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The Option Alpha Podcast

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OAP 111 : Should I Buy Back My Penny Options Or Let Them Expire Worthless?

Show notes: You made an options trade and the position has gone well, leaving you with a nice fat profit as expiration approaches. Now the question becomes, what do you do with these cheap out of the money option contracts you sold? Do you buy back your penny options or let them expire worthless? Are there risks to do one over the other and when should you lean one way or not? On today's show I'll talk through what our research shows about exiting trades...

Duration: 00:28:01

OAP 110 : Become A Better Options Trader By NOT Watching The Market

Show notes: Why do we still believe that magically someday we'll have some inside scoop or tip that alerts us to market tops and bottoms? As hopefully rationale adults we often get lured into a false sense of understanding in the financial markets brought on mainly by the media and talking heads. Today I want to help you become a better options trader by not watching the market, focusing and more systematic trading setups, and providing the single most...

Duration: 00:24:17

OAP 109 : Say Good-Bye to Unlimited Risk Option Strategies Forever

Show notes: Unlimited risk option strategies get a bad rap in the investing community among newbie traders. And while our backtesting research has shown that unlimited risk positions like short straddles and short strangles generate the best overall returns, you might be restricted in trading them because of your account type or just fear the big potential drawdowns. In either case, on today's podcast I want to conceptually walk through how you could covert...

Duration: 00:24:40

OAP 108 : Rolling Up Strike Prices vs. Closing Out Trade - What Should I Do?

Show notes: If you trade options longer than ten days you'll undoubtedly run into a scenario where you get challenged by a stock moving either higher or lower against your position. When this happens the first question many people ask is "Do I start rolling up strike prices and adjust the position or work on closing out the trade completely at a loss?" Naturally, we are in the camp where we believe, and our backtesting confirms, that rolling your strike...

Duration: 00:28:56

OAP 107 : Interview w/ Option Alpha Member MACDDaddy & The "Wheel Selling" Options Strategy

Show notes: Today I've very excited to bring one of our very own Option Alpha family members on the show, MACDDaddy aka Robert. He's been a member for many years and someone I continue to seek advice from in many areas. During the show we'll dig deeper into the "Wheel Selling" option strategy which has created some fairly long and in-depth forum threads lately and warrants a little more attention from our weekly podcast.

Duration: 00:33:33

OAP 106 : TLT Short Stock Assignment Case Study - From Loser To $426 Profit

Show notes: As some point or another new option traders worry about their option contracts being assigned. Namely short call options getting short stock assignment. But it's never as bad or horrifying as it may seem and in today's latest show I want to walk through our TLT iron butterfly trade in which we ended up getting assigned 200 shares of short stock just days before expiration.

Duration: 00:25:35

OAP 105 : How To Protect Your Portfolio In A Down Market

Show notes: The further the markets continue to run higher, the greater the risk that another major market correction or market crash will happen in the near future. After all, as we pointed out in Show #15, the stock market has fallen 9 times at least 30% which is once every 10 years. Right now we're riding a 10-year bull rally that's losing steam fast. So, how do you protect your portfolio in a down market? That's the question and today's show will give...

Duration: 00:28:00

OAP 104 : How To Use Pairs Trading With Options To Create Smooth Portfolio Growth

Show notes: On today's newest podcast I want to turn the conversation a bit and focus on pairs trading with options. And this isn't the traditional pairs trading that you might have heard about before where you short one stock and buy another related stock to profit from any trending differences or divergences in the underlying price. Instead, I want to talk about how you can use some very basic portfolio and stock beta concepts to make smarter, more efficient...

Duration: 00:30:41

OAP 103 : How to Pick the Right Stock Options Strategy For Wealth Building

Show notes: Even after discussing and outlining the general process for how to pick the right stock options strategy in previous podcast and videos, I continue to get members who are confused how it should work and the steps one might take. I ultimately believe that in most cases you might be over-thinking it especially when it comes to choosing tickers and market direction. Today's podcast should help clear the air while also giving you concrete examples...

Duration: 00:31:04

OAP 102 : Are You Selling Options That Are Way Too Cheap?

Show notes: When selling options, often I get a question or inquiry from members of our community with regard to how far out of the money we should sell our options and set our positions. Now, I typically target around the 70% probability of success area for my short option selling trades, but others have often wondered that if given the choice why we don't just sell options at the 90% probability of success level? I mean if 70% is good, 90% has to be better...

