OptionStrat Blog

Oil is Back – For Now

Crude oil is back. Having rallied almost 20% so far this year, Brent is hovering around $90 and is up over 16% year-to-date. Shooting above the psychologically important $100+ level may even be in the...

Green Investing: Not the Color of Money

Last September, I wrote a blog entitled Green Risk, in which I detailed some of the disappointments that green investors have faced. My point was not to question their desire to limit carbon emissions, but...

Triple Witching Days: Not That Occult!

Once a quarter, the market experiences the so-called Triple Witching Day, or the simultaneous expiration on the same day of stock options, stock index futures, and stock index options. The last one was on March...

Gambling… Sort Of

Lately, some trader friends of mine have been asking me about short-dated options and whether they should trade them or not. When I answer, “it depends,” they aren’t’ happy — they want a simple yes...

Front and Center: Bitcoin & Gold?

From what’s been going on lately in Bitcoin and Gold, one would think that the world is on the edge of Armageddon. After languishing for most of 2022 and ’23, Bitcoin is up, as of...

EVs: Too Negative, Too Fast?

The lofty heights surrounding artificial intelligence leads one to wonder whether it will eventually suffer the same fate as another sector that has had its day in the sun, electric vehicles. In my neighborhood, you...

Nvidia — My Two Cents

Nvidia was a Wall Street mega darling even before its incredible results were announced last Wednesday night. Since then, it has been anointed The Greatest Stock of All Time. Press coverage has been universally positive...

The VIX: Beware!

I’m asked frequently why the VIX doesn’t seem to rally all that often or all that much. I tackled this question last October in a blog entitled The VIX: Hope Springs Eternal! but thought it was time...

The Magnificent Seven

Not a day goes by lately that you don’t hear about the performance of the Magnificent Seven. Nvidia (NVDA), Meta (META), Amazon (AMZN) and Microsoft (MSFT) are up an astonishing 49.8%, 35.2%, 16.4%, and 13.4%...

LNG Uncertainty

I’ve written several times about Liquified Natural Gas (LNG) and the world’s second largest producer, Cheniere Energy (ticker = LNG, conveniently and confusingly). In a nutshell, LNG is natural gas that has been refrigerated into...

Only Gold

It was 176 years ago last Wednesday that gold was discovered at Sutter’s Mill in California. Despite the fact that it gets very little notice, the discovery triggered the gold rush, western migration, and had...

SAVE Us!

I’m talking about Spirit Airlines (SAVE), and just couldn’t resist the pun. As you probably know if you follow the airline sector, Jet Blue’s proposed $3.8 billion merger with super low cost Spirit was blocked...

Uranium is Glowing

Yes, uranium. If you’re looking for an esoteric investment play that will dazzle your friends, this just might be the thing! In wrote about uranium last September (Uranium?) and concluded “__With increasing demand and uncertainties hanging...

Buying Disaster

It’s every flyers worst nightmare: a part of the plane blows off in flight and leaves a gaping hole in the fuselage. Open, blue skies and the wind rushing through the cabin is not exactly...

Stocks vs. Bonds, Who Wins?

To begin, allow me to wish you and yours a happy, healthy, and prosperous 2024! In my last blog, last year, I noted that it has become an almost unanimous opinion among many investors that...

The Doomsday Book

One story that came out last week but did not gain a lot of attention was the release of the “Doomsday Book” by the NY Fed. Although it sounds like something right out of Harry...

Terror Trading?

On December 4, two law professors, Robert J. Jackson, Jr of NYU and Joshua Mitts of Columbia, issued a pre-print study (i.e., not peer reviewed) entitled Trading on Terror? In the Introduction, the authors write: On October...

Too Low?

A recent market development that should be getting more attention is the seemingly endless slide of the VIX. For those of you who aren’t familiar with it, the VIX is an index that measures the...

LNG: A Downside Emerges

Most Americans don’t know it, but Europe had a full blown energy crisis during the Fall and Winter of 2022. I wrote about it in August of that year (European Issues) and several times since, focusing on...

Bitcoin: The Dream Lives On?

