Covered Calls Vs. Selling Puts On The SPY

Courtesy of Seeking Alpha's "Reel Ken" We often hear about selling covered calls to generate additional income. We also hear about selling Puts to generate income. So the question becomes: Which is a better strategy? The first step in answering this question is to understand that, from a performance perspective,…Read More

10 April, 2012

Institutions Eye Options: Buy-Writes and Butterflies

Yes, the equities markets are on a roll; the bulls are boisterous, and the "buy and holders" are popping champagne corks. Given this scenario, who would even suggest the idea of a fiduciary fund manager employing option-based hedging strategies that can potentially cut into upside returns?? After all, even though…Read More

16 March, 2012

ETFs with Largest Exposure to AAPL: Should You Hedge?

Now that we've all forgotten the name of that former derivatives trader from Goldman who enjoyed his 15 minutes of "de-fame", we can now all re-focus on the brand that's causing people to line up once again for their latest product offering: Apple Inc. According to ETF Research Center, 91…Read More

16 March, 2012

Betting on Benchmarks : MDY + IJR Out-Performs SPY

Private investor and SeekingAlpha contributor Richard Bloch makes a noteworthy observation when suggesting that "MDY + IJR > SPY". Bloch's thesis is that investing in the S&P 1500, but without the top 500 would have produced noticeably better returns. In fact, Bloch's analysis includes not only a 10-yr look-back on…Read More

5 March, 2012

The Skew is The Clue: VIX Spread Widens

Even if the WSJ is a bit slow on the uptick re: noticing the recent anomaly in VIX skew volatility that we commented on last week, Chris Dieterich's WSJ weekend story, "Surge in FIX Futures Volumes Driven By Bigger Risk Appetites" makes note of the fact that last month's daily…Read More

5 March, 2012

“Its Time To Hedge, Really!” Say Top Traders

Aside from all of the Squawk Box and Fast Money "professional traders" and "market experts" who have been on "high alert" [waiting for a correction] for the past several weeks, even the most blindsided bulls have to acknowledge that every nice move is followed by a pull  back. When considering…Read More

28 February, 2012

VIX Higher, SPX Higher; 30 Yr T touching 3…

Everything went higher today (despite the data during the last minutes into the close); stocks, bonds and fear; a somewhat unique combination of ups. When noticing today's relatively rare direct correlation between equity market volatility (aka VIX), equity indices and "safe haven" US government bonds, option market veteran David Robbins…Read More

27 February, 2012

BuyWriting Back in Vogue: Mutual Funds Warm To “CYA”

We all know that equity markets have been climbing the wall of worry for the past number of months. With both the Dow and S&P recovering to the sanguine levels not seen since the spring of 2008, covered call (buy-write) strategies within the mutual fund complex has until recently remained …Read More

27 February, 2012

VIX Options Volume Spike: Front-Runners Focus on Liquidation?

A snarly spike in iPath's VXX is causing some to scratch heads..is it a sign of things to come (change in recent weather of sunny and warm)? Or, was the volume surge a symptom of traders sensing that one customer was liquidated by their clearing agent? Read the full story…Read More

13 February, 2012