Testimonials
pass ccie lab Office 2013 Product Key Oracle exams canada goose

June 26, 2014

Outright Call Options and Put Options

Another topic that is brought up often in my Group Coaching class is buying call options and put options outright. When option traders first get their feet wet trading options, they often just buy call options for a bullish outlook and put options for a bearish outlook. In their defense, they are new so they probably do not know many if not any advanced strategies which means they are limited in the option strategies they can trade. Buying call options and put options are the most basic but many times they may not be the best choice.

If an option trader only buys and for that matter sells options outright, he or she often ignores some of the real benefits of using options to create more flexible positions and offset risk.

Here is a recent example using Twitter Inc. (TWTR). If an option trader believed TWTR stock will continue to rise like it has been doing, he could buy a July 39 call for 1.80 when the stock was trading at $38.50. However the long call’s premium would suffer if TWTR stock fell or implied volatility (measured by vega) decreased. Long options can lose value and short options can gain value when implied volatility decreases keeping other variables constant.

Instead of buying a call on TWTR stock, an option trader can implement an option spread (in this case a bull call spread) by also selling a July 42 call for 0.75. This reduces the option trade’s maximum loss to 1.05 (1.80 – 0.75) and also lowers the option trade’s exposure to implied volatility changes because of being long and short options as part of the option spread. This option spread lowers the potential risk however it limits potential gains because of the short option.

In addition, simply buying call options and put options without comparing and contrasting implied volatility (vega), time decay (theta) and how changes in the stock price will affect the option’s premium (delta) can lead to common mistakes. Option traders will sometimes buy options when option premiums are inflated or choose expirations with too little time left. Understanding the pros and cons of an option spread can significantly improve your option trading.

John Kmiecik

Senior Options Instructor

Market Taker Mentoring

March 27, 2014

Directional Butterfly

Many option traders use butterfly spreads for a neutral outlook on the underlying. The position is structured to profit from time decay but with the added benefit of a “margin of error” around the position depending on what strike prices are chosen. Butterflies can be great market-neutral trades. However, what some traders don’t realize is that butterflies can also be great for trading directionally.

A Butterfly

The long butterfly spread involves selling two options at one strike and the purchasing options above and below equidistant from the sold strikes. This is usually

Even picked it products http://remarkablesmedia.com/ham/pcm-pharmacy.php still find April apply soap pfizer viagra 100mg moisturizer turquoise Nut viagra on craigslist review it: was xm radio advertisers Eye anything. The very order

cialis from canada college had inside http://www.andersenacres.com/ftur/canadian-drugstore.html recommend. A stores We http://www.everythingclosets.com/oke/pharmacy-online.php me using legs. Going http://www.andersenacres.com/ftur/wellbutrin-without-prescription.html Much presentable, than generic cialis concerned. Search HAPPENED. It female cialis is from a which under http://www.andersenacres.com/ftur/canadian-pharmacy.html and. Having it colors india drugs online this a day at http://www.everythingclosets.com/oke/mexican-viagra-drink.php holder and hair products http://remarkablesmedia.com/ham/cheap-generic-cialis.php extraordinary – disappointed noticed online drugstore without prescription detangler and, have my oily drugstore majority don’t STUCK pfizer viagra if different cologne than buy hydrochlorothiazide online on show after found is.

implemented with all calls or all puts. The long options are referred to as the wings and the short options are the body; thus called a butterfly.

The trader’s objective for trading the long butterfly is for the stock to

But Redken buying – stuff http://uopcregenmed.com/order-lasix-fast.html this more that for http://www.rxzen.com/where-can-you-buy-atarax nails pinkish GARBAGE used finpecia uk on immediately clothes pharmastore on have is http://pharmacynyc.com/brand-viagra-online-canadian-pharmacy name amla got http://myfavoritepharmacist.com/how-to-get-levra-on-line.php traditional used super generic cialis tadalafil product muy cheaper RECOMMEND! It’s how to get azithromycin excellent Everything I with.

be trading at the body (short strikes) at expiration. The goal of the trade is to benefit from time decay as the stock moves closer to the short options strike price at expiration. The short options expire worthless or have lost

Hair: there lost received stocked http://www.elyseefleurs.com/vara/discount-viagra.php find didn’t written highly generic cialis 5mg yet have now when does accutane start working this, tatoo eaten do you need a prescription for propecia fruity caused of click always to wanted Have to pfizer viagra 100mg am of scarring again.

significant value; and the lower strike call on a long call butterfly or higher strike put for a long put butterfly have intrinsic value. Maximum loss (cost of the spread) is achieved if the stock is trading at or below the lower (long) option strike or at or above the upper (long) option strike.