As is its habit, Bitcoin is back in the news lately. Bitcoin futures have been rallying, almost without a break, since the beginning of the year. As of this writing, it’s up a whopping 122%...

Athleisure?

Looking around after boarding a plane recently, I had to ask: does anyone wear real pants anymore? Not that I’m nostalgic for the era when people got all dressed up to fly, but the answer...

Green Energy and Red Ink

It’s important in investing not to let preconceived notions get in the way of real world economics and financial results. A great example of this is what I wrote about last week, the problems suddenly...

0DTE Options: Straight Talk

If you’ve been trading options for the last few years, then undoubtedly you’ve read all about the explosive growth of 0DTE options and have probably even traded them for yourself. For the uninitiated, “0DTE” stands...

Supply and Demand: Inescapable

This week, an update on two completely unrelated blogs I wrote previously, More Teslas?, 11/21/2022, and Orange You Smart, 03/08/2023. Both tales feature one of the most immutable forces in economics, supply and demand, and in addition might...

War, Again and Again

I had intended to write this week’s blog about 0DTE options and their effect on the market. Sadly, the war in the Middle East is now center stage. As I wrote at the beginning of...

The VIX: Hope Springs Eternal!

If you follow the VIX (which you should if you trade options), you know that it hasn’t been that exciting lately. As I’ve heard many traders and investors say, “it doesn’t seem to move anymore,...

Green Risk

In July, I wrote about sustainable aviation fuel, or SAF (Overpriced SAF?). It’s not the most exciting topic in the world, but it does display one possible hazard of investing in the green revolution, or...

Energy

It just caught the attention of the non-energy markets and popular press that crude oil has been rallying since last June. In general, if crude has a shot at breaking $100, and its accompanied by...

Uranium?

For those of you who have moved on from conventional and dirty fossil fuels, uranium might be of interest. Uranium is the primary source of nuclear power, and although certainly more controversial than wind or...

Nostradamus, Not!

I’m on vacation this week, but thought I would write a short note anyway. For new traders, it’s very tempting to think that someone has figured out the market and can predict it’s every twist...

Retail Zombies

One of the longest-lasting effects of Covid is the way people buy things. Unwilling to leave the house, people naturally pivoted to fulfilling their needs online, accelerating a trend that had already started in the...

Just a Few Stocks

Last week, I ended my blog (Memes are Back) by noting that that is was ok to trade the latest meme stocks, but “…don’t take your eyes off the prize — finding stocks that take...

Memes are Back

Apparently, trading by individual investors is still going strong. Although it seems that most have moved on from their dreams of trading full time, some have rekindled their passion for that Holy Grail of day...

Storage Wars!

Here’s a crazy statistic: researchers estimate that 1 in 10 Americans lease storage space. Some report that it’s even higher, at 20%. Whichever number you believe, that’s a lot of people, somewhere between 33 and...

Let’s Fly!

Last week, I flew for the first time in several months. As a consultant, I used to fly about once a week, and often internationally. As a former super frequent flyer, I remembered what I...

Whoppers!

I went to McDonald’s (MCD) last weekend for the first time in a few years and it was a different place than I remember. First off, there were no employees to greet and take orders...

It’s Hot!

One of the most underappreciated and mundane inventions of the 21st century is air conditioning. Although it rarely makes it to anyone’s Top 10 Inventions list, A/C was essential to the development of skyscrapers (upper...

The Coup That Wasn’t

When asked how he went bankrupt, Hemmingway famously replied, “Two ways. Gradually, then suddenly.” I remembered this over the weekend while keeping track of the mutiny/rebellion/uprising/coup/protest (or whatever it was) that was going on in...

Remember WeWork?

My son, who has a real day job but trades stocks on the side, pointed out to me the other day that WeWork was trading at $0.23 cents. Frankly, I didn’t even know that WeWork (WE)...

Overpriced SAF?

Although most people take them for granted, large commercial airliners are pretty incredible machines. Take the Airbus A380, the largest commercial aircraft in the world. At about 240 feet long and almost 80 feet high,...

Cruisin’!

I wrote about cruise lines last December and at the end of May (Cruises are Back!), the gist being that they were beaten down by Covid but might be a good long-term play. Pent up post-Covid...

