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Short Straddles – Exploit Earnings Option Volatility Crush

Short Straddle Earnings trade on Priceline PCLN. Proper analysis identifies excellent Volatility arbitrage opportunities
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Platform: Udemy
Video: 38m
Language: English
Next start: On Demand

Table of contents

Description

Should we call this trade Priceline Earnings Explosion or Volatility Implosion. Splice and dice it any way you want, there is no doubt this trade is on Steroids. The trade takes advantage of a very specific Volatility Arbitrage situation noticed in Priceline on the day it was reporting earnings. This was a case of mispricing Implied Volatility on the next Option series. A fairly complex Short Straddle strategy, that worked like a gem. Only because the analysis leading up to the trade was Spot On the mark. Believe it or not, this sort of opportunities come up all the time during Earnings reports season. Once you learn this strategy and approach well, you can create very nice 1-day trades based on the Volatility Crush

You will learn

✓ How to Exploit Implied Volatility behavior during the Earnings Cycle
✓ Understand the Risks and Rewards of Naked Option spread selling
✓ Learn to provide the appropriate safety mechanisms in such a trade
✓ Create an explosive trading opportunity with acceptable risk management
✓ Learn an exciting trade that’s alive for barely 24 hours, but can be applied broadly to all stocks during earnings cycle

Requirements

• This is an Advanced Options course, so knowledge of Spreads is Required
• You must be very clear on Concepts of Implied Volatility, Time Decay and Option Greeks
• Some idea of the Earnings Reports cycles and their Effects on Option Prices

This course is for

• An Options trader who already has at least a year or more with Options, and has experience with advanced spread trades
Options Mentor, Financial markets educator, Trader, Investor
Knowledge. Strategy. Execution. 
    Hari Swaminathan is the founder of OptionTiger, a cutting-edge Options mentoring company, and a full-circle educator in all areas of Financial Markets, Hari has developed several proprietary Intellectual Property “methods and approaches” around enhancing base case Options strategies (which favor the Market Makers) and turns that deficit into a massive EDGE on the trader’s side.
Hari has a Bachelors degree in Engineering from College of Engineering, Pune, India, and MBA’s from Columbia University in NYC and London Business School in London UK. 
Hari is self-taught in Options and actively trading these instruments for almost 10 years, mostly through trial and error. Trial and error in general, is an excellent method of learning, but applied in this context, trial and error CAN BE EXPENSIVE. My courseware focuses on this aspect mostly, so you can avoid losing money in the 1 to 2 years when you’re learning.

