The Option Alpha Podcast

Show notes: http://optionalpha.com/show120 Over the last 10+ years I've seen thousands, and coached hundreds, of traders navigate the markets. And if you study option trader success long enough (and geek out about it as much as I do) then you'll quickly come to realize that success is nothing more than a persistent person with great habits and a clear mind. Today's show focusing on...

Show notes: http://optionalpha.com/show119 The last couple weeks of trading for many newbie investors was quite the learning experience. The market fell from all time highs quickly and then recovered nearly half of that move in a single week. Still, we got a flood of emails from people who were not well positioned for the drop in equity prices and learned the hard way why you can't practice t...

Show notes: http://optionalpha.com/show118 It's always good to look back and analyze what happened in the past. Often times it can help shape the future (good or bad) and how you trade moving forward. In today's show, I want to take some time to share my top five options trading psychology lessons I learned over the last 18 months. Many of these I scripted out well before the recent mini...

Show notes: http://optionalpha.com/show117 One of the most popular and widely used options greek is Delta. And while I believe that you can't necessarily learn about option pricing and option greeks in a vacuum as they all work together to represent potential price action for changing market conditions, having a solid understanding of how Delta works is important both in entering new position...

Show notes: http://optionalpha.com/show116 You've targeted a stock or ETF setup you like and want to make a directional trade. Maybe some technical indicator alerted you to a possible turn in the underlying or you just needed to hedge your portfolio with a new trade. Whatever the case, you are now left wondering why type of options strategy to pick. How do you decide between trading debit spr...

Show notes: http://optionalpha.com/show115   As with many things in life the 80/20 principle can help guide and focus our attention on the most important aspects of options trading. In particular, trade entry and executing an options order correctly is critical to your success. I've often said that great entries save you from having to be good at everything else, like adjustments and rolling...

Show notes: http://optionalpha.com/show114 Short straddles and short iron butterflies are some of our most profitable option strategies, and a consistent staple when trading in our PRO and ELITE membership levels. However, when it comes adjusting these positions and going "inverted" it can cause even the most experienced traders to freeze up. In today's podcast I wanted to walk thro...

Show notes: http://optionalpha.com/robinhood Often times people ask me why I continue to run Option Alpha and give away so much free content, courses and training when we could easily charge for it? And the simple answer is that I'm in it for the relationships I build, the people I meet, and the investors lives we change by teaching them how to have more confidence and place smarter trades. T...

Show notes: http://optionalpha.com/show113 Often times when new traders go through their first couple earnings cycles and experience large moves in the underlying stock, it can feel almost natural to want to buy contracts via a long straddle earnings option strategy as opposed to selling options the way we teach here at Option Alpha. In today's show, I'll preview some of the new research...

Show notes: http://optionalpha.com/show112 Depending on where you started your options education, trade frequency was either glossed over or talked about in-depth. Here at Option Alpha, we've suggested for almost a decade now that to find success you need to be placing trades almost daily. But does this frequent trading activity classify us as "day traders" in the options market? If...

Show notes: http://optionalpha.com/show111 You made an options trade and the position has gone well, leaving you with a nice fat profit as expiration approaches. Now the question becomes, what do you do with these cheap out of the money option contracts you sold? Do you buy back your penny options or let them expire worthless? Are there risks to do one over the other and when should you lean one w...

Show notes: http://optionalpha.com/show110 Why do we still believe that magically someday we'll have some inside scoop or tip that alerts us to market tops and bottoms? As hopefully rationale adults we often get lured into a false sense of understanding in the financial markets brought on mainly by the media and talking heads. Today I want to help you become a better options trader by not wat...

Show notes: http://optionalpha.com/show109 Unlimited risk option strategies get a bad rap in the investing community among newbie traders. And while our backtesting research has shown that unlimited risk positions like short straddles and short strangles generate the best overall returns, you might be restricted in trading them because of your account type or just fear the big potential drawdowns....

Show notes: http://optionalpha.com/show108 If you trade options longer than ten days you'll undoubtedly run into a scenario where you get challenged by a stock moving either higher or lower against your position. When this happens the first question many people ask is "Do I start rolling up strike prices and adjust the position or work on closing out the trade completely at a loss?"...

Show notes: http://optionalpha.com/show107 Today I've very excited to bring one of our very own Option Alpha family members on the show, MACDDaddy aka Robert. He's been a member for many years and someone I continue to seek advice from in many areas. During the show we'll dig deeper into the "Wheel Selling" option strategy which has created some fairly long and in-depth fo...

Show notes: http://optionalpha.com/show106 As some point or another new option traders worry about their option contracts being assigned. Namely short call options getting short stock assignment. But it's never as bad or horrifying as it may seem and in today's latest show I want to walk through our TLT iron butterfly trade in which we ended up getting assigned 200 shares of short stock...

Show notes: http://optionalpha.com/show105 The further the markets continue to run higher, the greater the risk that another major market correction or market crash will happen in the near future. After all, as we pointed out in Show #15, the stock market has fallen 9 times at least 30% which is once every 10 years. Right now we're riding a 10-year bull rally that's losing steam fast. So...

Show notes: http://optionalpha.com/show104 On today's newest podcast I want to turn the conversation a bit and focus on pairs trading with options. And this isn't the traditional pairs trading that you might have heard about before where you short one stock and buy another related stock to profit from any trending differences or divergences in the underlying price. Instead, I want to tal...

Show notes: http://optionalpha.com/show103 Even after discussing and outlining the general process for how to pick the right stock options strategy in previous podcast and videos, I continue to get members who are confused how it should work and the steps one might take. I ultimately believe that in most cases you might be over-thinking it especially when it comes to choosing tickers and market di...

Show notes: http://optionalpha.com/show102 When selling options, often I get a question or inquiry from members of our community with regard to how far out of the money we should sell our options and set our positions. Now, I typically target around the 70% probability of success area for my short option selling trades, but others have often wondered that if given the choice why we don't just...

Show notes: http://optionalpha.com/show101 I believe that on some level every new trader dreams of trading options full time and not working a regular job. The reality is however, that you're need a lot of capital before you make the leap to full time trading and that means you'll have to learn how to effectively trading options while working your day job. Hard as it may seem at first, w...

Show notes: http://optionalpha.com/show100   Not only is today special because we're releasing our newest research report called The Profit Matrix but also because as soon as this show goes live we'll have crossed more than 1,000,000 downloads on the podcast. Crazy coincidence but it's true and very humbling, so thank you to all of you who have supported and listened over the last c...

Show notes: http://optionalpha.com/show99 The investing world in the next 5-10 years is going to look dramatically different. In fact, the shift to automated trading is already happening at the highest levels and with the biggest hedge funds. So, why is this happening? Why can't we just ignore it? And what can we do now to position ourselves to take advantage of automated trading systems now?...

Show notes: http://optionalpha.com/show98 The markets are evolving faster and faster as the introduction and use of computer-driven or data-driven trading systems start to hit exponential growth rates. So, the question becomes, is this the end of systematic risk and market uncertainty? To put it bluntly, no - in fact, never will we reach a point at which there isn't some sort of systematic ri...

Show notes: http://optionalpha.com/show97 Today we're going to use our new Trader's Toolbox and options backtesting software to test win rates when selling options. Because the truth is many people have this huge "rub" with options trading and expected vs. actual win rates. They assume that if we place a new trade with an initial probability of success of 70% that the trade wil...