Featured Article

  • Unusual Options Activity In Time Warner Cable $TWC

    Unusual Options Activity In Time Warner Cable $TWC

    Unusual Options Activity In Time Warner Cable $TWC As many of you know, unusual options activity can be a valuable indicator as to what traders are thinking, and more importantly, where these stocks are heading in the short-term. This is something professional options traders pay a lot of attention to, and for good reason…  Unusual options activity […]

    Continue Reading

    | April 27, 2015 | 0 Comments

Call Or Put Options?

Buying A Call Option On Facebook $FB

Buying A Call Option On Facebook $FB

Buying A Call Option On Facebook $FB Social media has been something of an enigma to investors.  On one hand, it’s the ultimate growth industry in the age of mobile devices and ever-present Internet connections.  On the other hand, it tends to lack predictable earnings. It’s not unusual for an up and coming industry to […]

Buying A Call Option On JPMorgan Chase $JPM

Buying A Call Option On JPMorgan Chase $JPM

Buying A Call Option On JPMorgan Chase $JPM The financial sector has been one of the more challenging sectors to invest in since the financial crisis of 2008/2009.  The sector itself (especially banks) got hit the hardest during the crash.  And, it’s been one of the slowest to recover from the damage. Additional regulations have […]

Buying A Call Option On Twitter $TWTR

Buying A Call Option On Twitter $TWTR

Buying A Call Option On Twitter $TWTR Social media can be a hard industry to gauge when it comes to making investing decisions.  The companies are relatively new.  And, they use what we tend to consider as non-traditional business models. Moreover, there’s still a lot of consolidation going on in the space.  It’s uncertain who […]

Buying A Put Option on SanDisk $SNDK

Buying A Put Option on SanDisk $SNDK

Buying A Put Option On SanDisk $SNDK When a company sells off sharply, I tend to look for a reason to buy it.  It’s normal for investors to overreact to bad news and cause a stock to be oversold.  Often times, you’ll see a stock which has fallen off a cliff slowly regain ground as […]

Buying A Call Option On MGM Resorts $MGM

Buying A Call Option On MGM Resorts $MGM

Buying A Call Option On MGM Resorts $MGM Sometimes, a company is in need of a drastic change to get back on track.  The thing is, no business can survive indefinitely without occasional change.  Even the biggest businesses in the world have to adjust to meet the times. Apple $AAPL has had to constantly evolve […]

Buying A Call Option On Fossil $FOSL

Buying A Call Option On Fossil $FOSL

Buying A Call Option On Fossil $FOSL The big marketing event of the month so far goes to who else but Apple $AAPL.  The largest company in the world officially launched its highly anticipated Apple Watch at a widely covered conference. $AAPL is making a huge bet on their latest gadget, which is expected to […]

Unusual Options Trading Activity

Unusual Options Activity In Time Warner Cable $TWC

Unusual Options Activity In Time Warner Cable $TWC

Unusual Options Activity In Time Warner Cable $TWC As many of you know, unusual options activity can be a valuable indicator as to what traders are thinking, and more importantly, where these stocks are heading in the short-term. This is something professional options traders pay a lot of attention to, and for good reason…  Unusual options activity […]

Unusual Options Activity In Home Depot $HD

Unusual Options Activity In Home Depot $HD

As many of you know, unusual options activity can be a valuable indicator as to what traders are thinking, and more importantly, where these stocks are heading in the short-term. This is something professional options traders pay a lot of attention to, and for good reason…  Unusual options activity can “tip off” big moves in a stock, […]

Unusual Options Activity In Blackstone $BX

Unusual Options Activity In Blackstone $BX

Unusual Options Activity In Blackstone $BX As many of you know, unusual options activity can be a valuable indicator as to what traders are thinking, and more importantly, where these stocks are heading in the short-term. This is something professional options traders pay a lot of attention to, and for good reason…  Unusual options activity can “tip […]

Unusual Options Activity In Blackberry $BBRY

Unusual Options Activity In Blackberry $BBRY

Unusual Options Activity In Blackberry $BBRY As many of you know, unusual options activity can be a valuable indicator as to what traders are thinking, and more importantly, where these stocks are heading in the short-term. This is something professional options traders pay a lot of attention to, and for good reason…  Unusual options activity can “tip […]

