The tastytrade network
Summary: The tastytrade network teaches investors innovative, simple ways to trade stocks, options, and futures, take advantage of market volatility and build a successful portfolio. Tom Sosnoff leads an irreverent and playful band of floor traders who are showing America a new way to quickly find low risk, high return strategies in bullish, bearish and sideways markets.
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Podcasts:
One way that we look to increase our number of occurrences is by trading earnings announcements. Earnings allow us to take advantage of high implied volatility (IV) in a one day, binary move. Since we know that IV tends to be overstated, these events provide us with an excellent opportunity to sell premium. Today, Tom Sosnoff and Tony Battista look at a huge study to see if selling a straddle is a viable strategy for earnings trades. The guys go back to 2007 through the present and take a look at 19 underlyings, all of which are trading under $100. They look at these lower priced underlyings because the margin requirement will be lower and thus, they can get a higher return on capital (ROC). After all is said and done, they find out that the straddle had over a 70% win rate. This translated into a total profit of over $9,000. One thing to keep in mind is that the biggest drawdown was around $600. Even after this large loss, the strategy was still very profitable and is a great way to take advantage of the high IV that accompanies earnings announcements!
Scott Snyder from TD Ameritrade joins us to discuss a variation of the collar.
tastytrade LIVE - October 3, 2014
On today's show, Ryan explains the difference between buying and selling call options, defines POP, analyzes an Iron Condor, and much more.
On today's show, Ryan explains the difference between buying and selling call options, defines POP, analyzes an Iron Condor, and much more.
The Pitch - October 2, 2014
Tim Knight begins the segment looking through underlyings, noting minimal action in gold and a pick up in the Euro. He tries to assess where there may be bounces, and stressed the importance of patience. Tom and Tony take over, discussing their scalps, covers, and closes from the day. Then, Tom provides a "market awareness" pitch, and some interesting statistics on age of investors.
Case has the reigns today, and she wants to talk Straddle Defense and Management!Recapping her original trade in PBR, which was a neutral straddle, meaning they shorted the ATM Straddle. Additionally, Case explains the change in her delta following the testing pf her position. She mentions that to achieve a max profit, she would like to have a net delta position of 0. Her and Tom then go through step by step rolling straddles to reduce directional risk, to extend duration, and how to calculate target profit following these defensive and management tactics.
Case has the reigns today, and she wants to talk Straddle Defense and Management!Recapping her original trade in PBR, which was a neutral straddle, meaning they shorted the ATM Straddle. Additionally, Case explains the change in her delta following the testing pf her position. She mentions that to achieve a max profit, she would like to have a net delta position of 0. Her and Tom then go through step by step rolling straddles to reduce directional risk, to extend duration, and how to calculate target profit following these defensive and management tactics.
Todays Trades of the Day: SPX off of trend line touch and ES futures bought at a VPOC!
ShadowTrader Uncovered - October 2, 2014 - SPX Touching Trend Lines and Reversing
Slim and TP get in a discussion about trends and normal distributions. Slim believes in trends while TP believes more in randomness, option magnitude and normal distribution. They both choose a call spread trade in HPQ.
Slim and TP discuss the recent change in market direction and the opportunity for 2-way trade in the markets. TP addresses the huge price and volatility swings of the oil markets, and how they might be impacting the broader markets. Slim and TP both decide to put on a bullish trade in CVX but using different strategies. TP decides to sell out of the money naked puts and Slim went long in the money calls.
Slim compares the world of surfing to the world of trading. Great surfers spend a lot of time in the water, and in all conditions, up to 250 days a year. They try to have strong balance and work on their coordination for "quick reactions". Surfers always try to ride out the "huge wave" and stay close to the power of the wave and eventually attack the wave. They begin to see patterns in the waves and try to use the energy of the wave to their advantage. Slim explains how these traits can help your trading.
Ask SLM - October 2, 2014
