I Will Never Roll A Losing Trade For A Debit
I will never roll a losing trade for a debit. Not when it feels right, not when the roll looks cheap, and not when I am convinced the position comes back. I roll for even money or for a credit, and I would sooner take the loss than pay to extend one. I have watched […]
911 million SpaceX shares unlocked today and it’s all BS
911 million SpaceX shares unlocked today and everybody is freaking out. It’s all BS. Let me walk you through why, because I’ve been on the inside of one of these and I know how it works. When SpaceX went public, 95% of the stock stayed with insiders and in the treasury. Only a small portion […]
Calls now cost more than puts in the biggest market on earth
The biggest options market in the world inverted yesterday. I want to walk you through what that means, because almost nobody outside the professional side is catching it, and it is going to matter to you whether you trade options or not. Start with the word skew. Skew is how calls are priced against puts, […]
Spectacular is not going to be good enough tonight
Spectacular is not enough when everybody already expects spectacular. Traders relearn this one every quarter. A company beats every number on the page and gets sold anyway, because the price already had the beat in it. The move comes from the distance between the result and the expectation, and the options market prices that distance […]
85 Advancers and I Was Looking for a Short
A perfect advance decline line is not always good news. This morning the market opened and the breadth was stellar. Holy crap, 85 advancers in the S&P 100. Full-blown correlation to the upside. Every sector was bid. Retail was up because it’s retail, materials hell yeah, healthcare back on that pony. Even the home builders […]
Asymmetry Is What Makes Me Trade
Asymmetry is what makes me trade. I wake up in the morning and I look for asymmetry in the marketplace all day long, and it has nothing to do with knowing where a stock is going. Friday morning Amazon had a $16 expected move. The stock moved 32 bucks. The expected move is the range […]
There Is Chum In The Water
The semiconductors are ripping and that doesn’t make Don feel warm and fuzzy. Don don’t feel warm and fuzzy that the semiconductors are rallying, because nobody gives two craps about them, and they’re going to come back in. They will sell the semiconductors again. Why, Don, why? Because there’s chum in the water, and when […]
I Lost 23 Cents And It Was A Great Trade
I bought the Microsoft 390 puts at a $1.22 and a $1.23. Closed them for a dollar. I lost twenty-three cents, and I’m counting it as a win. Here’s the thinking going in. We picked a product where, look, if the marketplace really tanks, Microsoft was going to get sucked down with it. Did that […]
The Heat Map Sucks
The heat map sucks. I’ll give you my specific gripe with the ThinkOrSwim one, which is that it counts Google twice because of the two share classes. I put a ticket in to have that fixed in 2014 and it still counts it twice, so I got that going for me anyway. The real problem […]
Why In Your Right Mind Would You Do That?
Everybody wants to tell you where this market is going. I think we’re going up. I think we’re going down. The Fed’s doing this, earnings are doing that. Every one of them is certain. So let me ask you a question. Why in your right mind would you go out and start to allocate heavy […]