Unusual Options Activity In eBay $EBAY

Unusual Options Activity In eBay $EBAY

Unusual Options Activity In eBay $EBAY As many of you know, unusual options activity can be a valuable indicator as to what traders are thinking, and more importantly, where these stocks are heading in the short-term. This is something professional options traders pay a lot of attention to, and for good reason…  Unusual options activity can “tip […]

Unusual Options Activity In Financial Select Sector SPDR ETF $XLF

Unusual Options Activity In Financial Select Sector SPDR ETF $XLF

Unusual Options Activity In Financial Select Sector SPDR ETF $XLF           As many of you know, unusual options activity can be a valuable indicator as to what traders are thinking, and more importantly, where these stocks are heading in the short-term. This is something professional options traders pay a lot of attention to, […]

Breaking News

What Can We Learn From Options Action In Altera $ALTR?

What Can We Learn From Options Action In Altera $ALTR?

What Can We Learn From Options Action in $ALTR? As regular readers know, I spend a lot of time discussing large and unusual options trades.  Generally speaking, you can gain quite a bit of insight based on what the smart money is doing in options. But what about options activity in general?  Can overall options […]

Big TLT Options Trade Suggests Rates Are Going To Stay Low

Big TLT Options Trade Suggests Rates Are Going To Stay Low

Big TLT Options Trade Suggests Rates Are Going To Stay Low Large and unusual options trades don’t just give us clues on the possible direction of individual equities.  The same theory can be applied on a macro level. For instance, a big options trade in a sector or country ETF may give us valuable information […]

The Best Way To Trade The Energy Sector

The Best Way To Trade The Energy Sector

Crude oil has crashed and it’s taken the entire energy sector with it. The price of a barrel of crude has gone from $105 to $55 in about six months, a 48% decline. That’s officially a crash. Meanwhile, the energy sector has dropped roughly 20% overall during that period. However, the collateral damage has been […]

The Price Of Oil Keeps Plunging… Now What?

The Price Of Oil Keeps Plunging… Now What?

A few weeks ago, I talked about possible oil trading strategies. At the time, oil was down to $75 a barrel, and it seemed cheap. Since then, oil has plummeted all the way to $65 a barrel, and it may even fall to $60 before all is said and done. Back then, my advice was […]

Trading Options Outside The Box

Trading Options Outside The Box

Part of the challenge in making money trading options (or just in the financial markets in general) is the zero-sum game factor. That is, for every winning trade, there’s someone on the other side losing money. The problem is retail traders have to go up against huge trading firms and banks with endless resources. The […]

How The Heck Do You Trade Oil?

How The Heck Do You Trade Oil?

One of the biggest surprises in the financial markets in 2014 has been the collapse of crude oil prices. In mid-June, West Texas Crude was trading at over $105 a barrel. Barely five months later, the price has dropped below $75. Oil hasn’t been this cheap since 2010. The mind-boggling plunge has caught many investors […]

Volatility Watch

Another Interesting, Giant VIX Trade Happened

Another Interesting, Giant VIX Trade Happened

Another Interesting, Giant VIX Trade Happened As an options trader, you should always have a general idea of what’s going on with volatility.  You don’t necessarily have to master the concept.  But, the more you know about the topic, the better off you tend to be. As you know, overall market volatility is most commonly […]

This Unusual VIX Trade Is Worth A Second Look

This Unusual VIX Trade Is Worth A Second Look

This Unusual VIX Trade Is Worth A Second Look As I like to regularly point out, as an option trader, you should always be keeping an eye on what the VIX is doing.  Even if you’re not a volatility trader, the VIX should give you an idea of how cheap or expensive options are on […]

What’s This VXX Trade Telling Us?

What’s This VXX Trade Telling Us?

What’s This VXX Trade Telling Us? There are good reasons why trading iPath S&P 500 VIX Short-Term Futures ETN $VXX is extremely popular.  With an average volume of nearly 50 million shares a day, both retail and institutional traders must be active in this ETN. As a quick refresher, VXX is a way to get […]

Is This UVXY Trade As Important As It Seems?

Is This UVXY Trade As Important As It Seems?

Is This UVXY Trade As Important As It Seems? As regular readers know, volatility levels can give us an idea of overall investor concern.  Is there fear of a selloff or market instability?  Volatility is the best gauge we have of uneasiness. Of course, overall market volatility is most commonly followed by watching the VIX.  […]

How Is The VIX Reacting To The Fed Meeting?

