In this MoneyShow.com interview, Lawrence G. McMillan "discusses why selling naked puts does not have to be as dangerous as many option traders may think." Larry explains why he prefers put-selling to covered writing, how he locates put-selling opportunities and what situations to avoid. Watch the video at Moneyshow by clicking the image below.
The CBOE has launched what may prove to be a very useful product – short-term $VIX futures ($VXST). The feature article discusses their terms and their potential usage. Also, there are comparative charts with $VIX and $VXST. If volume is decent, this should be an excellent product.
A lot has happened in the past three weeks, but $SPX is literally unchanged from where it was at that time. A nearly 100-point round trip has taken place -- down, then up.
A move above 1850, to new highs, would be very bullish for $SPX. Although if it happens right away, it will be without support from many of our indicators. Meanwhile, there is minor support at 1800, and major support at 1740 (the February lows).
Equity-only put-call ratios continue to remain on sell signals.
At face value, it certainly seems as if this new volatility product, the CBOE Short-Term Volatility Index (symbol: $VXST) will be useful and successful. In this article, we are going to look at all of the details (at least as far as they have been disclosed by the CBOE), as well as make some projections about how these new products might trade. These projections will be based partly on theoretical historic data, as well as what we know about how $VIX futures and options trade.
For the Introduction, an explanation of Expected Value, and Expected Value and Option Strategies, and Determining the Probabilities refer to Enhancing Option Portfolio Returns Using Probability and Statistics - Part 1,
The stock market finally halted its straight-down tailspin. A strong rally generated some oversold buy signals which could carry the market back towards its declining 20-day moving average.
The $SPX chart is negative, in a pattern of lower highs and lower lows, and that is what makes it bearish.
Equity-only put-call ratios remains negative. Thursday's rally did not impede their march upward, and when put-call ratios are rising, that is bearish for stocks.
We all know that trading options is exciting, highly competitive, and can be very profitable. The key to long term and consistent profits in option trading is options education.
You may not be aware, but Stan Freifeld of the McMillan Mentoring Program also directs our consulting services. It allows those who have questions regarding their options trading to have a professional trader provide insight, analysis and solutions to many trading situations.
Are you having fun yet? Volatility has returned, and the market is a daily dose of pain and pleasure, to either the bulls or the bears. There are plenty of cross-currents now, and in reality, volatility hasn't even increased all that much (statistically).
