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Gamma & Gamma Exposure - What Traders Need to Know

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“gamma is one of the larger sources of non-fundamental economic activity in global markets. Market makers who delta-hedge their option positions are economically driven to trade substantial amounts of underlying shares or futures, strictly as a result of the price of the underlying itself changing, not as a result of fundamental news and without regard to the liquidity available. As a result, gamma can cause markets to overreact to fundamental news (short gamma) or too under-react to fundamental news (long gamma).”

What Happened With Robinhood? Unpacking the WallStreetBets Rebellion

Where do we begin? First of all, Robinhood was not the singular brokerage restricting buying in Gamestock (ticker symbol $GME) and the variety of other stocks that had restrictions placed on them. I personally use a direct access broker, and noted within the Trader’s Thinktank® that on Monday (1/25/21) they had rejected all options orders in GME. Much of what is discussed in this article will apply to most brokers. That being said, I’ll be using Robinhood in this article because they are the notable broker involved in this fiasco.

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Understanding Trader Psychology - 11 Things You Should Know

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You can’t control the market but you can control how you react to it. Studying and understanding trading psychology allows you to analyze your own behavioral patterns and make the necessary improvements. A focus on trading psychology, your behavior, and emotion is the ultimate compliment to market research, technical analysis, and tape reading.

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The Importance of Self-Awareness for Day Traders

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The Importance of Self-Awareness for Day Traders

In today’s society where the average attention span is rapidly decreasing, we easily lose the connection to ourselves. The term “self-awareness” has a spiritual feel to it and most people (particularly traders) are going to lose interest in the conversation the moment you bring it up. However, I have never interacted with a successful trader who is not highly self-aware.

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You Made A Huge Trading Mistake - Now What?

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You Made A Huge Trading Mistake - Now What?

Trader’s make mistakes, and it will happen again. Moving past these mistakes can be challenging, particularly with the commitment bias working against us. How we handle ourselves in these moments is critical to our success as traders.

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Option Sweeps - What The Data Means & How Retail Option Traders Can Benefit

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Option Sweeps - What The Data Means & How Retail Option Traders Can Benefit

By keeping an eye out for option sweeps, retail traders can get an idea of what the market’s “smart-money” high-rollers are thinking - and exactly how they are positioning. Remove the noise in options and zone in on what truly matters.

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Bid Size and Ask Size on Option Contracts - How You Can Use It To Your Advantage

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When bid size is radically different from the ask size, it can represent a supply and demand imbalance. Bid size and ask size can help traders gauge where to place orders and in turn, get quicker fills.

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Options Implied Move - What Is It?

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During each earnings season, traders and investors often focus their attention on a crucial metric: the "options implied move" or "expected move" of a stock's earnings report (ER). This metric is vital for making informed decisions in the world of trading. In this article, we will delve into the concept of the options implied move, explaining how it's calculated and why it matters.