The yen is a good trade due to its low value and high volatility, with the speaker planning to sell puts and possibly calls.
volatility is high and stock is expected to move $21
iron condor is delta neutral and has no directional risk
Tom's favorite trades of the week include Apple short strangle, hood short put spread, SMH short iron condor, and coin short put.
selling naked puts on SPY is a strategy that can be used to get long exposure to the stock
being consistent with duration and mechanics is key
The refinancing of low-rate corporate debt could have significant market implications, potentially leading to volatility and affecting various sectors, including tech and financial markets.
The speaker believes the war is off before it even started, and mentions that oil prices have dropped by $6, which affects the rally.
The 30-year average for mortgage rates is around 5% to 5.2%, with the speaker noting that it was closer to 7% in the early 80s and late 90s.
The speaker acknowledges that averaging down on losing option trades is not a hard rule and can make sense in certain situations. They mention that they have done it, but it's not a habit. They also note that averaging down on winning trades is not common.
The market was selling off due to bonds and other factors, but there was more to it that wasn't visible. The situation is compared to a past event where a hedge fund manager's fund was blown out, leading to a market turnaround.
The speaker would have considered putting money into the deal if Ken Griffin had called, but he would have been cautious and not necessarily invested directly.
The US Treasury's support for the Japanese yen is a symbolic move, not a significant financial commitment. It may be slightly bullish for bonds but not for the dollar or euro.
The expected move is $21.
No, the expected move is based on the options implied volatility, not open interest.
The speaker suggests that even if liquidity or volatility becomes skewed, markets won't get too wide during the day. High-frequency firms have handled such situations, and models are based on normal liquidity. If spreads do widen, a contrarian approach could be taken, but it's unlikely. The speaker advises not to trade with the idea of 'monsters under the bed' and to focus on liquid products where you can trade both sides.
Tom's favorite trades of the week include Apple short strangle 43%, hood short put spread 20%, SMH short iron condor 9 19%, and coin short put 18%.
The short interest in Peloton stock increased from approximately 111 million shares at the end of June to 165 million shares as of July 15, representing a 40% increase. More recent estimates suggest the short position is higher, though the short float percentage varies depending on how the tradeable float is defined.
The speaker manages a family portfolio as a single book with positions based on Netflix, making it more manageable. They suggest keeping things simple and not rolling trades.
The speaker suggests that covering the trade covers all the risk and that there is nothing else to think about. However, the speaker also suggests that rolling the trade out and either up or down can reduce some of the risk of the trade.
The bill has passed the House in July 2025 and the Senate Banking Committee advanced its version in May 2026 by a 15-9 vote. However, the full Senate has not voted yet, and it is being held up due to concerns about internal processes. The Senate Majority Leader John Thoon indicated that passage before the August recess was unlikely, but the floor process might begin. The midterm calendar leaves little room for a Senate vote and reconciliation with the House version.
The speaker has a small position (one to three percent) in cryptocurrency, the same for the last 10 years. The other person does not have any position.
Staying small is the primary defense against large market swings. Position sizing should be between 1-5% or 6% of your account, with 3% as a barometer. It's an art, not a science, and you need to stay comfortable with your risk tolerance.
You can be wrong and still make money.
The speaker suggests using between 25 and 50% of a portfolio for margin, adjusting based on volatility. When volatility is higher, they recommend closer to 50-60%, and lower when volatility is lower. They also mention that for larger accounts, the percentage should be lower, such as between 15 and 25%.