THE OPTIONS GAME
  More than ever, it has become important for normal people to take charge of their financial situation, and truly understand how financial markets, and the various asset classes, trading nuances really work. Investing in the financial markets is no longer a HANDS-OFF ACTIVITY. There’s no point blaming financial advisors after the fact. Now, it’s become crucial for everyone to do “their OWN homework”, so you can decide for yourself whether something is good or risky. This is of course easier said than done.
My mission is to educate everyday people on the deep, strategic underpinnings of the stock markets, and exploit that knowledge with the use of OPTIONS.  THERE IS NOTHING RANDOM about the markets. There are surprises all the time, but there’s always a method behind every madness. And my goal is to get you to this point of understanding and awareness. That’s when it starts to fit in. 
Knowledge, Education, Crafting Breakthrough strategy, Technical analysis, Following Smart Money, Risk management, Disciplined Money management, and near flawless Execution approaches are just a few of the crucial points emphasized in all the Courses. Video-based education courseware, Practical workshops, several elite proprietary Advanced systems, Proprietary Algorithms and Customized Technical indicators, Live Trading programs are just a few things we offer. The goal is to provide a “full circle” education in the Markets, which is necessary before it starts “fitting in”. 
Let’s break down the Options game in a realistic manner. 
The Pluses
1. Options were invented out of thin air. And the people who invented them won Nobel Prizes for their invention. It is purely a “Mathematical” concept. 
2. This gives rise to very complex but interesting  analytical scenarios. It also gives us the ability to model Options with a set of tools like a car dashboard. This data is embedded in the mathematical formulas that underpin Options structure itself.
3. Because everything in Options is defined in mathematical terms, it’s also important to realize that OPTIONS will always be the same. Forever. Unless they discover serious flaws in the formulas and models used by these Nobel winners. 
4. Options and Chess have LARGE overlaps. You may agree that Chess is a game of “skill”. It’s a game of Strategy and depends upon how well you can plan (ahead) to attack, defend or take a neutral position. We also believe that Chess is strategy-focused and depends upon certain mathematical principles. Why or how do we know this – The reason we know it’s a game of skill is : Try to play 100 chess games with Kasparov or Anand. Normal people are almost guaranteed a loss in all 100 games. So it has to be a game of skill. And why do we know its underlying features are mathematics based. The fact that a computer like Deep Blue beat the GrandMaster Garry Kasparov in 1997.
5. Lastly, You MUST believe this completely –  Options, just like Chess, are a “skill set”, and requires acquiring a deep set of analytical skills much more so than most skill sets in the world, and they can only be MASTERED over a period of time. But, there is a very powerful light at the end of this tunnel. You build a skill set for life.  Age, Geographical location, Lifestyle, or Weather are no longer a barrier to creating consistent income streams, regardless of who you are, where you are, or how old you are. 
This is very POWERFUL stuff. 
Now let’s look at the negatives. This is what most people will NOT tell you. Anyone that tells you Options are SIMPLE, and you can make extra ordinary income easily, is JUST NOT TRUE. I will tell you Options can be brutal if you simply apply speculative methodologies. And once you can develop a SYSTEMATIC approach to every situation (which is the Real Game), you’ll be well on your way to consistent performance.

MINUSES

Options are easily the most fascinating financial instrument with several upside benefits, but also has an equally powerful set of negatives. 
1. Options have a steep learning curve. Don’t expect to become Kasparov in a couple of months. Market Makers who are 99% of the time, the counter party to all Options trades, are Options professionals, with 10 to 20 years of experience, in performing their “legal duty” of providing liquidity. 
2. If you’re interested in Options, try to NOT approach it with a mindset or requirement of making money. This is not only NOT going to happen, but it’s a recipe for disaster. It’s like a student of Medicine wanting to practice their skills after 2 months of study. 
3) As someone that has self-learnt Options and through making mistakes from Trial and Error, I can tell you Options trading is not something you should take lightly. You will hear people talking of fantastic triple and quadruple digit returns. I’m here to be brutally honest with you – 
– Be very very careful in the first 12 months of Options trading. 
– This is when everyone is the most vulnerable to losing money. 
– Your main objective during this time is to focus on learning this craft 
Having said that, if you can get past the first 12 months and acquire the expertise in a systematic manner with systematic approaches to every situation, true financial independence awaits. But you have some serious but exciting work to do before you get there, and I’m here to help you in this journey. 

And join me in my UDemy courses, where I share cutting-edge theoretical knowledge mixed with practical insights, strategy and impeccable execution approaches, through live trading examples. How do we know it’s all this (don’t just go by my word). Check what 50,000 students have to say in 8000 Reviews, with almost 90% of them being 5-Star or 4-Star
If you have any questions at any time, please feel free to message me on Udemy.
The order to follow on my Udemy courses
– Comprehensive guide to Financial Markets, Investing and Trading
– Options Trading Beginners Bundle (3-course Bundle)
– Technical analysis and Chart reading Bundle
– Advanced Options Concepts
– Options spreads and credit spreads Bundle

After this, the order does not matter. You can take any of the courses as per your interest. All the best.
Hari Swaminathan
Browse all courses by on Coursemarks.
Platform: Udemy
Video: 38m
Language: English
Next start: On Demand

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