Dan Sheridan – Trading Ideas in Volatile Markets

Dan Sheridan – Trading Ideas in Volatile Markets

Dan Sheridan – Trading Ideas in Volatile Markets

COST: $70
Author: Dan Sheridan
Size: 512 MB

Dan discuss the cons and pros of Speculative trading using time-bomb butterfly and calendar spreads in great details:

Put the trade on 10 -20 days prior to expiration but can “plant them” farther out in time

Best in a high IV environment with the expectation of IV going down (after earnings)

It is used as a direction trade instead of buying long options

They are placed OTM not ATM

It’s a one month trade in and out with no adjustments made

Use either Puts or Calls (which ever has highest premium/profit)

Sell the short options at the strike you predict the movement to go to and place the wings 2-4 strikes apart

If using it as a play on earnings, evaluate the effect of the prior earnings announcements:
• Look at the last 3-4 earnings effect on the underlying price
• Look at the last 3-4 earnings effect on IV (see how they drop)
• Compute where the expected move will be and place the short option there

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