Options

IWM Russell 2000 Options Trade Review: Short-Strangle

Last week I posted a Case Study looking at a couple of Short Strangle options plays with IWM. The idea behind the case study was to see how the trades would perform and follow their progress. Again, this was with the iShares Russell 2000 ETF (NYSEARCA:IWM). After such a strong rally following…

Options Trading Idea: Starbucks (SBUX) Bear Put Spread

The U.S. equities market has gone straight up since the unexpected victory by President-elect Donald Trump earlier this month. Trading volumes have been on the rise and long-term investors have benefited from an increase in their 401K balances. The recent price action has brought about other opportunities for traders. As money…

5 Important Market Charts From Today’s Trading Action

Friday’s trading session began with an oversold bounce.  Although the markets weren’t near correction territory, they had been seeing a lot of selling lately.  The S&P 500 Index (INDEXSP:.INX) was down 8 days in a row coming into Friday. So a bounce felt overdue. Well, the S&P 500 kept its streak alive….

Options Traders Ramp Up Put Buying As Market Fears Rise

Complacency is finally abating as options traders ramp up their put buying. On Tuesday, we noted that the sentiment climate had finally shifted away from its overly bullish or complacent condition. This rampant bullishness had us concerned about the downside risk in the stock market starting back in August (e.g.,…

Biotech Sector M&A Breakdown: Stocks To Watch

The Biotech Sector (NASDAQ:IBB) has been volatile the last few weeks, more so than the market at least with two opposing forces. On one side, sell-offs look to be election related on fears of further scrutiny on drug pricing weighing on future profits, and on the other side, a growing…

Understanding The VIX: Now And Throughout Stock Market History

The VIX Volatility Index (INDEXCBOE:VIX) is back in the headlines. Also known as The Fear Index, the VIX is arguably the most over-analyzed tool on Wall Street regarding its real-world predictive powers relative to the long-term path of the stock market (i.e. the S&P 500 Index: INDEXSP:.INX). Today we’ll spend some time…

VIX Volatility Index Showing Near-Term Staying Power

Welcome back, volatility. The VIX Volatility Index (INDEXCBOE:VIX) jumped again yesterday as investors were whipped around for another day. Following 43 days spent within a narrow trading band (a total range of 1.75%), the S&P 500 Index (INDEXSP:.INX) has now had three consecutive days with moves in excess of 1.5%. With…

ISEE Call Put Ratio Hit Lowest Level Ever… Huh?

Options data from the International Securities Exchange does not corroborate the frothy readings seen in most other sentiment measures. Is the ISEE Call Put Ratio an outlier? We’ve mentioned several times in several different outlets that perhaps our biggest concern regarding the stock market presently is overheated sentiment. From professional…

VIX Shorts Near Extremes: Time To Protect Your Investments?

In our latest research article “Market Complacency Ruling The Day Into U.S. Election” we highlighted that complacency in the stock market, as measured by the VIX Volatility Index (INDEXCBOE:VIX), is at levels rarely seen. On its own this is not breaking news, but it is very strange when contrasted with…