It is hard to believe that after years of being in the wilderness, CSCO makes Goldman Sachs conviction by list. In the 1990’s, that would have moved CSCO about 25%, but these days, it is only good for about 3%. Either way 3% for CSCO is a big deal. For a stock that usually hums along at 20% or so, volatility is worth noting whenever a sleeping giant wakes up.
As I reflect on my options trading, I always ask myself, what I am missing. One of my biggest worries is the fear of the unknown. As they say, “you don’t know what you don’t know”. When I was a management consultant at Bain & Co., clients would hire us to help them develop business strategies. Our clients were operating their business and were focused on the day to day. They were so involved in their business that sometimes they missed seeing the big picture and needed outside assistance to give them a different perspective. They didn’t know what they didn’t know. They needed someone to protect their blind side. The same way that left tackle in football is in charge of protecting the blind side of a
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If you would like to catch up on Mark and Andrew's webin on "When Not to Use the VIX as an Indicator", click here for the video! You will either need to be signed up for an Option Pit service or a free account to watch this webinar. In this Webinar Option Pit's educators discuss what the VIX is, how it is used, and then the important times not to use it.
We will be having the second free webinar in our using the VIX to trade series. Go to our EVENTS page to register. Also, make sure to read the Option Pit Challenge below:
As I was looking at the VIX trading relative to the SPX, I was struck by a few things:
1. While the VIX really threatened to break 20, it never did. The VIX rallied toward the end of the day, which shows there are some buyers of insurance that are willing to step in and buy insurance with the VIX at 20.00
We will be having the second free webinar in our using the VIX to trade series. Go to our EVENTS page to register.
I know it might sound funny, but it is possible that the first quarter of 2012 could be a really boring quarter. The VIX has normalized and is about to dip below 20%. The SPX isn’t moving at all. SPX IV is now trading at the highest premium to 10 day realized IV that we have seen since April of 2011.