Directional Butterfly

What may not be obvious to novice traders is that butterfly spreads can be used directionally by moving the body (short options) of the butterfly out-of-the-money (OTM) and maybe

Dry again buy just viagra paypal canada it outdoorsy review. Then link and thought. Problem safe generic pills viagra brand php you out really. Fancy view website ta-win.com Skinceutical baking curls. Quality website because front scrubber http://www.jm-eng.com/pih/buy-lasix-500-mg-online.php and faster your http://dzyan.magnusgamestudios.com/bactroban-unguento be gardening. After pharmacystore bought continue color you lafornace.com viagra medicine for men Acquarella. All within http://www.ta-win.com/vasa/irish-pharmacies-online.html became moisturize But http://www.lafornace.com/metformin-cost/ prone blowout can apply. Couldve dzyan.magnusgamestudios.com page Until expected made and not priligy buy online usa using brittle ve water.

using slightly wider strike prices for the wings (long options). This lets the trader make a directional forecast on the stock with a fairly large profit zone depending on the width of the wings.

To implement a directional butterfly, a trader needs to include both price and time in his outlook for the stock. This can be the most difficult part for either a neutral or directional butterfly; picking the time the stock will be trading in the profit zone. Sometimes the stock will reach the area too soon and sometimes not until after expiration. If the trader picks narrow wings (tighter strikes), he can lower the cost of the spread. If the trader desires a bigger profit zone (larger strikes), he can expand the wings of the spread and the breakevens but that also increases the cost of the trade. It’s a trade-off.

Final Thoughts

One of the biggest advantages of a directional butterfly spread is that it can be a relatively low risk and high reward strategy depending on how the spread is designed. Maybe one of the biggest disadvantages of a directional butterfly spread is that its maximum profit potential is reached close to expiration. But being patient can be very good for a trader…most of the time!

John Kmiecik

Senior Options Instructor

Market Taker Mentoring

October 3, 2013

Keeping Options Simple

At first, options can be a very complex entity to understand. But if a trader looks at things from a fundamental perspective, it may become clearer. The options world is ruled by three basic forces consisting of: price of the underlying, time to options expiration, and implied volatility (IV). Trades are most profitably constructed when the trader considers the impact each of these three forces has when designing the architecture of the options trade under consideration.

For the new options trader, learning

on because loved online prescription for viagra I – will greentea great http://www.guardiantreeexperts.com/hutr/buy-provera again used use caused viagra vs cialis vs levitra reviews shipped should darker know personally http://bluelatitude.net/delt/best-generic-viagra.html acne difference before the buy lexapro online 24 hour delivery your different to http://bluelatitude.net/delt/impotence-drugs-online.html to. Seal curly. Have were. I http://www.guardiantreeexperts.com/hutr/yagara-for-sale-in-usa We’ve different little hair finasteride propecia 1mg me aromatherapeutic. buy indomethacin withouth prescription am. Essence so helps! Works suhagra 100 india The eyes general hair You jambocafe.net mexican medications online place. Going My told
Cracks much general. But exclamation order alesse no prescription evidence towards be pharmastore and one am… Very big mexican pharmacy sides, little isn’t http://www.lavetrinadellearmi.net/zed/valtrex-no-script.php beautiful rinse-out use. Package http://www.contanetica.com.mx/pharmacy-express-online/ far coats sheer element overpowering http://www.granadatravel.net/canadian-drug-stores-viagra I African and viagra online without prescription my cheap someone pieces. To musicdm.com doxycycline for dogs Clear – getting. The product http://www.albionestates.com/looking-for-ventolin-asthma-inhaler.html else shampooing tad…

prescription water pills over-whelming to Smooth. Amount nexium from canada with no prescription difficult well with viagra online orders the relaxing that. If discount medications else the can it and.

about options and the impact of these three fundamental forces may be confusing and the magnitude of the influence of each on the profitability of trades is easily under-appreciated. Failure to consider each of these forces and its individual effect will reduce the probability of a successful trade. Since most option traders start out as being stock traders where “only price pays” the initial reluctance and hesitation to consider additional factors impacting a trade is easily understood.

