Your Inside Source for Options Information

December 3, 2018

Stock Markets Closed Wednesday

National day of mourning in honor of George H.W. Bush

U.S. financial markets will be closed on Wednesday to honor the memory of former President George H.W. Bush, who passed away late Friday at the age of 94.

The White House said Saturday President Donald Trump would declare December 5th a national day of mourning for the country's 41st president.

The New York Stock Exchange said it will suspend normal trading on Wednesday. "The exchange will observe a minute of silence to honor President Bush on Monday. As per our tradition, we will close the markets in observation of the Day of Mourning," spokesperson Kristen Kaus said.

The Nasdaq will also close for the day.

The stock exchange will observe a moment of silence on Monday "and plans to be closed on December 5, the national day of mourning designated by President Trump," Nasdaq spokesman Will Briganti said.

The NYSE also said the flag will fly at half-staff throughout the mourning period. "We remember President Bush admiringly as a veteran who fought totalitarianism, a statesman who advocated for freedom, a leader who served his country, and an unabashedly dedicated family man," Stacey Cunningham, NYSE Group President, said in a statement.

The NYSE has traditionally closed for all or part of its session for the funeral of a US president, including in 2004 following the death of Ronald Reagan and in 1994, when it closed for the full day for Richard Nixon's funeral.

 

Upcoming Economic Reports

A preview of what may move the market this week

 

Options Insider Radio Network 

Episodes you may have missed from Options Insider Radio last week

Advisors Option 73: Using Options to Trade Stock

The Buzz: What do informed financial advisors need to know?

• FINRA Proposes Higher Position Limits for ETF Options Contracts
• Nine ETF index options contracts have been selected for a doubling of position limits if SEC approves FINRA's proposal.

Office Hours: Listener questions and comments

• Question from Charles Vera - Greetings AO crew (Mark, Chris, Matt, Eric and new entrant John). Love the show and have been listening for over a year and have caught up on most of the back catalog. I have two questions - one options related and one somewhat off topic but I just wanted to pick your brains. 1.) How much capital should I plan to set aside when selling puts for my clients? I'm looking at selling 5-10% OTM spy puts on a monthly or tri-monthly basis? But it seems like the margin requirements for this strategy are all over the place. Do they just vary by broker or is there some rule of thumb I should consider when tying up capital to sell puts? 2.) Do you think the recent market volatility will cause the Fed to reconsider its roadmap for raising rates in the near future? There aren't too many other developed economies that are putting the brakes on like the U.S. right now. Thanks again. Really appreciate all that you guys do.
• Question from Steve Giannakopoulos - Seems right that you can write 1 put option when you already own 100 shares of the underlying stock. Brokerage can lock and keep the 100 shares as collateral instead of holding cash as collateral. It doesn't happen though. Why? You could have your long 100 shares forced sell at the put option strike price if it's ITM and you get assigned. I read what you said, I just don't understand it. Thank you though.
• Question from SX78 - Now Trump is weighing in on this earnings call thing. Does this suddenly have legs? What will this mean for volatility going forward?
• Question from Liznder - If you had to start over with learning about and trading options what would you do differently?

Option Block 763: AAPL Options Debate, Return of the Bull and More

Block/Earnings highlights from the week:

• Tuesday - Salesforce
• Wednesday - Box
• Thursday - TD, GameStop, HP
• Clothing Retailers: Burlington, Chico's, J Jill, Guess, Express, Abercrombie & Fitch

Plus,

• Oil sells off - WTI Crude back in the $40 handle.
• Bitcoin getting crushed - BTC threatening 4000

Odd Block: Tesla put summary, Dec lifts puts in (VOD), opening put love in (AEO), and opening call love in (IQV) Mail Block/Options question of the week AAPL continues to take a beating - recently dropping below $175. We know many of you LOVE to trade AAPL and this selloff creates opportunities. Looking ahead to Jan 2019 expiration- which trade would you prefer to make in AAPL right now?

• Sell Jan 150P for $1.65
• Buy Jan 150P for $1.65
• Sell Jan 200C for $1
• Buy Jan 200C for $1

Listener questions and comments

• Question from Leot - Is Apple a good candidate for stock substitution here? If so how would you set it up?
• Question from Burns - Is buying a call actually the best way to get long stock in this market?

Around The Block/This Week in the Markets

• Nov 29: Jobless Claims, Personal Income and Outlays

 

This Week in Futures Options 128: Deep Dive into Energy Options & Vol

Today's guests are Jeff White, Executive Director, Energy Products & Services at CME Group and John Seguin, Former CME Member and Head Futures Coach for Market Taker Mentoring. Topics this week include:

• Nat Gas
• WTI
• Crude
• CME OPEC Watch Tool
• Equities
• Crypto

Futures Options Feedback: Listener questions and comments

• Comment from Georgio - We need some options on #CMEG BTC futures.
• Comment from Mark Brant - Nat Gas skew is still way to the calls but a risk reversal could be on the horizon!
• Question from ChevCR - Is there ever a time when equity call skew is higher than put skew?

Options Playbook Radio 236: Options for the Stock Investor

How can stock investors use options? You've come to the right place. You can find more in The Options Playbook, which is always available on OptionsPlaybook.com, in on the Amazon Kindle edition. Specifically:

• A review of the AAPL collar from two weeks ago
• What about capital gains?
• Remember we had a small credit
• Where are we now?
• What about additional risk?
• What's an alternative? Using an example with FB
• Using a FB option as a surrogate for stock
• Setting up the trade
• Selecting expiration and strike
• Remember, one option for every 100 shares of stock

Option Block 762: We are Back Talking AAPL, TSLA, VIX, Risk Reversals and More

• Tuesday – Salesforce
• Wednesday – box
• Thursday - TD, GameStop, HP
• Clothing Retailers: Burlington, Chico's, J Jill, Guess, Express, Abercrombie & Fitch

Also, Bitcoin (BTC) dropped to its lowest level since October 2017 on Monday, as losses are seen across the broader crypto market. Odd Block: Tesla put summary, opening call sale in (ADI), opening put love in (CRC), and Jan call sale in (PAA) Strategy Block: Tosaw discusses what a risk reversal is and how to use it. Mail Block: listener questions and comments

• Question from Khabib - What do you think is the best use for unusual activity? Is it the best for trading or for an indicator?

Around the Block/This Week in the Markets

• Nov 27: Consumer Confidence
• Nov 28: GDP

Where to Find Options Insider Radio?

Do you know all the ways you can access Options Insider Radio

          

Options Insider Radio Network Live Recordings

Do you want to be a part of the fun?

This is when you can access the LIVE shows this week:

Monday:

Option Block LIVE at 12pm Central

Thursday:

Option Block LIVE at 12pm Central
This Week in Futures Options LIVE at 1:30 Central

Friday:

Volatility Views LIVE at 12pm Central

As always, you can join in the fun at http://mixlr.com/options-insider/