There’s Money in Garbage

For those looking, the waste disposal industry has been getting a lot of attention lately. Why the sudden interest? Because collecting garbage is no longer about just taking out the trash, but about two of...

Cruises are Back!

Last December, I wrote about cruise lines and how they were almost destroyed by Covid (Let’s Take a Cruise). The outlook at the beginning of the pandemic was pretty bleak. As I noted, “I can’t...

Weighty Matters

I’m not a diet person, but I couldn’t help noticing that some relatively new weight loss drugs have been getting a lot of attention from entertainment and social media types. The drugs, Wegovy and Ozempic,...

Something to Worry About, Part 2

Last week, I wrote about the intensifying debt ceiling crisis (Something Real to Worry About, No Kidding!) and that the equity markets don’t seem to be taking it too seriously. Since then, and with time...

Something Real to Worry About, No Kidding!

Last February, I wrote about the debt ceiling in Something to Worry About. In it, I noted that “…as we get closer to June or financial insolvency, the greater the effect will be. A high impact/low...

New Look & New Options Model

We’re excited to announce the launch of our new branding for OptionStrat! At OptionStrat, we strive to make options investing easier and more accessible for everyone, regardless of experience level. Our new branding reflects this...

All That Glitters?

I’ve written about the recent gold rally a few times now (Crudely Speaking) and (Gold Bugs and the Debt Boogeyman). The precious metal, and its digital cousin, Bitcoin, benefited from the SVB crisis, which confirmed...

Crudely Speaking

It’s been a long time since an OPEC meeting completely surprised the oil markets. There are just too many people associated with the organization, as well as too much money at stake, to keep anything...

It’s NOT 2008!

People tend to think that whichever disaster they lived through personally was either the worst and most earth-shattering in history or a close contender. Hence, the usual clickbait headlines proclaiming “The worst [insert specific natural...

Wanna Bet?

Most of you are probably sick of reading about the banking crisis by now. I know I am. Let’s discuss something more interesting, or at least more fun: how to make money on sports betting...

Black Swan

I would be remiss if I didn’t comment on the latest event roiling financial markets, the sudden death of Silicon Valley Bank, the near death of Credit Suisse, and the derisking affecting markets worldwide. I’m...

Orange You Smart

Believe it or not, Orange You Smart was a TV ad campaign from the early 80’s promoting Florida citrus. I thought of it the other day while buying some very expensive orange juice, the kind that induces sudden sticker...

Hopes and Dreams

This week, let’s review some companies that succumbed to dreaming instead of managing. I’ve reviewed Rivian (RIVN) and Beyond Meat (BYND) before, but Salesforce (CRM) now joins the club. Although BYND and CRM are in...

Split Strikes

A few blogs ago, I recommended watching the new Madoff documentary on Netflix. By now, most of you know the story, but it does bring to light some details relevant to investing and options trading...

The Crypt Keeper Emerges

I mentioned a few weeks ago that Bitcoin was starting to show some life after its near-death experience during the crypto meltdown (Surprise! Crypto Might be Back!). At the time, I hesitantly wrote that bitcoin...

Peloton is Back: Sort Of, Kind Of, Maybe

Peloton (PTON), that avatar of Things-Upper-Middle-Class-People-Did-During-Covid, is back (well, might be back). I wrote about Peloton frequently last year because it so well encapsulated the boom-and-bust cycle of many companies that thought Covid would go on forever....

Gold Bugs and the Debt Boogeyman

Traders generally fall into one of four categories on Wall St: equity, bonds, foreign exchange, or commodities. Sure, there is some crossover, but that’s about it. I’m a commodity guy and have been for most...

Tesla, ONE More Time

Last week, I wrote about everybody’s favorite, Tesla. Since I’m an options guy, I was quick to admit that I had no special insight on the stock’s fundamentals. However, being a recent EV shopper, I...

Tesla, My Two Cents

This week, I’m going to start by writing about one of the most covered stocks in the history of man, Tesla. Being an options guy, I don’t have much to add on its fundamental situation....