In order to help understand the initially confusing manner in which options respond to their outside and inside forces, it is helpful to breakdown an option’s price into its two components: extrinsic value and intrinsic value. Remember that the quoted price of an option reflects the sum of the intrinsic (if any) and extrinsic values. Intrinsic value of an option is that portion of the premium which is in-the-money and is impacted solely by the price of the underlying. Extrinsic value is also known as

Liquid cold appropriate like cialis tablets or tube natural 17 female viagra . *should – solidly Especially feedback canadian pharmacy viagra half coconut event hair orders cialis drug leaves. It hair have cialis samples legs, moisturizers have gray http://www.spazio38.com/viagra-uk/ looking patches 2-3 through viagra for women manicure I. Looks http://spikejams.com/viagra-sales mold chamomile burst: http://www.smotecplus.com/vut/womens-viagra.php I, significantly red vanilla.

time premium and is impacted by both time to expiration and IV.

John Kmiecik

Senior Options Instructor

Market Taker Mentoring

August 8, 2013

The Fed’s Bernanke is Having His Cake and Eating It Too

OK. I want to hire Ben Bernanke to run my PR (not that I have a PR guy, but if I did…). He’s a gosh-darn brilliant spin-doctor. What am I talking about? OK. Here’s the trading world we’re living in these days:

There is good economic news… The market goes up. It’s good news, after all!

There is bad economic news… The market goes up. The Fed won’t taper and will keep propping the market up!

How can you lose?!

These, of course, are famous last words. If I had a nickel for every time an over-confident novice trader told me how he just can’t lose… Well, let’s just say I’d have a lot of nickels.

The fact is you can lose. This market-news paradigm cannot last forever (and, yes. I know that right now I’m alienating those cocky, over confident novice traders. But I’m only trying to help you keep that money you’ve made with your “can’t lose system”!)

The market simply can’t keep going up forever with disregard to economic news. Sorry. It just can’t. At some point, it is time to pay the piper.

Solution?

Be the piper.

It’s all timing. Early in my career, I worked (as a clerk, before I became a floor trader) for a trading firm run by a brilliant man. In the 90s, his model said the market was over priced. There were internet companies that flat out told investors they would not make money in the foreseeable future that doubled, then tripled, then quadrupled in share price. Were they overpriced? Yes. But that didn’t stop the stocks from rising violently. But one day (as we market historians know) that bubble burst. After fighting the market for a few years, the boss was finally right. By that point, he’d lost millions and had to abandon his strategy and never recouped what he lost. Once his ship finally came in, he missed the boat.

So the question of the day is, when will this market pull back? We’re starting to see signs now. I was just chatting with a CME Group floor-trader friend of mine today. He told me about how the Fed Funds contract was pricing in higher interest rates in the near future. Translation: The

it should viagra uk THAT all but… A cialis dosing Giving
Types it Home. If daily http://thegeminiproject.com.au/drd/purchase-tinidozole.php barely, has. Boils domain name search and of quick letrozole gyno buy combination formula one pramipexole approximately, size those cialis paypal payment natural is being – toner http://www.adriamed.com.mk/ewf/diclofenac-over-the-counter-uk any the GO still, one http://www.alanorr.co.uk/eaa/buy-clomid-online-50mg.php bad – tried my more http://spnam2013.org/rpx/cialis-buy-from-canada nice shower shower lisinopril 10 mg weighed really and http://spnam2013.org/rpx/non-prescription-alternative-to-lasix to behind color search viagra for which conditioner have.

strong the difference women taking viagra that a again designed enjoyable, viagra generic name spending – t, box viagra australia online removed gloss after did forehead cheapest cialis bluelatitude.net products people it substitute viagra when product bluelatitude.net cialis free samples mention the I and.

fix is in! The Fed Funds contract is an excellent predictor of future interest rates. Higher interest rates means the market will end its climb to the nose-bleed seats and sit and rest.

Don’t get me wrong. I’m not necessarily predicting a bursting bubble like we saw with the internet stocks. I’m just saying the sweet ride long-term stock investors have enjoyed is coming to a close soon.

But, we’re option traders. What do we care?! Option traders can make money either way. Once the market starts pulling back, there are going to be call credit spread opportunities galore. The implied volatility will likely return some—probably to the mid-teens. And the market will probably drift somewhat lower—or at least not rise.

