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June 19, 2019

What Did We Learn from the FOMC Meeting Today?

The long awaited, two-day FOMC meeting ended today with the release of their statement, their forecasts, and the Q&A from Chairman Powell.  What did we learn? The Federal Reserve on Wednesday left its short-term fed funds rate unchanged and said it “will closely monitor” the economy in light of growing “uncertainties.” The so-called dot-plot projections […]

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June 19, 2019

Expiration Trading Can Be a Harrowing Experience

Trading expiring options can be a challenge.  There is a finality to when that bell rings at 3 pm on Friday.  It is either going to become underlying stock or it simply goes away.  It can cause a lot of anxiety for new traders (and perhaps some seasoned ones) if they do not properly assess […]

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June 19, 2019

How Can Gamma Effect My Option Position?

Gamma is a risk parameter used in options pricing.  It is the speed at which delta changes as the underlying asset moves up or down.  But how can that affect one’s options position? Click the video below to find out. Follow me on Twitter @CboeSib

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June 18, 2019

All of This Talk of Implied Volatility, What Is It Really?

Implied volatility is a parameter that is part of an option pricing model, typically some derivation of the Black-Scholes model, which gives the theoretical price of an option. Implied volatility shows how the marketplace views where volatility should be in the future. Since implied volatility is forward-looking, it helps us gauge the sentiment or expectation […]

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June 18, 2019

How to Define and Manage Risk in an Iron Condor

We presently have an iron condor signal on in Tesla Inc. (Ticker: TSLA). Click the video below as we discuss our current signal, define and manage the risk and apply them in our trading methodology. Follow me on Twitter @CboeSib

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June 17, 2019

Want To Go On A TJX Shopping Spree With Us?

Click the video below as we discuss our current signal in TJ Maxx (Ticker: TJX) and how to apply them in our trading methodology. Follow me on Twitter @CboeSib

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June 17, 2019

What To Think About This Week’s FOMC Meeting.

The CME FedWatch Tool analyzes the probability of FOMC rate moves for upcoming meetings. Using 30-Day Fed Fund futures pricing data, which have long been relied upon to express the market’s views on the likelihood of changes in U.S. monetary policy, the tool visualizes both current and historical probabilities of various FOMC rate change outcomes […]

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June 17, 2019

Why Do We Use Standard Deviation?

The standard deviation formula is very simple: it is the square root of the variance. It is the most commonly used measure of spread. An important attribute of the standard deviation as a measure of spread is that if the mean and standard deviation of a normal distribution are known, it is possible to compute the percentile rank […]

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June 16, 2019

It’s Allocation! Allocation! Allocation!

When I talk to new (and even some veteran) traders when they are struggling with their trading, invariably one of the issues that they have is allocation.  Options traders should not characterize themselves as a “5 lot trader” or a “10 lot trader” as a futures trader may.  Futures traders typically manage their risk by […]

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June 16, 2019

When to Use a Calendar Spread vs. a Diagonal Spread

Calendar spreads and diagonal spreads have many similarities but also some important differences. Click the video below as we discuss these types of signals and how to apply them in our approach to Advanced Micro Devices (Ticker: AMD). Follow me on Twitter @CboeSib

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