• VIX | Trader Talk | Trade Ideas | Sep 3, 2016, 10:31 AM

    Weekend Review - VIX Futures and Options - 8/29 - 9/2

    Weekend Review - VIX Futures and Options - 8/29 - 9/2

    VIX finished the week just under 12.  We can attribute this to a combination of the equity market being pleased by Friday’s August Non-Farm Payroll report along with the three-day weekend effect.  Note the September futures, which settle on the 21st moved lower, but held up a bit relative to spot VIX.  This is common regardless of the directional move out of the index, but is accentuated whenever we have a long weekend. Despite there only being one trading day (and[...]

  • Market News | Sep 2, 2016, 1:54 PM

    The Weekly Options News Roundup – 9/2/2016

    The Weekly Options News Roundup – 9/2/2016

    The Weekly News Roundup is your weekly recap of CBOE features, options industry news and VIX Index and volatility-related articles from print, broadcast, online and social media outlets. Global To Global Students from Northwestern University’s Kellogg School of Management Global Executive MBA Network visited CBOE on Wednesday.  The group, which included international students and alum from Beijing, Hong Kong, Tel Aviv, Toronto and Germany, as well as the U.S., toured the trading floor[...]

  • Market News | Trader Talk | Trade Ideas | Aug 31, 2016, 6:57 PM

    Earnings Next Week - 9/6 - 9/9

    Earnings Next Week - 9/6 - 9/9

    Due to the short week we only have three stocks with Weeklys available for trading reporting earnings.  As always the data below is based on the last three years of earnings results unless the ticker is in italics.  The columns show the biggest rally, biggest drop, average move, and what the stock did last quarter in reaction to earnings.

  • Market News | VIX | Futures | Aug 31, 2016, 4:21 PM

    Sept. 22 Webinar - Institutional Investors and Case Studies on Use of the VIX

    Sept. 22 Webinar - Institutional Investors and Case Studies on Use of the VIX

    On Thursday, September 22 at 2:00 p.m. E.T., S&P Dow Jones Indices and CBOE will co-host a complimentary webinar for financial professionals on the topic of -- How are Institutional Investors Using the VIX®?  Financial professionals who wish to register and see more information are welcome to visit this link -- http://bit.ly/VIX-Sep22. Featured institutional investor speakers will be: (1) John Burkhartzmeyer, State of Wisconsin Investment Board (SWIB); (2) Scott Maidel, CFA, CAIA,[...]

  • VIX | Trader Talk | Trade Ideas | Aug 30, 2016, 7:45 AM

    See a Profit, Pick it Up

    See a Profit, Pick it Up

    She sells short shares down by the SVXY shore... Or something like that goes the nursery rhyme.  But does she buy calls to go with those shares?  Probably not. Here's why I did it: I wanted a chance to benefit from the SVXY downside I envisioned without worrying excessively about the potential penalty for being significantly unfortunate in my timing/prediction.  So, feeling confident that my dream of SVXY put through the macerator would come true, I decided on a price I'd be willing[...]

  • Market News | Trader Talk | Trade Ideas | Aug 29, 2016, 4:55 PM

    Trade Analysis - Short Term Bullish Spread With SPX Monday Weeklys

    Trade Analysis - Short Term Bullish Spread With SPX Monday Weeklys

    On Friday I received an email from a student who had recently attended one of the CBOE Options Institute courses.  They (I’m gender neutral to protect their identity) wanted to let me know that they had made the jump into SPX Monday Weeklys.  With the S&P 500 at 2166 they expressed a bullish outlook with respect to the stock market through initiating a bull call spread.   The specific trade involved buying the SPX Aug 29th 2160 Call for 10.80 and selling the SPX[...]

  • Market News | Education | Aug 29, 2016, 12:52 PM

    Turn Up the Volume

    Turn Up the Volume

    As we wind down the dog days of summer, the usual complaints are heard daily about markets:  volatility is low, the markets don't move, volume is pathetic, the action is too thin to trade.  Well, I can certainly understand the concern, and with a VIX settling in just under 14% for nearly two months, that is indicative of a sleepy market.  We are trained to believe the markets are vulnerable to downside when participants show complacency, and that has certainly been the case since the[...]

  • Technical Analysis & Charts | VIX | Futures | Aug 29, 2016, 11:26 AM

    BigTrends.com Weekly Market Outlook - August 29, 2016

    BigTrends.com Weekly Market Outlook - August 29, 2016

    Unable to resist the weight of its 9% gain since its late-June low, the S&P 500 (SPX) (SPY) finally started to buckle last week. The index only lost 0.68% for the five-day span, but that was the worst weekly performance since June, and could end up serving as the profit-taking excuse some traders have been waiting for. We'll look at the matter in more detail after a closer look at last week's and this week's economic numbers. They matter more than usual now, with the prospect of rising interest[...]

