Listen "Option Block 781: Talking VIX and Playing Fortnite"
Episode Synopsis
TRADING BLOCK Another mixed day of the street. EA bouncing back after Fortnite crash and Apex rally. Earning Highlights this Week: Monday - Aurora Cannabis (ACB) Tuesday - Activision Blizzard Wednesday - Cisco Thursday - Nvidia, The Coca-Cola Company, CME Group, Cannabis Growth (CGC), Applied Materials Friday - PepsiCo ODD BLOCK Near-term ITM call love in Electronic Arts Inc (EA) Call love in CBS Corporation Common Stock (CBS) More paper trading in Centurylink Inc (CTL) MAIL BLOCK #QOTW - $VXX is dead! Long Live $VXXB! There's a (somewhat) new kid on the #Volatility trading block. Are you trading $VXXB #options yet? If not, how are you getting your #Volatility fix these days? $VIX $TVIX $SVXY - Yes: Jumped into $VXXB - No: Spreads are too wide - No: Prefer $TVIX, etc - No: Prefer $VIX #options Question from Dave B. - Hi, I have a question about what is the best strategy to use for my trading system. I typically am only right on about three or four trades out of every 10 with long stock. The trades that I am wrong on, I take a small loss - somewhere between 5 to 10% but only 1-2% of the total capital as I typically take 10% positions. The trades that I am right on, I typically make 50% up to 200% over a 3 to 12 month period. I want to find an options strategy to increase returns via leverage, but keep total portfolio risk per trade about the same. Would DITM calls or spreads make sense to you? Or is there another strategy I could (should) consider. Thank you! Dave B. Sent from my iPhone Question from LLAZ - What do you think of call verticals in $USO here? Maybe 3-month 5 or 10% otm? Worth financing with a put? Question from DaQuinta - I've been lured in by the ongoing selloff in crude oil and I'm thinking about setting up a longer-term stock replacement strategy in the USO ETF. I have a couple of questions: A.) With $USO dropping below $11 is it even worth doing or should I just buy the shares instead? Is there a certain threshold where stock replacement stops making sense? B.) My proposed construction is an almost six-month strategy with July 8 Calls for $3.10. So my outlay for 100 shares is $3100 versus $10,800. C. Is it even worth selling a Jan 11.5 call and limiting all of my upside just to collect $.15 or should I keep it open from here? AROUND THE BLOCK This Week's Economic Reports Feb 15: Import and Export Prices, Industrial Production, Business Inventories, Consumer Sentiment
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