The Ledge Methodology is a derivation of the Crossover Scalp. It uses the exact same chart as the Crossover Scalp but in a different way. When markets are calm and orderly, the Crossover Scalp has proven to be a very effective tool in our trading in the STO Room. But as we know, the markets […]
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So you have pulled the trigger and entered into an options spread. Congratulations! Now what? Managing the signal is just as important as your decision to enter one. Click the video below to find out how you can use delta to target your entry and exit levels. Follow me on Twitter @MikeShorrCbot
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Open interest is a concept that is unique to options. Volume is a parallel concept to stocks. First, what are they? Second, why should an options trader care about them? Open interest is the number of active contracts. It is a metric that can be tracked or displayed on most options trading platforms, like bid […]
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IWM is a market to watch as we start to bounce. The SPY also has major resistance but we can potentially see that resistance fail if IWM starts to charge up next week. So far today, we are seeing very bullish activity and IWM has been a leading indicator for the markets as of late. […]
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It’s hard enough to project which direction a stock is going to go. But then what? How far is it going to move over a given time period? Click the video below to find out exactly how we calculate the magnitude of the projected move using implied volatility. Follow me on Twitter: @cboesib
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Option margin is the cash or securities an investor must deposit in his account as collateral before writing – or selling – options. Margin requirements are established by the Federal Reserve Board in Regulation T. Option margin differs from other types of margin that you may associate with stock or futures trading. These types of margin allow a trader to employ leverage in […]
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You may have heard of the terms simple and compound accruals. What does it mean and how is it important to one’s trading account? Click the video below as I explain both of these concepts and how to apply them to your trading and risk methodologies. Follow me on Twitter @MikeShorrCBOT
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The bid price of any security is the highest price that someone is willing to pay for that security. The ask price of any security is the lowest price that someone is willing to sell that security. The “theo”, “mark” or “mid” price is simply the bid plus the offer divided by two. Click the […]
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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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Many traders look at their win to loss rate when evaluating their trading. This is an important concept, if you are right way more than you are wrong, you probably are not going to enjoy much success. But, many are missing one part of the puzzle, expected value. Not only IF you are right or […]
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