Whenever earnings season comes around, it has the potential to shake up the markets in a big way.
You often hear traders say they sell options ahead of earnings because you’ll get caught in a volatility crush. But if you’re one of the millions of retail traders who don’t know about this common mistake, it could cost you.
Don’t get it twisted... the “vol” that’s getting crushed here is implied volatility, not volume.
Implied volatility is the amount the market thinks a stock price can move…
And it can have a massive impact on what we trade, and how we trade it.
So today, I’m diving deep into the world of implied volatility — how it works, how to find it and what to do about it.
When It Comes to Trading Options, FOMO Is Not Your Friend July 31, 2021
Options trading is a smart way to take advantage of the stock market’s price action, as it offers a cheaper way to go long or short on companies while limiting downside risk. But invest in options without a game plan, and a trader may end up losing a significant amount of money before they even have time to blink...
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