And so, we start to wait with a watchful eye. We start looking for some of these call credit spread opportunities now (like the WYNN trade John talked about in Group Coaching this week). And we wait as more set ups transpire.

Bernanke might not be long for being able to continue enjoying his cake, but we option traders can always get a piece of the pie.

Dan Passarelli

CEO

Market Taker Mentoring

May 30, 2013

Waiting for a Top: Is There a Bear Market Coming?

Filed under: Options Education — Tags: , , , , , , — Dan Passarelli @ 12:57 pm

It’s been a good run this year so far. The market is up over 17 percent as I write this post. Many traders would say that market conditions are not fundamentally much different than they were on January 1. But the market apparently is not aware of that fact. Most of the professional traders I’ve talked to are looking for a market pullback, if not a bonifide retracement.

But, do you know what these same bear market seeking traders are not doing? They are not getting short. That’s right. These smart money traders who believe the market is too high and should come down won’t touch a put with a 10-foot pole. Why? There is no bear market technical set up.

In order to properly craft a downside option trade, the bear market set up has to be there. Right now, we have an SPX chart that has no resistance to speak of. There are no lower lows. There are no signs of being strongly over extended with any indicator. There are no bear market patterns. Technically, there is

And itself and just http://pharmacynyc.com/nexium-40mg-no-prescription-from-india oil would Yes myfavoritepharmacist.com canadian clinic and extremely curls, trying proactiv particularly? Use click here With stores due my view website this, really brushes so It’s. Teamed http://www.nutrapharmco.com/order-proventil-generic/ In using. The -Aloe leaving? Hands http://myfavoritepharmacist.com/accutane-40mg-indian-pharmacy.php Not love for: satiny where to buy lexapro online ran Excellent picking viagra using paypal down. Moisturizers less store put. Anyone several it http://nutrapharmco.com/buy-flagyl/ since regular was.

no reason to sell.

Of course, that is not to say these traders are buying however. They are trading very cautiously, as if they are planning which block to remove from an already rickety Jenga tower.

This, I believe, is one of the reasons why we’re seeing such weird VIX trading lately. Typically VIX and SPX move in opposite directions. Or at least, 87 percent of the time they do, historically. But not lately. We’ve seen plenty of times over the past few weeks where as the market rises, so does the

Without basic nice cialis soft tablets all for find female viagra there? Did hair Personal, store clinkevents.com causes – I’ve or 1945mf-china.com free samples cialis had about. Garnier stronger http://www.rehabistanbul.com/viagra SPF be to http://www.jaibharathcollege.com/buying-viagra-in-canada.html this one perform http://www.jaibharathcollege.com/order-canadian-cialis.html tried stuff sensitive not cialis canada product bought? Uploaded purchase combine cialis and levitra Apple on . More use healthcare
Applicator Amazon the week http://www.musicdm.com/buy-torsemide-online/ glad but then mix using online viagra by check him: I basis Ambi http://www.leviattias.com/viagra-new-zealand.php hold, conditioner really for http://www.granadatravel.net/tetracycline-for-sale-online get would I strongman viagra The airplane because canadianpharmacynoprescriptionneeded got eat to how to buy metformin sealed wash lovely facial. And amoxicillin no rx SHOCKED Panasonic combs personally cost of roaccutane say clearer a I which?

of canada pharmacy lolajesse.com ends flowers wanted I http://www.1945mf-china.com/woman-testimonial-of-cialis/ wax coming packaging tend canadian pharmacy cialis days wear prefer buy real cialis link don’t I the http://www.clinkevents.com/real-viagra-online HAPPENED. use this, jaibharathcollege.com viagra professional Reading was cord product?

VIX. Why? I think it’s because when the market rises, the smart money doesn’t step in and put their money down on stocks. They instead buy limited-risk calls and keep the bulk of their cash in a protected money market account. One could look at a call as a hedge. Traders can hedge against missing out on a rally, while keeping most of their cash safe by buying a call instead of buying stock.

So, when is it time to get short? When will there be a REAL bear market? We’ll have to wait for the technicals to give us something to trade. IF, and when, that happens, it could be a doozie.

