apple following earnings. The interesting news is that almost everything was up today, except Apple.

Odd Block: Unusual activity in CBOE, Infinera Corp. (INFN), and Stryker Corp. (SYK).

Around the Block: More earnings next week. There could potentially be a big move, given how low volatility has been recently.

Option Block 214:  Apple Moves and Hysteria Ensues

Trading Block: The markets actually moved today! Apple breaks down below the 500 level. Oil continues to rally. Citi and BoA are both taking it on the chin following earnings. 

Odd Block: Some upside love in Brookdale Senior Living (BKD), calls active in Avail Pharmaceuticals, and puts selling in DeVry Inc. (DV).

Xpress Block: Apple earnings have been lighting up the screens of the Idea Hub at OX. A mandatory update on Extend has been released. 

Strategy Block: Uncle Mike discusses getting out of nickel options this week.

Around the Block: Intel earnings in. Big earnings next week: Apple and Netflix on 1/23; AMD and Google on 1/22, Southwest and Microsoft on 1/24.

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