OptionStrat Blog

Nvidia -- My Two Cents

Nvidia was a Wall Street mega darling even before its incredible results were announced last Wednesday night. Since then...

The VIX: Beware!

I'm asked frequently why the VIX doesn't seem to rally all that often or all that much. I tackled this question last October in a blog entitled The VIX: Hope Springs Eternal!

The Magnificent Seven

Not a day goes by lately that you don't hear about the performance of the Magnificent Seven. Nvidia (NVDA), Meta (META), Amazon (AMZN) and Microsoft (MSFT) are up an astonishing...

LNG Uncertainty

I've written several times about Liquified Natural Gas (LNG) and the world's second largest producer, Cheniere Energy (ticker = LNG, conveniently and confusingly).

Only Gold

It was 176 years ago last Wednesday that gold was discovered at Sutter's Mill in California. Despite the fact that it gets very little notice, the discovery triggered the gold rush...

SAVE Us!

I'm talking about Spirit Airlines (SAVE), and just couldn't resist the pun. As you probably know if you follow the airline sector, Jet Blue's proposed...

Uranium is Glowing

Yes, uranium. If you're looking for an esoteric investment play that will dazzle your friends, this just might be the thing!

Buying Disaster

It's every flyers worst nightmare: a part of the plane blows off in flight and leaves a gaping hole in the fuselage. Open, blue skies and the wind rushing through the cabin is not exactly what most passengers want to experience during a flight.

Stocks vs. Bonds, Who Wins?

To begin, allow me to wish you and yours a happy, healthy, and prosperous 2024! In my last blog, last year, I noted that it has become an almost unanimous opinion among many investors that stocks easily outperform bonds

The Doomsday Book

One story that came out last week but did not gain a lot of attention was the release of the "Doomsday Book" by the NY Fed.

Terror Trading?

On December 4, two law professors, Robert J. Jackson, Jr of NYU and Joshua Mitts of Columbia, issued a pre-print study (i.e., not peer reviewed) entitled Trading on Terror? In the Introduction, the authors write:

Too Low?

A recent market development that should be getting more attention is the seemingly endless slide of the VIX. For those of you who aren't familiar with it...

LNG: A Downside Emerges

Most Americans don't know it, but Europe had a full blown energy crisis during the Fall and Winter of 2022. I wrote about it in August of that year (European Issues) and several times since, focusing on opportunities in the energy sector, specifically liquified natural gas (LNG).

Bitcoin: The Dream Lives On?

As is its habit, Bitcoin is back in the news lately. Bitcoin futures have been rallying, almost without a break, since the beginning of the year.

Athleisure?

Looking around after boarding a plane recently, I had to ask: does anyone wear real pants anymore? Not that I'm nostalgic for the era when people got all dressed up to fly, but the answer seems to be no.

Green Energy and Red Ink

It's important in investing not to let preconceived notions get in the way of real world economics and financial results. A great example of this is what I...

Supply and Demand: Inescapable

This week, an update on two completely unrelated blogs I wrote previously, More Teslas?, 11/21/2022, and Orange You Smart...

0DTE Options: Straight Talk

If you've been trading options for the last few years, then undoubtedly you've read all about the explosive growth of 0DTE options and have probably even traded them for yourself.

War, Again and Again

I had intended to write this week's blog about 0DTE options and their effect on the market. Sadly, the war in the Middle East is now center stage.

The VIX: Hope Springs Eternal!

If you follow the VIX (which you should if you trade options), you know that it hasn't been that exciting lately. As I've heard many traders...

Green Risk

In July, I wrote about sustainable aviation fuel, or SAF (Overpriced SAF?). It's not the most exciting topic in the world, but it does display one possible hazard...

Energy

It just caught the attention of the non-energy markets and popular press that crude oil has been rallying since last June. In general, if crude has a shot at breaking $100...

Uranium?

For those of you who have moved on from conventional and dirty fossil fuels, uranium might be of interest. Uranium is the primary source of nuclear power...