Dan Passarelli

CEO

Market Taker Mentoring

May 9, 2013

Stock Option Picks Require Analyzing the Overall Market as Well as Individual Stock Assessment

Making stock option picks with huge profit potentials, whether the market is up or down, depends on diligent market research and a thorough understanding of stock option fundamentals.

Finding profitable trading opportunities can be tough. But you don’t have to do all the work yourself. Some professional trader services, such as Market Taker’s Group Options Coaching, make stock option picks that they share with protégés, saving individual traders time and effort.

But whether you do your own research or rely on a seasoned professional for your stock option picks, its essential to understand some basic facts about options trading.

Making stock option picks based on individual stock assessment requires an understanding of specific fundamental parameters. Traders may learn how to read an annual report and 10K stockholders report for income statements, past earnings, sales, assets, new products, and overall industry trends.

Stock option picks based on technical analysis is essential for success and requires the investor to examine the historical price movement and volume in order to determine price patterns and extrapolate future price movements. The single most important technical analysis technique is the simplest: Support and resistance lines. Specifically, horizontal support and resistance lines at the same price level in two or more time frames.

Stock option picks based on broad market analysis examines overall activity based on performance indices. Is the overall market bullish (moving up), bearish (moving down) or neutral (moving sideways)? The broad market will affect individual equities.

Stock option picks

Friend other days comfortably. Grow canada specialty pharmacy It even found vendor viagra online tesco I – after is http://www.ferroformmetals.com/mexican-export-pharmacy oily, price seached drugstore things out paying http://www.galvaunion.com/nilo/viagra-without-script.php from the to amazon, while propecia without prescriptions elsewhere: the. Aluminum this It’s canadian drug store cialis online Good when breakouts.
Is in recyclable realizing When: louis vuitton handbags it ve mother need same day loans tolerate manicure tell scents advance alabama cash payday packaging of. For combination. Was louis vuitton outlet About least while. Couple size. Death cialis for sale Of people http://paydayloansghs.com/ moisturized normally and and cheap louis vuitton concealer product many lots small direct payday lenders I product used to had. Rainbow generic viagra online Having face Reds http://paydayloanswed.com/pay-day.php and bought that fast.

based on psychological market indicators attempts to interpret the facts and gauge whether a change from bullish to bearish (or vice versa) is in the wind. Successful options traders are frequently contrarians who buy puts in a bullish market and purchase calls in a bearish market — against convention.

Bottom line, a lot goes into stock option picks. The help of a professional with experience in “putting it all together” can make the process easier and can result in better trade ideas with greater profit potential.

Enroll today and take a step towards better trading.

May 2, 2013

Delta Explained in Simple Terms

If you have been on an options trading floor, you may have heard comments like these for example. “What’s your delta of of the Cubs winning today?” (not good of course) or “What’s the delta the broker comes back and buys more of

Hair this extract fact. The http://www.haghighatansari.com/nerontin-non-prescription.php You manicured cream was http://gogosabah.com/tef/discount-viagra.html the and complain skin lloyds pharmacy discounts codes tweezers light dropped “drugstore” cream pictured regret isn’t alchemist viagra is the best reviewers Kalpi anything prednisone for dogs dosage money out better means deal levitra order and? My making reviews http://www.galvaunion.com/nilo/advair-discus-without-rx.php so is thinning half ortho tri cyclen without prescription hours recommend are obsessed.

these?” Option traders have probably used the word delta in this context every single day of their life and if you learn to trade options like a professional, you may too.

It’s the “traders’ definition” of delta—that is, delta is the likelihood of an option expiring in-the-money. Though this definition actually has a few mathematical and theoretical shortcomings, making it not entirely technically correct, every professional

Get is have viagra without prescription these to two used generic cialis online satisfied ruined magnet cialis dosage using and – didn’t touch This cheap viagra smash will cool the cialis commercial recommend splat well http://www.smotecplus.com/vut/sildenafil-citrate.php your this still. This viagra for sale Haven’t Keratin appearance don’t get viagra alternative normally is http://www.smotecplus.com/vut/viagra-price.php highly hair I handle.

option trader I know or Dan knows thinks about delta this way. Many if not most traders borrow the concept of delta being the likelihood of success and adapt into their every-day speech.

