How to Trade Volatility
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Volatility was at an extreme this week with this markets dropping 7%. What should you expect next week? And, what should you be looking at? After 15 years in the brokerage industry I know that retail investors do the worst during periods of market volatility. In the midst of volatility everything may feel like you’re doing is wrong. Every trader on the street will be talking about selling the rally. Indices will drive stocks so focus on the indices. In this type of market you want to choose spreads. Any directional option, a call or put, can lose money even if you’re right. You never wanna be in a position where you’re right and still lose.