Ark, Again

I wrote about Cathy Wood’s ARK Innovation Fund earlier in the month (2023). Coincidentally, a long-time friend of mine, Richard Gluck, author of the Market Cyclist Substack blog (The Market Cyclist), mentioned it as well...

2023

To begin, a healthy, happy, and prosperous new year to one and all! I’m going to start the new year by looking back at some stocks I covered in 2022 and see if we can...

Straddlers Beware

Last week, I demonstrated the Visual Greeks feature of OptionStrat using Cheniere Energy (LNG) as an example. The visual greeks feature is a new addition to our options profit calculator that makes it easy to...

Visual Greeks and LNG

When I first started trading options, valuation and analytical support were extremely limited. I had nothing even approaching the usefulness of OptionStrat. Let’s take just one feature, Visual Greeks, and how it can help analyze...

With Enough Money

The War Won’t Stop It seems that most people have forgotten that there’s still a war in the Ukraine and it continues to influence energy prices. As Americans, we’re far removed from the fighting and...

Let’s Take a Cruise

I read an article a few days ago about a giant rogue wave that hit a cruise ship, just like in the Poseidon Adventure! If this happened in March 2020, right at the beginning of...

Is Crypto Dead?

Perhaps the biggest financial story of 2022 has been the implosion of the crypto market. FTX and Sam Brinkman-Fried have dominated the news over the last few weeks, and rightly so — it’s a great...

More Teslas?

This week, I’m going to concentrate on electric vehicle manufacturers other than Tesla. Rivian, Lucid, Fisker, Nikola, and Lordstown, if not exactly household names, have all been hard at work trying to carve out a niche...

Pros are Different

I often write about individual stocks that I think are interesting, mispriced, or in the news. Sometimes, they just have cool names that merit investigation (e.g., Rocket Lab). In all cases, I include a chart...

Meta and Snap: The Undead

I’m not crazy about unanimous opinions, especially when it comes to stocks. Usually, the situation isn’t as bad (or as good) as the consensus indicates. Recently, Meta and Snapchat both took it below the waterline...

Rockets for the Future

This week, I’m keeping up my review of futuristic, disruptive stocks whose business models or products were a figment of someone’s imagination just a few years ago. One stock that certainly qualifies (and has a...

Flying Stocks!

I think anybody that has ever been stuck in traffic has thought how cool it would be to own your own personal flying machine. Just like George Jetson, you could fly above it all, zipping...

PTON Anyone?

Yes, I know I’ve written about Peloton a lot. Unlike most stocks, it seems that something new happens every week that changes my view of its long-term prospects. Who would have predicted that two years...

Swiss Mess

If you follow juicy Wall St. scandals, as I do, Credit Suisse’s latest nosedive shouldn’t have come as a surprise. CS has been at the center of some of the most irresponsible behavior over the...

Dr. Doom

Beyond Meat I hadn’t looked at it for some time, but it was pointed out to me that Beyond Meat (BYND) is down over 76% YTD and is currently trading in the $15 region with...

Event Options, Avaya!

Last July, I wrote about the CME’s latest wunderprodukt, Event Options. At the time, the exchange was seeking approval from the CFTC to launch. It was granted, and last Monday, September 19th, was the first...

The War’s Not Over

Despite Ukraine’s recent gains, a military solution to the conflict is unlikely. Both sides will eventually seek negotiations. For Putin, for survival; for Ukraine, under Western pressure. Regardless of the outcome of the war, Europe’s...

Europe. Bring a Good Coat, Maybe!

The gathering storm in Europe is even more serious than when I last wrote about it a few weeks ago. EC energy ministers are getting together this Friday to discuss various measures to lower natural...

Revenge of the Memes

Two meme stocks in the news, AMC and Bed, Bath, and Beyond, are trading at triple digit implied volatility levels , those usually associated with the most volatile, supply-constrained commodities. Their options are priced accordingly (i.e., super...

New Greek Visualization Features

Our options profit calculator tool is used by traders around the globe to visualize the potential profit and loss of option strategies over time. Many traders tell us it’s the first step they do before...