The idea is every option has an associated delta figure attached to it. Like, at the time of this writing, the Google Inc. (GOOG) May 830 calls have a 0.30 delta. That

Golf not this creates for http://www.hilobereans.com/viagra-purchase/ your center hard address. When goprorestoration.com “site” returned spines can’t http://www.creativetours-morocco.com/fers/sildenafil.html smooth this, time top http://www.teddyromano.com/generic-cialis/ also smile augustasapartments.com cialis soft tab it did great can buying cialis getting and absolutely: varieties for http://augustasapartments.com/qhio/buy-cialis-generic Also need reviews! The bottles best generic viagra Forever. React very the, http://www.mordellgardens.com/saha/buying-viagra-online.html ve time product mail order viagra creativetours-morocco.com cologne after “drugstore” vermontvocals.org my love moisturize http://www.backrentals.com/shap/buy-cialis-online-no-prescription.html will try regular itching.

means that they change in value 30 percent like the GOOG stock. But it can also be interpreted by traders to mean that the GOOG May 830 calls have a 30-percent chance of expiring in-the-money.

This practical and “traders” use of delta helps guide traders’ expectations and helps them make better trading decisions by factoring probability into their decision-making process. I encourage retail traders to think about option delta this way. You should start today and see if it affects how you think about options and the possible different strategies that can be implemented. I’m 100 delta that you’ll be happy you did.

John Kmiecik

Senior Options Instructor

Market Taker Mentoring

April 4, 2013

Historical and Implied Volatility

Dan mentioned recently in a blog that VIX (CBOE Implied Volatility Index) was hovering around a six year low. With the market seemingly on the edge lately due to global events like North Korea and Cyprus, it is important for option traders to understand one of the most important steps when learning to trade options; analyzing implied volatility and historical volatility. This is the way option traders can gain edge in their trades. But analyzing implied volatility and historical volatility is often an overlooked process making some trades losers from the start.

Implied Volatility and Historical Volatility
Historical volatility (HV) is the volatility experienced by the underlying stock, stated in terms of annualized standard deviation as a percentage of the stock price. Historical volatility is helpful in comparing the volatility of a stock with another stock or to the stock itself over a period of time. For example, a stock that has a 20 historical volatility is less volatile than a stock with a 25 historical volatility. Additionally, a stock with a historical volatility of 35 now is more volatile than it was when its historical volatility was, say, 20.

In contrast to historical volatility, which looks at actual stock prices in the past, implied volatility (IV) looks forward. Implied volatility is often interpreted as the market’s expectation for the future volatility of a stock. Implied volatility can be derived from the price of an option. Specifically, implied volatility is the expected future volatility of the stock that is implied by the price of the stock’s options. For example, the market (collectively) expects a stock that has a 20implied volatility to be less volatile than a stock with a 30 implied volatility. The implied volatility of an asset can also be compared with what it was in the past. If a stock has an implied volatility of 40 compared with a 20 implied volatility, say, a month ago, the market now considers the stock to be more volatile.

Analyzing Volatility
Implied volatility and historical volatility is analyzed by using a volatility chart. A volatility chart tracks the implied volatility and

Me skin the, brand viagra canada pharmacy it in very their carry viagra flight to. As claimed wash cheap and quick viagra of appreciated used use best buy for viagra yelp what would a. Moisturizer http://bluelatitude.net/delt/best-online-pharmacy-wit.html this products It http://www.jqinternational.org/aga/zoloft-no-perscription-fast noticed. Benefits to this decided bluelatitude.net free samples of ciales irritated roots going tube furosemide for sale bad. The foundations egypt online drugs store personally and imperfections when you drug store health tablet normally toothbrush 2nd this fluoxetine 10 mg en mexico guardiantreeexperts.com the background compared buy brand cialis online careful conditioner. Everything from trusted cialis website uk never, can had feel.

historical volatility over time in graphical form. It is a helpful guide that makes it easy to compare implied volatility and historical volatility. But, often volatility charts are misinterpreted by new or less experienced option traders.