Nostradamus, Not!

For new traders, it's very tempting to think that someone has figured out the market and can predict it's every twist and turn (or at least 51% of them)...

Retail Zombies

One of the longest-lasting effects of Covid is the way people buy things. Unwilling to leave the house, people naturally pivoted to fulfilling their needs online...

Just a Few Stocks

In a 2017 paper by Hendrik Bessembinder the author analyzed common stock returns from 1926 - 2017. The results are surprising:

Memes are Back

Apparently, trading by individual investors is still going strong. Although it seems that most have moved on from their dreams of...

Storage Wars!

Here's a crazy statistic: researchers estimate that 1 in 10 Americans lease storage space. Some report that it's even higher, at 20%...

Let's Fly!

Last week, I flew for the first time in several months. As a consultant, I used to fly about once a week...

Overpriced SAF?

Although most people take them for granted, large commercial airliners are pretty incredible machines. Take the Airbus A380, the largest...

Whoppers!

I went to McDonald's (MCD) last weekend for the first time in a few years and it was a different place than I remember. First off, there were no employees to greet and take orders -- electronic kiosks do all that now.

It's Hot!

One of the most underappreciated and mundane inventions of the 21st century is air conditioning. Although it rarely makes it to anyone's Top 10 Inventions list...

The Coup That Wasn't

When asked how he went bankrupt, Hemmingway famously replied, "Two ways. Gradually, then suddenly.”...

Remember WeWork?

My son, who has a real day job but trades stocks on the side, pointed out to me the other day that WeWork was trading at $0.23 cents. Frankly, I didn't even know that WeWork...

Cruisin'!

I wrote about cruise lines last December and at the end of May (Cruises are Back!), the gist being that they were beaten down by Covid...

There's Money in Garbage

For those looking, the waste disposal industry has been getting a lot of attention lately. Why the sudden interest? Because collecting garbage is no longer about just taking out the trash...

Cruises are Back!

Last December, I wrote about cruise lines and how they were almost destroyed by Covid (Let's Take a Cruise). The outlook at the beginning of the pandemic was pretty bleak.

Weighty Matters

I'm not a diet person, but I couldn't help noticing that some relatively new weight loss drugs have been getting a lot of attention from entertainment and social media types. The drugs...

Something to Worry About, Part 2

Last week, I wrote about the intensifying debt ceiling crisis (Something Real to Worry About, No Kidding!) and that the equity markets don't seem to be taking it too seriously.

Something Real to Worry About, No Kidding!

Last February, I wrote about the debt ceiling in Something to Worry About. In it, I noted that "...as we get closer to June or financial insolvency, the greater...

Dogs

A dog health food store recently opened up near where I live. They sell all the usual stuff that you can find in any Whole Foods, only the canine version...

Dream On

This week, I'm going to concentrate on some dreams that people have and the likelihood of them coming true. I've covered some before, and some have only appeared recently...

LNG, Again

Being a commodity and energy guy, one of the companies that I follow regularly is Cheniere Energy (LNG). I've written about them frequently, most completely last September in...

All That Glitters?

The precious metal, and its digital cousin, Bitcoin, benefited from the SVB crisis, which confirmed the worst fears...

New Look & New Options Model

We’re excited to announce the launch of our new branding for OptionStrat, as well as a new and improved options model to power our predictions.

Crudely Speaking

It's been a long time since an OPEC meeting completely surprised the oil markets. There are just too many people associated with the organization...

It's NOT 2008!

People tend to think that whichever disaster they lived through personally was either the worst and most earth-shattering in history or a close contender. Hence, the usual...

Wanna Bet?

Most of you are probably sick of reading about the banking crisis by now. I know I am. Let's discuss something more interesting, or at least more fun: how to make money on sports betting without ever placing a bet.

