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Thanksgiving Week Seasonality: 2020 Update (Preview)

By Lawrence G. McMillan

Thanksgiving sets off a number of seasonal patterns, although we combine several of them for one trade.  The three main seasonal patterns are:

1) post-Thanksgiving bullishness: buy the market at the close of the day before Thanksgiving and hold into mid-December.

Larry McMillan Stock Market Update Video 11/23/2020

By Lawrence G. McMillan

Join Larry McMillan as he discusses the current state of the stock market on Monday, November 23rd, 2020.

The Heating Oil – Gasoline Spread: 2020 Update (Preview)

By Lawrence G. McMillan

We have been trading this seasonal spread annually every year since 1994, except for 1995. The spread has a good track record, but suffered its worst loss to date last year. All of the pertinent statistics are included below.

Weekly Stock Market Commentary 11/20/2020

By Lawrence G. McMillan

The broad market, as measured by $SPX, finally reached a new all-time closing high this week, at 3626 on Tuesday, November 16th. It was unable to hold that level and has now fallen back a bit. In fact, it has closed back below the old September highs of 3588. That in itself is not a problem, but if $SPX were to close below 3500, that would be bearish.

Why are LEAPS More Expensive? (03:04)

By Lawrence G. McMillan

This article was originally published in The Option Strategist Newsletter Volume 3, No. 4 on February 24, 1994. 

One of our readers recently asked some astute questions concerning the implied volatility of long-term options versus short-term options. We thought it might make for a thought-provoking article. It is generally the case that implied volatilities of longer-term options are higher than those of short-term options (except when the underlying security has been very volatile in the near term). The relevant questions one might ask are "Why does this occur?" and "Should this occur?". We'll try to answer those questions in this article, although — as you'll see — those are not necessarily easy questions to answer in a practical sense, even though they might be in a theoretical sense.

Expiration – Facts and Fiction (11:03)

By Lawrence G. McMillan

This article was originally published in The Option Strategist Newsletter Volume 11, No. 3 on February 14, 2002. 

In looking at some of the questions that have been submitted to us through the Q&A section of our web site and at the Intensive Option Seminar that was recently held in Boca Raton, FL, it is apparent that a number of them have to do with expiration – how an individual trader should handle a trade, what price index options are settled at, how arbitrage might affect the market or an individual stock, and so forth. This article will address all of the questions that have been asked, by interspersing the questions with commentary that answers the questions and expands on the concepts.

Put-Call Ratios in 2020: A Historic Year (Preview)

By Lawrence G. McMillan

We have continually been talking about how low the equity-only put-call ratios have been this year – first in January when they dropped to the lowest levels since levels since 2014, but then again in August when they dropped to the lowest levels in our database, which goes back to 2001.

Larry McMillan Stock Market Update Video 11/16/2020

By Lawrence G. McMillan

Join Larry McMillan as he discusses the current state of the stock market on Monday, November 16th, 2020.

Covered Writing Against LEAPS (10:05)

By Lawrence G. McMillan

This article was originally published in The Option Strategist Newsletter Volume 10, No. 5 on March 8, 2001. 

We receive a lot of questions here at McMillan Analysis Corporation – most of them come in from the Q&A section on our web site. The more generic (and interesting) questions and answers get posted on the site. Those that are specific get a personal email answer. One way or the other, they all receive an answer – although we do not comment on specific stocks or specific positions in your trading account. We also hear a number of questions at seminars (so far this year, we’ve attended four seminars), and that is where we got the idea for this article. One topic that people seem to want to discuss is that of “covered writing against LEAPS.” Many people think this strategy has little or no risk, based on some sort of historical studies.

Weekly Stock Market Commentary 11/13/2020

By Lawrence G. McMillan

Last Monday, the COVID-19 vaccine new caused $SPX to gap up 135 points on Monday's open. That was the largest percentage gap to a new all-time high in history.

As traders know, there's an old adage to "sell the news," especially if there has been anticipatory buying before "the news." And they did, drving $SPX back inside its 3200-3600 trading range.

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