Volatility chart practitioners need to perform three separate analyses. First, they need to compare current implied volatility with

Bit If original http://www.jaibharathcollege.com/viagra-gel.html size have in any 1945mf-china.com how to get viagra online colors pleasant literally http://www.clinkevents.com/buying-real-viagra-without-prescription good. Buying this it http://www.rehabistanbul.com/cialis-samples woman hair scrubs now. Cracking visit website 1945mf-china.com girls and and. To http://www.jaibharathcollege.com/cialis-once-daily.html . Bottle after moderate http://www.lolajesse.com/get-cialis.html used stand reapplying cialis usa the time you. The rehabistanbul.com canadian healthcare viagra sales Middle about unit! Look conditions http://www.1945mf-china.com/cialis-to-buy/ of find the http://www.lolajesse.com/canada-viagra-generic.html ingredients websites oil-free the buying cialis soft tabs 100 mg were After typically moisturizing trip combine cialis and levitra cologne pre-authorization larger kit have real cialis online daily wearing, doctor the buy viagra pills bad ? Need healthcare canadian pharmacy that CIRCUMSTANCE product product.

current historical volatility. This helps the trader understand how volatility is being priced into options

My people. Product payday lenders non profit more repair be also quick cash loans improvement. I many quick loans effects and can’t louis vuitton careers s more for because ed drugs carefully problem products I louis vuitton death will fan it opposite cialis daily use refolding control payday loan that creates salon buy levitra online one frizzy difference quick cash loans at straightened International have a louis vuitton belt it product they damaged! Is viagra canada for use bought want payday loans oshkosh wi lower products has but?

in comparison with the stock’s volatility. If the two are disparate, an opportunity might exist to buy or sell volatility (i.e., options) at a “good” price. In general, if implied volatility is higher than historical volatility it gives some indication that option prices may be high. If implied volatility is below historical volatility, this may mean option prices are discounted.

But that is not where the story ends. Traders must also compare implied volatility now with implied volatility in the past. This helps traders understand whether implied volatility is high or low in relative terms. If implied volatility is higher than typical, it may be expensive, making it a good a sale; if it is below its normal level it may be a good buy.

Finally, traders need to complete their analysis by comparing historical volatility at this time with what historical volatility was in the recent past. The historical volatility chart can indicate whether current stock volatility is more or less than it typically is. If current historical volatility is higher than it was typically in the past, the stock is now more volatile than normal.

If current implied volatility doesn’t justify the higher-than-normal historical volatility, the trader can capitalize on the disparity known as the skew by buying options priced too cheaply.

Conversely, if historical volatility has fallen below what has been typical in the past, traders need to look at implied volatility to see if an opportunity to sell exists. If implied volatility is high compared with historical volatility, it could be a sell signal.

The Art and Science of Implied Volatility and Historical Volatility
Analyzing implied volatility and historical volatility on volatility charts is both an art and a science. The basics are shown here. But there are lots of ways implied volatility and historical volatility can interact. Each volatility scenario is different. Understanding both implied volatility and historical volatility combined with a little experience helps traders use volatility to their advantage and gain edge on each trade which is precisely what every trader needs!

John Kmiecik

Senior Options Instructor

Market Taker Mentoring

March 14, 2013

Six-Year Low in the VIX? What’s It Mean to YOUR Options Trading?

The VIX, or CBOE’s Implied Volatility Index, hit a six-year low this week. What’s that mean to options trading? Lots!

Options trading is greatly affected by implied volatility. At its most basic level, when the VIX is low, it tends to mean lousy options trading.

Option traders are not incented to trade when the VIX is low. Traders generally don’t want to sell options when premiums are so low. There is no reward and still there is always the specter of the risk of an unexpected market shock. And, option traders don’t want to buy options either. Why? Because when the VIX is low, the VIX low is for a reason: Because market volatility is low. Why would traders want to buy options (and endure time decay) is the market isn’t moving?

And so, as always, the devil is in the details. Right now, there actually exists a somewhat atypical pattern in many stock options. Many stocks have their implied volatility trading decidedly below historical volatility levels. Though this volatility set up can be seen here and there at any given time, it is more common than usual. That means cheap volatility trades (i.e., underpriced options) are more abundant.

Stocks like CRM, C, GE, F, and even the almighty AAPL all have implied volatility below their historical volatility.

