Welcome to OptionsPlay! My name is Tony Zhang and I am the Chief Strategist at OptionsPlay. We show investors of all experience levels smart ways to trade options and generate income. Discover how options can unlock investment opportunities for everyone!
13:20 than you for acknowledging the sentiment. The fear in this bull market is palpable & everyone is holding their breath for a black swan -except that BLS & official sources painting a rosy picture & outlets like Yahoo! Finance gaslighting us that this economic house of cards propped up by 6 big companies is “stronger than ever.” The consumer would beg to differ & smart investors know the whole thing is running on fumes. Thank you for your honest perspective.
It means that if the stock moves 2 standard deviations in either direction the loss on the straddle should not exceed roughly 2% of your total portfolio. So for example if you’re have a portfolio of $100k, the 2SD move in a stock should equate to about a $2k loss in your portfolio. If it is larger than $2k then you need to sell fewer contracts or sell straddles on a lower priced stock.
Great presentation, but something seems off in the table of Credit Spreads shown between 27´-29´. You estimate a 3:1 risk/reward, which would mean a 75% success rate only makes you break even, but then you are selling 40 Deltas, which statistically indicates a 60% chance of profit. With no other variables in play, this would seem like a losing strategy over hundreds of trades?? Please clarify.
*Timestamps:* A. Intro/Background | B. Mkt Envrnmnt Oddities | C. Fav Strategy w/ Entry/Exit Procedure 04:10 *Tom's Intro:* mkt maker, ToS + TastyTrade, software & content dev; Aside: 06:00 Brian at OptionsPlanet split education from brokerage 07:28 *Brian's Intro:* options educator 09:15 *Industry changes:* 75% of brokerage transactions are derivatives, not stocks = importance of capital efficiency; trading groups (options traders want conversations) 12:25 *B. Market outlook:* new all-time highs w/ unusually high protection w/ VIX above 20 (vs mid teens normally) 16:40 *Upcoming election:* //Brian// mkt waiting for speed bumps to be cleared then bullish 18:50 *C. Fav Strategy w/ Entry/Exit:* *Tom:* 75%:25% undefined risk:defined risk trades; 100 trades/day, as mostly high-volatility (high IVR), short strangles just outside expected move (45 DTE, 20 Delta); various underlyings (stocks, etfs, futures) but not VIX, biotechs; small bet size with diverse holdings; trades smaller, more frequently, direction-ambivalent. Mgmt: by 21DTE (by 1/2way to exprtn) or 50% profit target. 31:30 *Brian:* trades high volatility underlyings w/ directional bias. 32:40 *skip-strike butterfly:* embedded call-spread that pays for butterfly--more credit builds safety buffer; long spread wider than short spread (if VIX upspikes, you're safe). Adjustments: long spread to butterfly to short spread. 35:45 *Why Sept/Oct bearish seasonality:* Apr/May is worse; //Brian's adjustments: shorter term 5-18d (VIX monthly exprtn on ea 3rd Wed ); 41:00 *Brian's mgmt:* ex. bearish put butterfly, mkt goes against (up), sell most expensive contract and roll to least costly contract to follow trend, net credit to acct, follow with trend. 43:45 *Tom's trading example screenshare:* TSLA, NVDA are most traded stocks; huge liquidity, high volume, high IV (70% = avg daily move of 3.5%), expected move (above avg); binary event (high premium); pricing skew to upside vs downside; delta neutral trade w/ 2 different strangles; CVAR shows worst-case 5% risk; high PoP (82%). 53:00 *example for small $50k acct:* 54:50 *efficient pricing of options:* risk:reward = Prob of Profit 57:55 *Close out call to action*
Tony, why dont you get a decent microphone? It always sounds like you using an old Radio Shack model. Either youre mike is bad or maybe youre phoning it in from Indonesia.
Amazing video, thanks guys! I am 1 year into options have been learning from Tom and crew the whole time. I’ve been going hard on the 45/21 strangles and great to hear it all summarized like this.
The team or Tasty Have changed the way be looking at Trading. scalping a $100 here or there on stocks is not the easy money anymore. A good Sell put Portfolio is much more efficent than that.
@@Roscoe0494 if that's the case no one should be speaking so vehemently against it, with certainty that there's "45% capital gains tax" and "20% unrealized profit tax". Right?
do anyone lose money on butterfly? b/c looks like max profit is good and max loss is much less....too good to be true? Can you please discuss the risk?
This is nice but lacking one important thing timing - what expiration you pick, when do you role, if market goes up or down, or just time passes and option get decay. If you a put spread timing becomes more important as those spreads gets their value only close to the end and don't enjoy the IV increase on the down move, making the structure you show very good just for very short term hedging. if one need to hedge every week with this structure this might work well, was this your intention? ignoring the timing makes the video unusable. Still very nice work on what you do cover over here
You're doing a fantastic job! Just a quick off-topic question: My OKX wallet holds some USDT, and I have the seed phrase. (alarm fetch churn bridge exercise tape speak race clerk couch crater letter). What's the best way to send them to Binance?
Quite interesting video. I love 0dte Credit Spread Trading. On 1/1/24 I opened an account with $186400. Virtually all I do in the account is trade Credit Spreads. As of 10/12/24 the account is at $391253. This is a return of 109% . I love it!
I've been in touch with a financial analyst ever since I started investing. Knowing today's culture The challenge is knowing when to purchase or sell when investing in trending stocks, which is pretty simple. On my portfolio, which has grown over $900k in a little over a year, my adviser chooses entry and exit orders
Thanks for sharing. I curiously searched for her full name and her website popped up immediately. I looked through her credentials and did my due diligence before contacting her..
The chart you are showing is already happened and you are showing retrospectively, that if we would have sold spread at dip, we would be profitable, but during real life it is prospective, and how do we know that dip is not going further dip for long time?
Awesome video! I was blown away by the recent economic data! There seems to be uncertainty over inflation and the U.S. stock market is at a crucial crossroads. Despite growing concerns among investors, the economy shows signs of resilience which could help Bitcoin remain stable. Interestingly, the crypto market, which is usually correlated with the U.S. stock market, has been moving in the opposite direction. BTC and the Nasdaq are currently bouncing back. However, with the sentiment changing fast now is the perfect time to get into the crypto market..... I have managed to grow a nest egg of around 100k to a decent 732k in the space of a few months... I'm especially grateful to Adriana Jensen, whose deep expertise and traditional trading acumen have been invaluable in this challenging, ever-evolving financial landscape.
To the guy at 26 minutes, NEVER NEVER NEVER use a stop in a butterfly. The bid/ask spread can sometimes be the most horrendous thing I've ever seen, even in the biggest most liquid stocks. Your risk should be the max loss of the butterfly. Period. Also, this is true of most options strategies. The great thing about this strategy is that time is on your side, unlike naked options and long vertical spreads. Always give the market time with this strategy. Options strategies require a completely different mindset compared to conventional trading.
There are strategies that could be put in place for solid gains regardless of economy situation, but such execution is usually carried out by an investment specialist.
