Other bear markets have shown similar behavior: realized volatility increases by a relatively small amount, and $VIX therefore does not accelerate to extreme highs. Often, late in the bear market – near its bottom – is when we see a sharper increase in volatility.
Join Larry McMillan as he discusses the current state of the stock market on April 17, 2023.
The rally that began in mid-March is persisting. Market internals remain positive, and that is finally having enough of an effect on $SPX (and the market psyche) to push prices higher in a relatively slow manner. Even so, there is formidable overhead resistance at 4200 and 4300, so the $SPX chart will not be outright bullish until those levels are exceeded (in my opinion).
This article was originally published in The Option Strategist Newsletter Volume 13, No. 3 on February 12, 2004.
One of the most tantalizing, yet dangerous, items in all of trading is the expensive option. From an elementary viewpoint, one would like to sell the option and collect the time value premium decay as it wastes away to nothing. But, more often than not, the options were expensive for a reason, so the option seller suddenly finds himself fighting the trend of a volatile movement by the underlying. In this article, we're going to discuss a few of the things to look for and then suggest a strategy that might be a "middle ground" where a skew is also involved with the expensive option (which it often is).
Join Larry McMillan as he discusses the current state of the stock market on April 10, 2023.
The fact that $SPX broke over the downtrend line that had existed for most of February and March doesn't necessarily mean that the $SPX chart is outright bullish, though, for there is formidable resistance at both 4200 and 4300. It's just not a bearish chart right now. Several indicators are overbought at this time, and some of them might be issuing sell signals soon. In addition, $SPX has advanced above its +3å "modified Bollinger Band."
This article was originally published in The Option Strategist Newsletter Volume 4, No. 14 on July 26, 1995.
We have written about portfolio protection using options in the past, but with the relatively large number of questions coming from subscribers about this topic, it appears to be time to revisit it. We will go through an example using a small, but highly volatile portfolio. This is the type that seems to be worrying individual investors the most; they are, of course, happy with the profits that have built up in the tech stocks, but are nervous about how to protect those profits.
Join Larry McMillan as he discusses the current state of the stock market on April 3, 2023.
Ed Kelly was one of the original floor brokers on the CBOE from Day One. He served on many important committees and was a stalwart at the Exchange. Joe Doherty – whose own recollections are posted elsewhere on this website – had this to say about Ed: “ He was the consummate professional from the moment he stepped on the floor. I very much liked his appreciation of what the early CBOE was, his recognition of what it could become, and his willingness to work with that long term potential in mind. This at a time when many of his contemporaries, in the early days, viewed the trading floor as a candy store from which they should grab as many sweets as fast as they could.”