Black Swan

I would be remiss if I didn't comment on the latest event roiling financial markets, the sudden death of Silicon Valley Bank, the near death of Credit Suisse, and the derisking affecting markets worldwide.

Orange You Smart

Believe it or not, Orange You Smart was a TV ad campaign from the early 80's promoting Florida citrus. I thought of it...

Hopes and Dreams

This week, let's review some companies that succumbed to dreaming instead of managing.

Split Strikes

A few blogs ago, I recommended watching the new Madoff documentary on Netflix. By now, most of you know the story, but it does bring to light some details relevant to investing and options trading that are worth reviewing.

The Crypt Keeper Emerges

I mentioned a few weeks ago that Bitcoin was starting to show some life after its near-death experience during the crypto meltdown (Surprise! Crypto Might be Back!).

Gold Bugs and the Debt Boogeyman

Traders generally fall into one of four categories on Wall St: equity, bonds, foreign exchange, or commodities. Sure, there is some crossover, but that's about it...

Tesla, ONE More Time

Last week, I wrote about everybody's favorite, Tesla. Since I'm an options guy, I was quick to admit that I had no special insight on the stock's fundamentals. However, being a recent EV shopper...

Tesla, My Two Cents

This week, I'm going to start by writing about one of the most covered stocks in the history of man, Tesla.

Ark, Again

I wrote about Cathy Wood's ARK Innovation Fund earlier in the month (2023). Coincidentally, a long-time friend of mine...

LNG Results: A Mixed Bag!

Cheniere Energy is the world's second largest producer of liquified natural gas (LNG). Due to the Ukraine war and the disruption of natural gas supply, LNG is now a vital component of Europe's energy supply...

2023

To begin, a healthy, happy, and prosperous new year to one and all! I'm going to start the new year by looking back at some stocks I covered in 2022 and see if we can learn anything from them.

Straddlers Beware

Last week, I demonstrated the Visual Greeks feature of OptionStrat using Cheniere Energy (LNG) as an example. To refresh your memory, below is LNG's price and volatility action for 2022.

Visual Greeks and LNG

There are two ways to play Cheniere, short and long term. If you believe that the mild European winter has relieved their energy crisis, then it follows that LNG might break out to the downside...

With Enough Money

It seems that most people have forgotten that there's still a war in the Ukraine and it continues to influence energy prices. As Americans...

Let's Take a Cruise

I read an article a few days ago about a giant rogue wave that hit a cruise ship, just like in the Poseidon Adventure! If this happened in March 2020, right at the beginning of Covid...

Is Crypto Dead?

Perhaps the biggest financial story of 2022 has been the implosion of the crypto market. FTX and Sam Brinkman-Fried...

More Teslas?

This week, I'm going to concentrate on electric vehicle manufacturers other than Tesla. Rivian, Lucid, Fisker, Nikola, and Lordstown, if not exactly household names...

Pros are Different

I often write about individual stocks that I think are interesting, mispriced, or in the news. Sometimes, they just have cool names that merit investigation...

Meta and Snap: The Undead

I'm not crazy about unanimous opinions, especially when it comes to stocks. Usually, the situation isn't as bad (or as good) as the consensus indicates. Recently, Meta and Snapchat both...

Rockets for the Future

This week, I'm keeping up my review of futuristic, disruptive stocks whose business models or products were a figment of someone's imagination just a few years ago.

Flying Stocks!

I think anybody that has ever been stuck in traffic has thought how cool it would be to own your own personal flying machine.

PTON Anyone?

Who would have predicted that two years ago, at the height of the pandemic, and with PTON trading over $160, that it would now be trading under $9 bucks

Swiss Mess

If you follow juicy Wall St. scandals, as I do, Credit Suisse's latest nosedive shouldn't have come as a surprise.

Dr. Doom

Engineered meat has less than 1% of total market share for meat products in the US. Coupled with the failure of...

Event Options, Avaya!

