A FUTURES MAGAZINE feature, By John Sarkett March 16, 2015 Dan Sheridan has seen the options business from both the institutional and retail sides. After 24 years as a Chicago Board Options Exchange market-maker and another 10 years as a options mentor for private traders, his approach has remained consistent: To be successful, you must treat options as a business. “This is a craft,” he says. “We practice it daily. For those with the consistency and discipline, it becomes a good business.” More recently, the practice has had a weekly focus. Weeklies have been the growth end of the options business. More contracts have come on board, and more volume is being traded. There are compelling reasons why:… To read the rest of this article, in which John Sarkett discusses Dan’s risk management style (trading options as a business) and shares Dan’s Nine-day RUT Iron Condor and No-Touch Condor, click here or visit http://somurl.com/futuresmag. Questions? Call us at 800-288-9341 or ask your question through email at email@example.com.
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The CBOE market volatility Index, also known as the VIX, can be a very rewarding trading vehicle. You can use option trades on the VIX to take advantage of the different moves and volatility in the broader markets. The VIX can mirror the same volatility of the S&P 500. Playing this index long or short can take advantage of these moves without as much risk as in the outright buying or selling of the VIX futures. One of my favorite strategies in the VIX, is the Ratio Butterfly. This trade is entered when I feel the VIX is much more likely to move higher than lower. An example of the structure of this Butterfly can be as follows: With the VIX trading around the 15 level, you sell 4 VIX 15 Puts, buy 1 VIX 16 Put and buy 4 VIX 11 puts. Place all of these orders in the same expiration, which is approximately 20 to 40 days from expiration. I have had consistent profits with this strategy whenever the VIX begins to trade around 15 or even lower. In the 12 to 14 area, you could also sell your Butterfly around the 14 strike. This trade is put […]
Answer is yes! The question posed in the title implies that you might trade Iron Condors some months and possibly not others. Maybe when the implied Volatility is up a bit you will sell the Iron Condor, but when it’s low you won’t. That’s what Volatility Trading is all about, selling high volatility and buying low volatility. Though in last few years, option volatilities have basically been low consistently. I teach Retail traders to trade Iron Condors in the same vehicle every month or every week, depending on your preference of Weekly versus Monthly Iron Condors. The Iron Condor is a Probability trade and when you have probabilities in your favor , you need to play every hand and you expect to win over time. So the long winded answer is yes, we sell Iron Condors when VIX is 12, 15, 18, 24, etc. How we manage them when VIX is 12 versus 25 may be a bit different, I will explain. I will look at an example of an Iron Condor in SPX for the February Expiration( 42 days from expiration). With SPX at $1836 I am looking at the 1890-1900 Call credit spread and the 1745-1755 Put credit […]
Wednesday Dan rolled out his new online class. How to Manage a $30,000 Portfolio. Take advantage of our limited EARLY BIRD PRICING!!! To learn more about this class, click here: http://somurl.com/30k The class starts Wednesday, Oct 2nd, Don’t Miss out! EARLY BIRD PRICING!!! BUY NOW Questions? Call Johnny or Jeff at 800-288-9341
Dan Sheridan is teaching a new 4-week class: Managing Stock and Option Trades through the fiscal cliff. We know congress and the President haven’t solved this crisis yet…just kicked it down the road until the end of Feb 2013. If they can actually come up with a solution to the financial bloodshed and restore confidence to the market that the USG won’t turn into another Greece, the pent up demand will explode the market upwards. On the other hand, if things are business-as-usual in Washington, nothing meaningful will be accomplished and our situation will continue to deteriorate. This is bearish for the markets..and could be a huge sell off. Either way, the potential exists for BIG moves in the markets UP or DOWN. Are you ready for it? Join Dan in his new 4-week class as he goes over ways to tweak your stock and option trades to protect yourself from these BIG moves. To watch the first class and sign up for class, go to http://info.sheridanmentoring.com/classes-and-courses/fiscal-cliff-class/
Dan’s two shows for CBOE TV Options Safari this week are: GOOG Earnings Iron Condor Spread AAPL AAPL Bearish Butterfly Spread
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The information contained on this website is for educational purposes only: no representation is being made that the use of any trading strategy or trading methodology will generate guaranteed profits. Past performance is not necessarily indicative of future results. There is substantial risk of loss associated with trading options. Only risk capital should be used to trade. Trading options is not suitable for everyone. You must be aware of the risks and be willing to accept them in order to invest in these markets. Please review the document- http://somurl.com/KnowYourRisk before trading options.