Trading volatility for fun and profit

Emanuel

Newbie
3 0
Exploring some new concepts on options. A method I am calling volatility compression. The basic idea is that then the volatility of an equity is heavily compressed there is a big change we will see a volatility release and sizable move in either direction from the compression point. An option bullish strangle or straddle is opened that got a minimum of two months duration until expiry.
 
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Emanuel

Newbie
3 0
First real time trade is a straddle in Alliance Data Systems (ADS) that got a setup.

We chose a straddle as there is no close strikes available, 270 and 290 is to far out.

We buy a June 280 straddle for $2810 that is the current price for 1 contract (100 options).



 
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NVP

Legendary member
37,586 2,008
Exploring some new concepts on options. A method I am calling volatility compression. The basic idea is that then the volatility of an equity is heavily compressed there is a big change we will see a volatility release and sizable move in either direction from the compression point. An option bullish strangle or straddle is opened that got a minimum of two months duration until expiry.

so trading the breakout of a tight range then ?....wait for impending news releases and get best price pre news
 
 
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