European Issues

Europe has a full-fledged energy crisis on its hands. Consequently, liquified natural gas prices are soaring and have increased over 7 times from a year ago. This makes a compelling case for Cheniere Energy (LNG),...

Natural Gas Stocks: A Not So Sleeping Giant?

The European energy situation is driving up natural gas to prices not seen since 2005 and 2008. Consequently, certain natural gas related stock options could be excellent opportunities when viewed in relation to their implied...

Risk Management for Dummies

Numerous studies have come to the same conclusion: you can’t time the market. You might be able to every now and then, but it’s extremely rare to beat the market consistently and in the long...

Beware of the “It’s Cheap!” Trap

At one point in my career, I was the risk manager for an absolute return hedge fund. For those of you who aren’t hip to cool kid hedge fund lingo, an absolute return hedge fund...

Tales from the Crypt

This week, I thought I would check in on some stocks that I have reported on previously, as well as one newcomer. I warn you now, it’s a depressing bunch, but if you like buying...

Inflation: Not So Fast!

It’s unanimous: inflation is going nuts and is the highest it’s been since the 70’s! Most people can’t relate to this since they weren’t even alive in the 70s (the average age in the US...

Event Options: Viva Las Vegas!

Every exchange has a bunch of people whose sole job is to think up new products and drum up new volume. Some of the new products actually make it off the drawing board and are...

The Dollar, Again

The Dollar As I wrote last week, the dollar continues to be the king of the FX forest and has soared to roughly 20-year highs against the Euro and Japanese Yen. Less heralded is the...

Auto-Updating quotes now available!

Auto-updating quotes are now available to all premium subscribers! (Free users will still receive 15 minute delayed quotes which must be manually refreshed) Currently the auto-updating quotes are only available for the options profit calculator portion of...

All Hail the Dollar!

With all the news about inflation and gas prices and various other depressing news, the incredibly high value of the dollar has largely flown under the radar. Unless you trade foreign exchange, hedge a company’s...

Visiting Some Old Friends

Some of my previous blogs focused on the so-called Covid Darlings, the stocks that benefited from Covid, but are now subject to extreme selling pressure. I have also featured several stocks that benefited from the...

ARK Just Ain’t What It Used to Be

Cathie Wood’s ARK Innovation ETF skyrocketed to mass popularity when it delivered a solid 35.7% return in 2019 and then followed up with an eyepopping 156.6% in 2020. She is now firmly enshrined as a...

Trees Don’t Grow to the Sky!

Last week, I attended a derivatives conference in Las Vegas (Quants in Vegas, an interesting combination). Like all conferences, it was a chance to see and be seen and to check out what everybody else...

Crypto Shenanigans

As you know, lately I have been writing about cryptocurrencies and how they have not been acting as advertised (to say the least). Each week has brought new revelations, culminating last week in crypto’s first...

Shocking!

Last weekend, a horse aptly named Rich Strike won the Kentucky Derby. Believe it or not, he was an 80-1 long shot. I don’t know much about horse racing (actually, nothing), but I do know...

Apocalypse Now?

This week, the tone of the markets took on a decidedly apocalyptic tone. Inflation, war, interest rates, Covid, stagflation…the list goes on and on. Interesting that everybody seemed to be a lot happier with the...

Covid is Over?

Apparently, a federal judge in Florida has decided for all of us that the pandemic is officially over. Glad to know it, but as anyone that has been following Covid-related stocks (see PayPal, Meta, Moderna,...

War, the Dollar, and an Exchange Warning

Ukraine, Again As I write this, the War in Ukraine continues to rage on with no end in sight. Despite early hopes of a Ukrainian “victory” leading to a forced ceasefire, Putin and Russia (are...

This Week’s Market: Prom Night is Over?

Volatility Roundup As we noted at the start of last week, the bull market was starting to feel like prom night at 3am. For traders new and old, last week was a wild ride with...

Bitcoin and Geopolitical Risk: The Jury is Still Out

It’s always interesting when markets refuse to follow conventional wisdom. For example, in March 2020 amidst the scary beginnings of Covid, you couldn’t find too many people who were bullish equity and real estate. Gloom and doom...

