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//Learn to Use the Unique MDM Graph to find the Sweet Spot for a Credit Spread Trade. //

Bryan StrainFree Educational Video, ODDS Online, Options, Probability, ValuationLeave a Comment

Now that the CBOE Volatility Index and option prices in general are high again, I thought it would be appropriate to share this clip from one of our ODDS Online coaching sessions where I explain how to find a strike price in the “sweet spot” between theory and reality using our unique Measure Don’t Model Chart.

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//Jamie Dimon Likes Straddles //

Don FishbackProbability, Stock Market, VolatilityLeave a Comment

OK, maybe he doesn’t really “like” straddles. But what he does say implies that the market conditions going forward will have characteristics that are conducive to long straddles. Dimon Sees Recent Volatility as Harbinger of Things to Come A few of the reasons given include what we just wrote about a few days ago: declining liquidity. A key nugget in … Read More

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//Something Missing? //

Don FishbackOptions, Probability, Uncategorized, VolatilityLeave a Comment

If you’re into probability — that would be anyone who has ODDS in their name like I do — this is a thought-provoking chart from a Bloomberg article this morning. I’ve created charts similar to this in the past using my trusty spreadsheets. What they’ve done that is different from the normal bell curve is that instead of using the … Read More

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//Outcome Bias //

Don FishbackGeneral Investing, ProbabilityLeave a Comment

I want everyone to read this article by Joe Wiggins. As an investing instructor for over 20 years, I’ve been uniquely positioned to witness the effect of outcome bias. In the middle of the dot-com bubble, I saw my Dad second mortgage his house to get money to trade. He was always asking me to tell him which stock is … Read More

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//Underdogs Win //

Don FishbackProbability, Stock MarketLeave a Comment

With the Super Bowl being the largest betting event in the US, this seems appropriate. You’ll love having these hated stocks in your portfolio Trading is like betting against the spread. When you bet on the favorite, they don’t need to just win, they need to cover the spread. If they don’t, then the bet on the underdog pays. Doesn’t … Read More