Duration: 00:28:43

OAP 101 : The Ultimate Guide To Profitably Trading Options Full-Time

Show notes: I believe that on some level every new trader dreams of trading options full time and not working a regular job. The reality is however, that you're need a lot of capital before you make the leap to full time trading and that means you'll have to learn how to effectively trading options while working your day job. Hard as it may seem at first, working full time and trading options is not that complicated nor is it impossible if you're smart about...

Duration: 00:35:21

OAP 100 : The Profit Matrix - The Game-Changing Report On The Best Option Strategies For Any Market

Show notes: Not only is today special because we're releasing our newest research report called The Profit Matrix but also because as soon as this show goes live we'll have crossed more than 1,000,000 downloads on the podcast. Crazy coincidence but it's true and very humbling, so thank you to all of you who have supported and listened over the last couple years. In this special show, we're going to talk in-depth about our new game-changing research report...

Duration: 00:43:04

OAP 099 : Why Automated Trading Will Dominate The Investing World & What You Can Do Now To Prepare

Show notes: The investing world in the next 5-10 years is going to look dramatically different. In fact, the shift to automated trading is already happening at the highest levels and with the biggest hedge funds. So, why is this happening? Why can't we just ignore it? And what can we do now to position ourselves to take advantage of automated trading systems now? Today's show is very high level but I think you'll enjoy the topic but it's a big wave of change...

Duration: 00:28:15

OAP 098 : The End Of Uncertainty & How "Risk" Can Be Managed With Expectancy

Show notes: The markets are evolving faster and faster as the introduction and use of computer-driven or data-driven trading systems start to hit exponential growth rates. So, the question becomes, is this the end of systematic risk and market uncertainty? To put it bluntly, no - in fact, never will we reach a point at which there isn't some sort of systematic risk that we have to price into our options trading. And these future expectancy models are where...

Duration: 00:28:33

OAP 097 : Expected vs. Actual Win Rates When Selling Options [SPY Short Strangle Backtest]

Show notes: Today we're going to use our new Trader's Toolbox and options backtesting software to test win rates when selling options. Because the truth is many people have this huge "rub" with options trading and expected vs. actual win rates. They assume that if we place a new trade with an initial probability of success of 70% that the trade will win at exactly 70% over the long-term. As you'll see today, that's just not the case when you account for the...

Duration: 00:25:07

OAP 096 : Does Higher Implied Volatility Generate Higher Credits? [DIA Put Credit Spread Backtest]

Show notes: Today we wanted to use our new options backtesting software under our Trader's Toolbox to run some credit spread backtests on DIA. Namely, we were trying to determine if selling options during higher implied volatility markets actually generates a higher net credit for the position or not? Plus, we tweaked the allocations just a bit as well to see how different positions sizes impacted returns, drawdowns, and sharpe ratios.

Duration: 00:24:03

OAP 095 : Option Alpha's NEW "Toolbox" For Backtesting Option Strategies

Show notes: It's finally here! After years of research, development, and testing the doors are open to purchase access to our incredible new options backtesting and trade optimization software we're calling the "Trader's Toolbox". Given that we've now got a whole suite of tools and scanners for you to use we have to consolidate it under one roof which is why we believe having a Toolbox is the clearest and logical route. You can learn more about the new...

Duration: 00:49:35

OAP 094 : Which Option Strike Price Should I Select? [AAPL Call Bull Spread Backtest]

Show notes: It's finally here! After years of research, development, and testing the doors are open to purchase access to our incredible new options backtesting and trade optimization software we're calling the "Trader's Toolbox". Given that we've now got a whole suite of tools and scanners for you to use we have to consolidate it under one roof which is why we believe having a Toolbox is the most clear and logical route. You can learn more about the new...

Duration: 00:21:16

OAP 093 : Options Trading Timelines & Duration [EEM Straddle Backtest]

Show notes: How far out should you go when entering a new option trade? 10 day, 30 days, 60 days? Does it change based on the strategy you are using or the market situation you are in? All great questions we aim to answer and in today's newest case study we'll look at how options trading timelines and duration impacted the returns of this EEM straddle backtest. Plus, we'll cover some of the overall performance and variance metrics we ran on both strategy...

Duration: 00:18:36

OAP 092 : Position Sizing Impact On Returns [TLT Iron Condor Backtest]

Show notes: I've said it for years, position sizing matters in a high probability system. Much more so that you would believe and today's show is the first in a new mini-series we are doing leading up to the launch of our new backtesting software. Inside we'll cover a case study using and iron condor backtest we ran on TLT including the impact on returns that altering the position size had on the portfolio.

Duration: 00:23:34

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