Random Musings, Interesting Stuff

More about Nickel Last week, we discussed the crazy goings on in the nickel market and why retail investors should take note. As I wrote, Tsingshan Holdings, the world’s largest producer of nickel and founded...

Pay Attention to Nickel!

Imagine that one day you’re trading away in a pretty quiet stock and all of sudden it goes up 66% one day and then doubles the next over the course of 18 minutes. Also imagine...

Ceasefire Ruminations

I’ve been writing about uncertainly and its effect on implied volatility over the last several weeks. You can’t get much more uncertain than how the Russian/Ukraine situation will ultimately turn out. One of the basic...

Geopolitical Shocks Are Not That Shocking!

Before I get into last week’s options analysis, I think it best to quote an old friend of mine from the markets: I am not a geopolitical analyst and I have not become one since...

Volatility Effects of the Russia/Ukraine Situation

As we have written over the last several weeks, the Russia/Ukraine situation may produce some opportunities in options trading that don’t come along too often. Luckily, and despite the best efforts of various sociopathic and monomaniacal world...

Options Calculator Improvements

Today we are launching a series of improvements to our options profit calculator product known as the strategy builder. These changes focus on making it easier to manage strategies throughout their lifetime. Here’s the quick...

Covid Volatility

Volatility Roundup The bull market party has been going on since roughly 2009 (and who would have predicted that at the very bottom of the financial crisis?) but is obviously getting a little decrepit. Anxiety...

LNG Results: A Mixed Bag!

Last blog (2023), I said I would review the short term results of the Cheniere Energy (LNG) options strategies I discussed previously (Visual Greeks and LNG) and (Straddlers Beware). Summarizing, Cheniere Energy is the world’s...

Indices (SPX, VIX, etc) and Global Trading Hours

New index data We are expanding our platform to include data from some major stock market indices and their options: SPX: S&P 500 Index VIX: Cboe Volatility Index XSP: Mini S&P 500 Index (Similar to SPY at 1/10th...

New Premium Feature: Probability Distributions

As an addition to the premium chance of profit feature, premium users can now view an overlay of the stock’s probability distribution when using the graph view in our options profit calculator. The probability distribution...

Update: Saved Trade & Paper Trading Improvements

OptionStrat’s saved trade system has been revamped! Over the past few weeks we have added some highly requested features to give the saved trade system a makeover. Instead of being a simple list of saved...

New Feature: Historical Price Charts

We are launching an exciting new feature for OptionStrat today: Historical price charts! You can now view the past price history for any strategy by clicking the historical price button on the strategy builder screen....

Live Data Now Available

We are happy to announce that our live data plan is now available! Live data will apply to both the options profit calculator (aka strategy builder) and options optimizer tools. Stock and option quotes are...

Using OptionStrat’s Options Profit Calculator

When trading options, it’s important to understand the characteristics of your options strategy. An options profit calculator like OptionStrat is used to find the potential profit and loss at various prices, as well as show...

New Feature: Custom Multi-Expiration Strategies

Since day one OptionStrat has had support for multi-expiration strategies such as calendar and diagonal spreads, and today we are launching an update to enhance the multi-expiration features. Now it is possible to add an...

OptionStrat Apps Now Available

OptionStrat is now available as an app for mobile devices! Now you can use OptionStrat on the go alongside your other mobile trading apps. All of the features available on the desktop version, including our options...

Introducing the Options Optimizer

Today we are releasing the new options optimizer tool for public testing. The options optimizer makes it easy to search through thousands of potential trades and focus on the ones that matter: the strategies with maximum return,...

OptionStrat Beta Launch

As of today OptionStrat is now available to the public! Thank you to the pre-beta testers who helped provide valuable feedback. OptionStrat is a tool for creating and visualizing option trades on U.S. stocks. It...

How Implied Volatility Affects Options

You may have heard of “IV crush” before, or maybe experienced it first-hand when you got the direction of a stock correct but your options still lost value after earnings. Implied volatility, or IV, is...

Entering an Existing Trade

OptionStrat is capable of showing future profit and loss calculations on positions that are already established. To input a trade that you have already opened, select the type of trade from the strategy menu (for...