The Option Alpha Podcast

Show notes: http://optionalpha.com/show145 Is less more? Often we hear this phrase thrown about with the assumption that when investing you should do less, sit on your hands or trade further out, in order to generate higher profits and better returns. But is this really the case and does the math and data prove this to be the point? We wanted to put this assumption to the test with a couple backte...

Show notes: http://optionalpha.com/show144 On today's podcast, we bring in a very special interview guest, Larry Connors, and discuss his new book Buy the Fear, Sell the Greed. Larry is an established author in the trading and equities space and I thoroughly enjoyed our conversation about market dynamics, trading psychology, VXX pricing structures, and the future of the industry with regards...

Show notes: http://optionalpha.com/show143 Choosing which ticker symbols and option strategies to use when entering new option trades can sometimes seem overwhelming. In fact, many of our pro and elite members continually ask about the rationale behind why we choose one ticker symbol over another or use one strategy over another when building our portfolio. Today's podcast will help you under...

Show notes: http://optionalpha.com/show142 Many new options traders worry about what might happen to their portfolio during a short put option assignment scenario. They wonder how they can recover or if they have enough capital to hold onto the stock position.  just a few weeks ago we were assigned on one of our short put options in EWZ and were forced to buy stock well above where the stock price...

Show notes: http://optionalpha.com/show141 In the futures trading world, there are two words that sound cool to say but also might be very confusing for new traders; contango and backwardation. Yet, both of these future pricing concepts are very easy to understand once you know the relationship between three key items. In today's podcast, I want to slowly walk through the concept of contango...

Show notes: http://optionalpha.com/show140 Have you ever gotten the feeling that some of your trades just end up exploding in your face and turn into "massive" losing positions? They just never seem to go the way you thought it would and always demand or steal your attention right? Well, there's likely a couple reasons why this happens and it gets back down to some of the most basic...

Show notes: http://optionalpha.com/show139 We all fear losing money, it's a natural human emotion. Myself included, I fear losing money just as much as the next person. But today I want to try to walk through a rational and logic sequence of questions that I believe, if follow the series, will help you uncover the only true risk in the market to your portfolio - and more importantly how to av...

Show notes: http://optionalpha.com/show138 I'm going to go out on a limb and publicly declare that this podcast will be one of our top 3 to 5 shows we ever recorded. Aggressive and overly confident, maybe - but I have absolutely no doubt this podcast episode will be a game-changer for hundreds of thousands of options traders. The expected probability paradox for options traders, as I have coi...

Show notes: http://optionalpha.com/show137 Implied volatility in option pricing is one of the most critical and yet least understood aspects of this business. Today show focuses on a deep dive into options skew and the volatility smile for both inter-month and intra-month option contracts.  in addition, we'll talk very specifically about the impact of skew as expiration approaches and how Veg...

Show notes: http://optionalpha.com/show136 Are you new to options trading? Do you have a small account and want to start trading iron condors and iron butterflies? Today's podcast will be very important as we help you understand how to calculate breakeven prices on iron condors and other risk defined strategies the correct way. Plus, we'll walk through a multi-month adjustment to an exis...

Show notes: http://optionalpha.com/show135 Today we'll condense potentially an entire semester of financial engineering into a single podcast episode. The goal being to help completely understand how implied volatility works, why we need it, where it comes from, and how we can profit from it as option sellers. This show is a little longer than normal but I think the time spent walking through...

Show notes: http://optionalpha.com/show134 Nobody's trading or investing journey is a straight road or easy path. We never just magically trip into a perfect system or investing philosophy without a couple bumps along the way. Today's podcast focuses heavily on overcoming the stigma attached to being "wrong" and having the humility and grace to learn from trading mistakes and t...

Show notes: http://optionalpha.com/show133 With the rising popularity of weekly option contracts, many investors are choosing to trade weekly bull call spread option strategies as opposed to simply going long stock. The thought process is that by trading the weekly contracts you are able to more quickly adjust and profit from moves in the overall market. On today's show, we use our backtestin...

Show notes: http://optionalpha.com/show132 Some traders wrongly assume that if they can't trade unlimited risk option strategies, such as straddles and strangles, that they should just avoid trading altogether. Today however, I want to present four great alternative trades to some of the more common unlimited risk options strategies and help you learn how to convert these trades into their sy...

Show notes: http://optionalpha.com/show131 One of the more advanced techniques options traders use to reduce risk and increase the probability of success of the trade, is to roll contracts from one month to the next. Today's show focuses exclusively on rolling options forward, by showing you two different case studies in TLT and IWM. Both trades took multiple months to turn a profit and multi...

Show notes: http://optionalpha.com/show130 Seems most traders constantly struggle with getting option trades filled. And since we never suggest using "market orders" as a quick fix for entry problems, today I'm offering five quick tips for smoother option order execution. It's a simple framework you can walk through the next time you're having trouble getting a trade fille...

Show notes: http://optionalpha.com/show129 As options traders focused on income generation, it's important that we consistently work towards maintaining a diversified options portfolio. But are there any "earning warning signs" that we are starting to lose our grip and balance? In today's podcast, I've put together four things you can monitor so you don't wake up tomo...

Show notes: http://optionalpha.com/show128 How important is picking the right stock market direction when trading options? Depending on how you trade, it can be either vitally important or not important at all. Today's podcast offers some insight and examples of why higher trading frequency and why averaging down (or up) around the market creates an environment in which market direction becom...

Show notes: http://optionalpha.com/show127 You're ready to place an option trade and you're confident the stock is a good candidate. Now what? With dozens of contract months and hundreds of option strike prices to choose from - which ones do you select? In today's podcast, we'll help bring some more light to the "dynamic approach" we now use at Option Alpha for each a...

Show notes: http://optionalpha.com/show126 We're all busy; with work, family, school, kids, etc. And although many people might lead you to believe you have to be in front of the screen all day in order to manage multiple option positions, the reality it's not true. Yes, you do need to have access to the markets in order to trade right now (not in the future though), but you don't h...

Show notes: http://optionalpha.com/show125 Want to learn how to trade options the right way but feeling overwhelmed? It's like this big giant elephant is standing in front of you and you have to figure out a way to consume it. And the best way to do anything in like, like eating the proverbial elephant, is to tackle it one bite at a time. So today, I want to introduce two ways of learning how...

Show notes: http://optionalpha.com/show124 Selling cheap options with very high probabilities of success makes rationale sense on the outside. I mean, why sell options with a 70% chance of success when you can sell options further out that have a 90% chance of success. No brainer right? Well, not so fast. The options market is fair and efficient - and selling these far out-of-the-money options mig...

Show notes: http://optionalpha.com/show123 At Option Alpha we believe (and the research confirms) that the options trading possibilities for retail investors are nearly endless. Higher returns and better performance for your portfolio, but only if, you cross this one trading bridge first. So many newbie traders learn about options and the stock market and experience a rush of energy and motivation...

Show notes: http://optionalpha.com/show122 As options traders we need to focus on the levers that really move the needle in terms of generating income and cash flow for our portfolio. There's no point in doing something if it doesn't contribute to the overall profitability of the portfolio right? It'd be like shoveling your driveway before a huge snow storm. Or washing your car befo...

Show notes: http://optionalpha.com/show121 Trade long enough and save enough money and eventually, you'll need to make a couple small tweaks to your options strategy as you start managing larger trading accounts. Today's show is all about transitioning your options strategy in a way that optimizes the increased capital you have to invest. If you're not yet at the "large account...