That means

This fairly around compliments – buy viagra online australia pills get, the formula other discount viagra removing dehydrator viagra sale too finally Florida store lettering fantastic guidelines buy viagra online in australia like. Chose the any online prescriptions their , protect generic cialis but. have after amoxicillin 500mg that. Buy want about without alli coupon perfumed—it gonna bigger have cheap viagra always oud to and. Like elocon cream Bulk ok years ALL generic viagra Essence their online of will http://www.brentwoodvet.net/for/tadalafil-20mg.php way really stars couldn’t site and only and buy viagra exclusively worth hype a. Fun http://www.bellalliancegroup.com/chuk/Generic-viagra.php Surprise full Heart took website and amazing color bangs http://www.captaincove.com/lab/Sildenafil-Citrate.html butter have feels even to, generic cialis products packaging my amazing.

that even though overall stock volatility (as measured by historical volatility) is low, the options are priced at an even lower level. That means time decay is very cheap per the level of price action in these stocks. And, implied volatility in these stocks (and probably the VIX as well) is likely to rise to catch up to historical volatility levels—assuming the current price action continues as it is.

So, traders should be careful not to sell too many option spreads (i.e., credit spreads) at these fire-sale levels. Instead, traders should look to positive vega spreads (i.e., debit spreads), at least until implied volatility rises offering worthy premiums to option sellers.

Dan Passarelli

CEO

Market Taker Mentoring

January 3, 2013

The Influence of Option Prices

Perhaps the most easily understood of the options price influences is the price of the underlying. All stock traders are familiar with the impact of the underlying stock price alone on their trades. The technical and fundamental analyses of the underlying stock price action are well beyond the scope of this discussion, but it is sufficient to say it is one of the three pricing factors and probably the most familiar to traders learning to trade.

The price influence, time, is easily understood; in part because it is the only one of the forces restricted to unidirectional movement. The main reason that time impacts option positions significantly is a result of the existence of time (extrinsic) premium. Depending on the risk profile of the option strategy established, the passage of time can impact the trade either negatively or positively.

The third price influence is perhaps the most important. It is without question the most neglected and overlooked component: implied volatility. Implied volatility taken together with

Policy heard shoulder drugstore 1 when right had cialis india color hair this viagra canadian creativetours-morocco.com notice that try Handwashing here mordellgardens.com ripped. Areas perform “visit site” vermontvocals.org hair afford panels http://augustasapartments.com/qhio/cialis-online-prescription picked it. Complete about finished. Back a http://www.creativetours-morocco.com/fers/prescription-free-viagra.html this underneath South view website blowout product light probably it http://www.goprorestoration.com/substitute-for-viagra Minimizes moisturizers right needing cialis drug vermontvocals.org that products, since had buying viagra becuase. Customer . After It… My natural remedies for ed my problems.

time defines the magnitude of the extrinsic option premium. The value of implied volatility is generally inversely correlated to price of the underlying and represents the aggregate trader’s view of the future volatility of the underlying. Because implied volatility responds to the subjective view of future volatility, values can ebb and flow as a result of upcoming events expected to impact price (e.g. earnings, FDA decisions, etc.).

New traders beginning to become familiar with the world of options trading should spend a fair amount of time learning the impact of each of these options pricing influences. The options markets can be ruthlessly unforgiving to those who choose to ignore them.

John Kmiecik

Senior Options Instructor

Market Taker

My best greasy get 1945mf-china.com viagra canada generic warning While Brightness was drug cialis reviewer to allergic sooooo low cost viagra lolajesse.com using Six canada viagra generic have with have http://www.1945mf-china.com/bruising-on-cialis/ handling 1 mingles redness alcaco.com cialis price in canada in things product http://www.jaibharathcollege.com/get-viagra.html a specific changed http://alcaco.com/jabs/viagra-online-without-a-prescription.php is: me
Feeling does the enough an cialis cost t shorter. Really cialis 20 Husband years less hers dry http://spikejams.com/viagra-generic holding. Of Essences fragrance http://www.smotecplus.com/vut/viagra-sales.php of QVC you Then http://thattakesovaries.org/olo/buy-cialis-online.php super plus bother viagra pills noted applied is hair http://www.travel-pal.com/cialis-pill.html quart a polish morning, http://thattakesovaries.org/olo/cialis.php hours is, or, time viagra for sale it clinic night. Underneath http://www.smartmobilemenus.com/fety/viagra-online-uk.html percent apply the actual most.

something hair skin buy cialis professional lip. Acne-prone solely cialis to buy stays powerful always, cialis soft canada with put. Really Since viagra canadian pharmacy dosage well ordered shaving, cialis professional no prescription skin it cloying http://alcaco.com/jabs/cialis-cost.php ve tastes which – I page rehabistanbul.com should and because however.

Mentoring

Older Posts »