Tracking a Trade, Market Measures and Politics: Catch Up On What You Missed This Week at tastylive
Tracking a Trade, Market Measures and Politics: Catch Up On What You Missed This Week at tastylive
By:Ryan Gaynor
A weekly roundup of tastylive videos offers the best trading tips from the network’s wealth of financial shows
Is the Sell-Off Really Over?
On the tastylive network’s Let Me Explain show, Chris Vecchio addressed a significant nine-day equity rally, the strongest in 20 years. It was fueled, he said, by a decline in concern about recession and anticipation of a Federal Reserve interest rate cut. Markets are reacting positively despite lackluster reports on manufacturing and jobs from the Institute for Supply Management (ISM). Key discussion points included market trends, positioning around the Jackson Hole Symposium and the potential implications of Fed Chair Jerome Powell's speech. The consensus emphasized a bullish sentiment, Vecchio continued, advocating for strategic market entry and observing the notable rise in gold and silver, indicating sustained strong technical setups.
Defending a Strangle | Life Cycle of a Trade
In Nick Bapatistas new tastylive show, Life Cycle of a Trade, he breaks down a strangle trade using Advanced Micro Devices (AMD) as an example. We start with setting up a strangle with a 135 put and a 190 call, targeting a one standard deviation range and aiming for a $1 to $1.50 profit. As AMD moved, adjustments were necessary because of a significant rise in volatility and a change in stock price. We rolled up the 135 put to 155 to manage delta exposure and captured additional premium. Later, with AMD trading in a tight range, we rolled down the 190 call to 170 to balance our delta exposure further. Ultimately, we closed the position for a $156 profit after the stock moved significantly, post-earnings. The strategy focused on mechanical adjustments and managing delta to capitalize on the trade’s profitability.
What Is the Perfect Number of Deltas?
This week’s Market Measures show on tastylive, with hosts Tom Sosnoff and Tony Battista, focused on hedging strategies for short 30-delta SPY strangles. The key takeaway is to use five to 10 short deltas per strangle to mitigate outlier risk effectively. This approach helps maintain portfolio balance, with a recommendation to avoid over-hedging to ensure positive returns. The segment also touched on market-related risks, the importance of volatility management and the need for cautious, incremental adjustment in trading strategies.
Ryan Gaynor is a video content specialist at tastylive.
For live daily programming, market news and commentary, visit tastylive or the YouTube channels tastylive (for options traders), and tastyliveTrending for stocks, futures, forex & macro.
Trade with a better broker, open a tastytrade account today. tastylive, Inc. and tastytrade, Inc. are separate but affiliated companies.
Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.