LD Lossdog Research
topic

options strategy

10 matching records.

Insight

Strangle Strategy with Expected Move

The speaker outlines a strategy for trading strangles by buying long wings at the 30-day expected move, while selling the zero-day. This approach is based on extensive backtesting and research, with the idea that adjustments are only necessary on days with significant price movements (over 1/2%). The strategy emphasizes the importance of expected move levels and the minimal long-term difference between staying in the zeros or adjusting.

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Applicable when
  • 30-day expected move levels
  • significant price movements (over 1/2%)
Limitations
  • Adjustments are required on days with significant price movements
  • The strategy is not suitable for all market conditions
options strategy
high confidenceVerify in video at 23:11 ↗
Insight

Strangle Strategy for Tesla

The speaker recommends selling strangles in Tesla, with calls twice as far out of the money as puts. This strategy leverages the call skew in the market, which is expected to be significant. The rationale is that the stock is currently trading at $413, with puts $63 away and calls $87 away, indicating a potential for higher volatility on the call side. The practical implication is that this strategy should be executed with careful consideration of the implied volatility and the potential for market movements.

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Applicable when
  • call_skew
  • volatility
  • strangle_strategy
Limitations
  • requires accurate volatility assessment
  • market movements can invalidate the strategy
  • call skew may change over time
options strategy
high confidenceVerify in video at 37:16 ↗
Insight

Consistent Options Strategy

The most consistent and recommended options strategy for overall yearly gains is selling naked puts. This strategy is highlighted as providing 'free money' over a period of 16-17 years since 2009, with minimal risk and consistent returns. The rationale is based on historical performance and the ability to generate income with low risk.

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Applicable when
  • long-term investment horizon
  • low-risk appetite
  • market stability
Limitations
  • Requires sufficient capital to cover potential shortfalls
  • Not suitable for volatile markets
  • Regulatory and margin requirements may apply
options strategy
high confidenceVerify in video at 45:55 ↗
Q&A

How can one construct a trade for Apple and Microsoft given their IV levels?

The speaker suggests using a poor man's covered call strategy for Apple by buying a long-term LEAP at the money and selling a front-month call. For Microsoft, the speaker is not long and suggests a long-term trend-following strategy instead of selling puts.

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Actionable takeawayUse a poor man's covered call for Apple and consider a long-term trend-following strategy for Microsoft.
AAPLMSFToptions strategyTrading Strategy
high confidenceVerify in video at 21:19 ↗
Q&A

If you had to build a simple rules-based core plus options satellite portfolio for the next three to five years, what would you put in the core and what would you sell options on in the satellite portion and why?

The core portfolio should be tailored to individual preferences, with the satellite portion involving writing calls against longs and substituting some longs with short puts to lower basis. The rationale is to improve basis through strategic options positioning rather than relying solely on dividends.

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Actionable takeawayFocus on strategic options positioning to lower basis, rather than relying solely on dividends.
options strategy
high confidenceVerify in video at 00:30 ↗
Q&A

What is your favorite stock trade?

The speaker's favorite stock trade is Netflix, as they have recently executed a similar trade and believe in the stock's potential for a short put spread.

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Actionable takeawayThe speaker favors short put spreads on Netflix, based on their belief in the stock's downtrend and the potential for profit from the premium.
NFLXoptions strategyTrading Strategy
high confidenceVerify in video at 30:31 ↗
Q&A

When are Meta's earnings?

The speaker is unsure of the exact date of Meta's earnings and suggests avoiding buying premium due to expensive implied volatility. They recommend alternative strategies like call spreads or broken wing butterflies.

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Actionable takeawayAvoid buying premium before earnings if implied volatility is high; consider alternative strategies like call spreads or broken wing butterflies.
earningsoptions strategy
medium confidenceVerify in video at 33:45 ↗
Q&A

Are you bullish on CL?

The speaker is bullish on CL (Crude Oil) and is short puts, indicating a belief that the price will not fall significantly. The speaker acknowledges that the market may not sharply rise but believes in the continued premium collection through short puts.

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Actionable takeawayThe speaker's bullish stance on CL is based on a short put strategy, which involves selling out-of-the-money puts to collect premium, with the expectation that the underlying asset will remain above the strike price.
CLcommodity_tradingoptions strategy
medium confidenceVerify in video at 56:51 ↗
Q&A

How do you decide to switch between being a premium seller to a premium buyer?

The speaker states that the decision to switch between being a premium seller and a premium buyer is not solely based on IVR levels but is more driven by opportunity. They mention that there is an IVR level at which they would not sell premium, but they do not buy premium even if IVR is low. The speaker emphasizes that volatility spends most of its life in a lull state, and the decision is more about opportunity than volatility.

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Actionable takeawayThe decision to switch between premium selling and buying is more about opportunity than IVR levels, with the speaker indicating that they do not buy premium even when IVR is low.
options strategyvolatility
high confidenceVerify in video at 18:23 ↗
Q&A

Of all the options strategies out there, what is the most consistent and one you would recommend to any investor for overall consistent yearly gains?

The most consistent and recommended options strategy is selling naked puts. This strategy has provided 'free money' over 16-17 years since 2009 with minimal risk and consistent returns. It is highlighted as the best choice for long-term, low-risk investment.

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Actionable takeawayConsider selling naked puts as a low-risk, consistent income strategy for long-term investment.
investmentoptions strategy
high confidenceVerify in video at 45:47 ↗