July 26, 2017

It’s All About the VIX…

We experienced what is known as volatility crush today. The investors fear gauge, otherwise known as the VIX lost close to 16%. As an options seller who takes advantage of heightened levels of volatility, today was great...but more importantly, I expect more opportunities ahead. Why? Simply stated, uncertainty. The government shutdown, debt ceiling woes, etc. have finally pushed implied volatility off of historic lows. My hope is that the volatility index can stay above 13, preferably 15. Because we know that a push below 13 makes it very difficult to sell meaningful premium while simultaneously creating a decent margin for error. The higher the VIX, the more premium we can bring in on each and every trade, plus we have the … [Read more...]

Has the Reversal Started?

Important Note to Subscribers: Before I begin I wanted to remind those of you with SPY positions that ex-dividend is on Friday the 15th. It is imperative that if you have any ITM strikes you must take off that position unless you want to be on the hook for the dividend. I will be sending out a trade alert Thursday (possibly tomorrow if SPY moves lower) to remind my subscribers to take the appropriate steps if they indeed have any ITM strikes. The S&P 500 finally took a reprieve today after seven straight days of gains. SPY traded as low as $155.22, but finished the day back up towards the $155.70 level...indeed frustrating for those of us with bear call spreads. But again, it's all about staying the course. And given the current … [Read more...]