How Is The VIX Reacting To The Fed Meeting?

How Is The VIX Reacting To The Fed Meeting? As an options trader, you can’t understate the importance of volatility.  You don’t necessarily have to master the concept to be a good options trader. But, the more you know about the topic, the better off you tend to be. As you know, overall market volatility […]

This VIX Trade Could Be A Big Deal

This VIX Trade Could Be A Big Deal

This VIX Trade Could Be A Big Deal As an options trader, you can’t understate the importance of volatility.  It’s one of the primary ingredients in the price of an options contract.  Perhaps more importantly, volatility levels can give us an idea of investor concern. Is there fear of a selloff?  Volatility is the best […]

Options Trading Strategies

Using The Option Straddle

Using The Option Straddle

Using The Option Straddle Every earnings season I get questions about what option strategy to use. I hear things like, “What’s the best strategy to use to play earnings?” or “How do I use options to make money on earnings?” With options, there are always several right answers. However, for new traders, I usually recommend […]

Should You Be Trading VXX?

Should You Be Trading VXX?

One of the primary themes I like to discuss on this site is volatility. After all, you shouldn’t be trading options if you don’t at least have a basic understanding of why volatility is important to the financial markets.

Reverse Iron Butterfly Spread

Reverse Iron Butterfly Spread

The reverse iron butterfly spread is a complex, debit spread strategy which benefits from movement in the underlying instrument.  It’s similar in concept to a short butterfly spread, except it’s a debit spread.  A trader profits from a reverse iron butterfly spread when the underlying stock rallies or sells off. A reverse iron butterfly spread […]

Short Condor Spread

Short Condor Spread

The short condor spread is a complex credit spread strategy which benefits from movement in the underlying instrument.  A trader profits from a short condor spread when the underlying stock rallies or sells off. A short condor spread is made up of four options trades at once.  It can be done with either all calls […]

Short Straddle

Short Straddle

A Short Straddle is a neutral options strategy which produces a profit when the underlying stock doesn’t move much up or down.  It’s essentially the opposite of a Long Straddle which profits when the underlying stock makes a big move up or down. So, if you think your stock is going to move sideways for […]

Long Straddle

Long Straddle

A Long Straddle is created by buying both a put and a call with the same terms.  In other words, you buy both a put and a call on the same underlying stock, with the same strike price, and the same expiration date. A straddle purchase allows the buyer to make big potential profits if […]

Options Trading Basics

Making Money With Trend Tracking

Making Money With Trend Tracking

One of the reasons that we created the Option Trading Research tracking system was to identify and track companies that have growth potential.  And to show us where a lot of option buying is coming from.  One such area we used to track before we created this system was companies like the makers of obesity […]

Stock Heading To Zero… What To Do

Stock Heading To Zero… What To Do

Sometimes a stock has been beaten down so much that it seems destined to hit zero. However, even if we are eventually right about the direction, it can be very difficult, if not outright dangerous, to attempt to profit from this type of situation before the company goes bust. Why, what’s the risk? One of […]

A Professional Way To Measure A Stock

A Professional Way To Measure A Stock

Lately I hear a lot of people talking about value investing, but see very few actually practicing it. Here’s the kicker… Once your asset base reaches a certain level, I believe that it’s almost impossible to manage this style effectively. Therefore, I’ve been working diligently to further automate my research process. It seems that yellow […]

No More Vacation For Traders

No More Vacation For Traders

Every man who possibly can should force himself to a holiday of a full month in a year, whether he feels like taking it or not. –William James It seems that the vacation season is having little impact on the market this summer.   I can say this with confidence because the S&P 500 continues to […]

Don’t Think About It Too Much

Don’t Think About It Too Much

“The Gods Must Be Crazy” is a great 1980’s film that contrasts the frenzy of modern existence with the calm of African tribal life.  In one of its very first scenes, a woman turns to the main character and asks, “Does the noise in my head bother you?” The point, of course, is that some […]

Putting Bonds On Warning?

Putting Bonds On Warning?

There’s no question that the market continues a tight tug of war between risk aversion and risk appetite. On one hand, the bulls stress the value of equities and oppose the extreme levels of negativity toward them.  By almost every measure, they’re cheap relative to the alternatives. On the other hand, we’ve all heard the […]