Twilio (Ticker: TWLO) along with a lot of tech stocks got slammed today. At mid-day, it was down ~6%. But, there was no outside fundamental driver and in that absence, we turned to look for technical support. Take a look at the chart: Look where it found support. Right at the 50-DMA as we had […]
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We use the PTA Options Trading Tool constantly during the trading day. What is it and how do we use it. Click the tutorial video below to find out: Follow me on Twitter @MikeShorrCbot
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Implied volatility is a metric that captures the market’s view of the likelihood of changes in a given security’s price. Investors can use it to project future moves and supply and demand, and often employ it to price options contracts. Implied volatility is not the same as historical volatility, also known as realized volatility or statistical […]
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In contrast to historical volatility (HV), which looks at actual asset prices in the past, implied volatility (IV) looks ahead. … 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 Click the video below to see how we dive into this important aspect […]
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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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Implied Volatility (IV) and Vega are very much related but are by no means the same thing. Implied volatility has no direct correlation to actual past historical or statistical volatility; rather it is a measure of predicted future movement. Implied volatility tends to increase when there is uncertainty or anticipated news, while it tends to […]
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Today is a great day to talk about the VIX. It can be confusing. The VIX index and futures are connected by a statistical relationship that depends on how fast the VIX tends to move toward its average level, the volatility of the index and how much time is left until expiration. Near expiration, the […]
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One of the most powerful aspects of options is the concept of LEVERAGE. You are able to do more with less. For the same amount of investment capital, options allow you to own control over more units. Click the video below to see how we maximized leverage by constructing a vertical spread signal in ROKU. […]
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The VIX index and futures are connected by a statistical relationship that depends on how fast the VIX tends to move toward its average level, the volatility of the index and how much time is left until expiration. Near expiration, the futures will be close to the index and move in tandem with it, while […]
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NVIDIA Corporation (Ticker: NVDA) set up a classic technical indicator this morning that uncovered a great bullish opportunity. Given three data points, underlying stock price, option expiration date and the at-the-money implied volatility for that expiration we were able to determine that $185.00 was a very conservative target price. Click the video below to see how […]
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