  • Market News | VIX | Trader Talk | Trade Ideas | Aug 28, 2016, 12:24 PM

    Weekend Review - VIX Futures and Options - 8/22 - 8/26

    Weekend Review - VIX Futures and Options - 8/22 - 8/26

    VIX rose a whopping 20% last week, although that is a jump off a pretty low base.  This was in response to the S&P 500 dropping only 0.68%.  Note the curve didn’t replicate the VIX move since the futures were already discounting higher volatility.  Stated another way, the steep contango dissipated a bit as spot VIX narrowed the spread with the nearer dated futures. At least one trader appears to be expecting a further run in VIX over the next few weeks. [...]

  • Market News | VIX | Trader Talk | Trade Ideas | Aug 27, 2016, 7:30 PM

    Weekend Review - Volatility Indexes and ETPs - 8/22 - 8/26

    Weekend Review - Volatility Indexes and ETPs - 8/22 - 8/26

    The short end of the VXST – VIX – VXV – VXMT curve rose last week as volatility moved higher in reaction to comments coming from the annual get together in Jackson Hole.  The result is a bit less steepness in a curve that has been pretty darn steep the past few weeks. The long volatility funds got a small reprieve from the severe downtrend in performance that has been in place since the first quarter. SVXY gave up some performance last week and VXX along with[...]

  • Market News | VIX | Trader Talk | Trade Ideas | Aug 27, 2016, 4:25 PM

    Weekend Review - Russell 2000 Options and Volatility - 8/22 - 8/26

    Weekend Review - Russell 2000 Options and Volatility - 8/22 - 8/26

    The Russell 2000 (RUT) widened the 2016 performance lead on the Russell 1000 (RUI) last week.  RUT rose 0.11% while RUI was down 0.67%.  For the year RUT is up 8.99% while RUI is up around 6.17%.  What is sort of missed is the relative performance since February’s lows.  RUT has gained 29.8% while RUI is up only 19.5% since the market bottomed earlier this year. Expected volatility rose last week but the gap between the CBOE Russell 2000 Volatility Index (RVX)[...]

  • VIX | Trader Talk | Trade Ideas | Aug 27, 2016, 11:08 AM

    Happy VIX-entines Day

    Happy VIX-entines Day

    The funniest part of my last post was the quote from my last sentence, "...VIX, which I doubt will stay the same every minute from here on out..." because it has basically stayed right where it was at the time of that writing more than a month ago.  Spanning 11-13 that day set the tone for the next month, since that's all it's done ever since (with the exception of a toe dipped in 14 yesterday), for the next 25 trading days. (*And excepting today as I've been sitting here writing this,[...]

  • Market News | Aug 26, 2016, 4:33 PM

    The Weekly Options News Roundup – 8/26/2016

    The Weekly Options News Roundup – 8/26/2016

    Options Strategy ‘Put’ In Perspective Traders in the S&P 500 Index option pit at CBOE in June.  Photo: Getty Images Pension funds are increasingly beginning to use the CBOE S&P 500 PutWrite Index (PUT) as an efficient means to garner income while providing a “cushion” from volatility during market downturns. The PUT strategy is designed to sell a sequence of one-month, at-the-money, S&P 500 Index puts and invest cash at one- and three-month Treasury Bill[...]

  • Market News | Trader Talk | Trade Ideas | Aug 25, 2016, 7:51 PM

    Earnings Next Week - 8/29 - 9/2

    Earnings Next Week - 8/29 - 9/2

    Next week we have a small list, but it's an interesting one as several of the companies reporting have recently had a big move or just regularly experience a lot of volatility around earnings.  As always the data below is based on the last three years of earnings results unless the ticker is in italics.  The columns show the biggest rally, biggest drop, average move, and what the stock did last quarter in reaction to earnings.  

  • Market News | Trader Talk | Trade Ideas | Aug 24, 2016, 11:15 AM

    The Buffett Put Trade - 2Q2016 Update

    The Buffett Put Trade - 2Q2016 Update

    Each quarter Berkshire Hathaway, like all investment firms, files their holdings with the SEC.  Most people scramble to see what stocks Warren Buffett has been adding to his portfolio.  I usually scramble as well, but I’m looking for something hardly discussed in the dozens of pages that make up Berkshire Hathaway’s 10-Q.  I go looking for an update on what I commonly call The Buffett Put Trade.  Back in April I wrote an explanation of what this trade is all about. [...]