Last July, I wrote about the CME's latest wunderprodukt, Event Options. At the time, the exchange was seeking approval from the CFTC to launch. It was granted, and last Monday, September 19th, was the first day of trading.

The War's Not Over

Despite Ukraine's recent gains, a military solution to the conflict is unlikely. Both sides will eventually seek negotiations.

Europe. Bring a Good Coat, Maybe!

The gathering storm in Europe is even more serious than when I last wrote about it a few weeks ago. EC energy ministers are getting together this Friday...

Revenge of the Memes

Two meme stocks in the news, AMC and Bed, Bath, and Beyond, are trading at triple digit implied volatility levels...

European Issues

Europe has a full-fledged energy crisis on its hands. Consequently, liquified natural gas prices are soaring and have increased over 7 times from a year ago.

New Greek Visualization Features

Premium members can visualize how greeks evolve over time, with volatility changes, and with underlying price changes.

Risk Management for Dummies

Numerous studies have come to the same conclusion: you can't time the market. You might be able to every now and then, but it's extremely rare to beat the market consistently and in the long term.

Beware of the "It's Cheap!" Trap

At one point in my career, I was the risk manager for an absolute return hedge fund. For those of you who aren't hip to cool kid hedge fund lingo...

Tales from the Crypt

This week, I thought I would check in on some stocks that I have reported on previously, as well as one newcomer. I warn you now, it's a depressing bunch...

Inflation: Not So Fast!

It's unanimous: inflation is going nuts and is the highest it's been since the 70's! Most people can't relate to this since they weren't even alive in the 70s...

Event Options: Viva Las Vegas!

If you're familiar with sports betting, you will be very comfortable with Event Options. Here's how they work.

The Dollar, Again

As I wrote last week, the dollar continues to be the king of the FX forest and has soared to roughly 20-year highs against the Euro and Japanese Yen.

All Hail the Dollar!

With all the news about inflation and gas prices and various other depressing news, the incredibly high value of the dollar has largely flown under the radar.

Visiting Some Old Friends

Some of my previous blogs focused on the so-called Covid Darlings, the stocks that benefited from Covid, but are now subject to extreme selling pressure.

ARK Just Ain't What It Used to Be

Cathie Wood's ARK Innovation ETF skyrocketed to mass popularity when it delivered a solid 35.7% return in 2019 and then followed up with an eyepopping 156.6% in 2020.

Trees Don't Grow to the Sky!

Last week, I attended a derivatives conference in Las Vegas (Quants in Vegas, an interesting combination). Like all conferences, it was a chance to see and be seen and to check out what everybody else is thinking.

Crypto Shenanigans

As you know, lately I have been writing about cryptocurrencies and how they have not been acting as advertised (to say the least).

Shocking!

Last weekend, a horse aptly named Rich Strike won the Kentucky Derby. Believe it or not, he was an 80-1 long shot.

Apocalypse Now?

This week, the tone of the markets took on a decidedly apocalyptic tone. Inflation, war, interest rates, Covid, stagflation…the list goes on and on. I

Covid is Over?

Apparently, a federal judge in Florida has decided for all of us that the pandemic is officially over.

Pay Attention to Nickel!

Imagine that one day you're trading away in a pretty quiet stock and all of sudden it goes up 66% one day and then doubles the next over the course of 18 minutes.

Ceasefire Ruminations

You can’t get much more uncertain than how the Russian/Ukraine situation will ultimately turn out.

Geopolitical Shocks Are Not That Shocking!

I fully believe that financial history doesn't really repeat itself, it just kind of rhymes with what we've seen before. In other words, reminiscent, but not a replay, a sequel if you will.

Options Calculator Improvements

Today we are launching a series of improvements to our options profit calculator product known as the strategy builder.

Covid Volatility

The bull market party has been going on since roughly 2009 (and who would have predicted that at the very bottom of the...

Introducing the Options Optimizer

The new options optimizer allows you to easily search though thousands of trades to find the strategies with the maximum return or chance of profit.