Options & Derivatives Blogs and Articles
Options & Derivatives Blogs and Articles
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EMAIL DIGESTS
Daily
Every morning
Weekly
Tuesday recap
A recent study re‑examines classic passive option strategies using actual options data from 2012‑2023 and finds that simple call‑write or put‑write approaches no longer deliver superior risk‑adjusted returns versus the S&P 500. The protective‑put (PPUT) strategy, especially when modified to skip puts after a one‑standard‑deviation drawdown, consistently outperforms the benchmark. Parallel Monte‑Carlo research on dollar‑cost averaging (DCA) shows the method underperforms buy‑and‑hold in steady or rising markets but gains a risk‑adjusted edge in highly volatile environments. Both lines of evidence suggest static, one‑size‑fits‑all tactics are losing relevance.
Hotstuff has launched a BNB perpetual futures market on its beta platform, offering traders up to 25x leverage. The product is currently available through an invite‑only mainnet beta, with plans for a phased expansion to a broader user base. Access...
The five‑year U.S. Treasury credit default swap (CDS) curve has surged since late 2024, spiking amid heightened geopolitical tension and domestic policy scrutiny. The graph shows a sharp rise around July 2025, coinciding with the investigation into Fed Chair Jay Powell,...
The CBOE Crude Oil Volatility Index (OVX) closed at 92.37 on March 26, 2026, marking a 2.45% increase from the prior session. Brent crude futures traded at $107.10 per barrel, reflecting strong price momentum. The uptick in OVX suggests growing...
Edward Corona announced the closure of a cash‑secured put on Ondas Holdings (ONDS) after collecting a $180 premium and realizing a $123 profit, representing a 68.33% capture of the premium. The trade was a -6 Apr 2 $7.5 cash‑secured put...
Silver’s open interest has fallen to its lowest level in over two decades, suggesting the metal is deeply oversold and may soon reverse higher. Gold also shows weakness, with Comex open interest under 400,000 contracts and prices testing key moving...
The piece uses Doug Costa’s coin‑flip contract example to illustrate the power of the no‑arbitrage axiom in derivative pricing. By calculating the no‑arbitrage price and delta hedge, it shows that even with perfect knowledge of true probabilities, a trader can...
On Tuesday morning, oil futures trading surged dramatically as 734 contracts changed hands between 10:49 and 10:50 GMT, jumping to 2,168 contracts in the following minute—16 times the day’s average volume. Bloomberg valued the contracts traded in that 60‑second window at...
The author breaks down the recent S&P 500 futures (ES) action, highlighting an "elevator down" sell that led to a rapid failed‑breakdown and a 200‑point rally up to the 6720 level. After the surge, ES entered a tight consolidation between...
Options writer Edward Corona announced he is closing two cash‑secured put positions on Hut8 Corp and Redwire Corp after capturing more than 80 % of the collected premiums. The Hut8 trade yielded a $184 open profit on a $213 premium, while...
Andy Millett and Alasdair Macleod dissect the recent plunge in gold and silver prices, arguing that paper markets have become detached from the underlying bullion demand. They highlight weak speculative activity on COMEX and note that retail demand in the...
The post outlines a hands‑on market‑making experiment using Polymarket’s crude‑oil binary contract and a tight 89.5/90.5 call spread priced with Black‑Scholes. By computing each instrument’s implied delta—how many probability points move per $1 change in CL—you can spot when the...
A cluster of six Polymarket wallets earned roughly $1.2 million by buying low‑priced "Yes" shares on a contract predicting a U.S.–Israeli strike on Iran on February 28, 2026. Similar insider‑informed bets generated $485,000 from a $38,500 stake on the covert capture of Venezuelan...
The article outlines a "basis defense" mechanism where a persistent positive spread between futures and spot prices creates a synthetic floor that forces institutional investors to buy index‑heavy stocks during foreign spot sell‑offs. On March 25, 2026, foreign investors dumped roughly...
Futures were mixed on Tuesday, with grain contracts climbing while soybeans slipped, reflecting a modest correction from the previous session’s volatility. Market activity remained thin due to a lack of fresh news, especially regarding the ongoing US‑Iran conflict. The White...
A recent study examines the order imbalance of in‑the‑money S&P 500 options placed by public customers and finds it predicts market returns over a one‑ to three‑month horizon, extending up to nine months in some tests. The directional order imbalance (DOI)...
The author recommends a cash‑secured put trade on a stock that repeatedly retreats into a well‑defined price range. Premiums remain elevated following recent market weakness, making the option sell attractive. While maintaining a bullish long‑term view, the trader aims to...
Crude oil futures experienced a dramatic swing from $84.37 to $101.67 after President Trump’s Truth Social remarks, highlighting the market’s sensitivity to geopolitical headlines. The contract now sits near $92.68, just below the 50% midpoint of $93.02, keeping sellers in...
President Trump announced a pause on strikes against Iranian energy infrastructure, sending oil prices sharply lower and triggering a rapid reversal across global risk assets. The market remains jittery as equities fluctuate and oil attempts to recover amid ongoing Middle...
A trader is leveraging today’s market rally to write a covered call on Opendoor Technologies Inc. The trade sells a 7.5‑strike call expiring in 32 days for a $0.06 premium, costing $6 to establish. The position projects a 14.14% annualized...
In Episode 18 of Vol Street Journal, the host highlights a tightening VIX curve, signaling heightened sensitivity to market moves. He notes an unusual flattening of the skew as put implied volatility fell even during a 120‑point market decline. The...
Three weeks into the Iran‑Qatar conflict, a strike on Qatar’s LNG facility has turned a geopolitical flashpoint into a structural energy supply crunch, prompting European leaders to warn of a multi‑year gas squeeze. Despite widening credit spreads, equity momentum loss,...
Futures markets opened mixed but slipped into negative territory by mid‑session as traders engaged in end‑of‑week profit taking and consolidation. The lack of fresh domestic news left markets vulnerable, while external geopolitical developments dominated headlines. Growing concerns over the US‑Iran...
White sugar futures jumped to a 4.75‑month high as crude oil and gasoline prices surged, lifting the energy‑linked ethanol diversion mechanism. The rally is mechanical, not driven by tighter supply‑demand. India’s record sugar output and an approved export programme add...
The author introduces a calendar‑month realized volatility (CMRV) metric that computes monthly volatility by annualizing the square‑root of the mean squared daily log returns, eliminating the overlap inherent in a trailing 20‑day window. This approach prevents a large earnings‑driven move...
H&R Block (HRB) saw its implied volatility surge to a one‑year high after market chatter about AI disruptions. The company’s low P/E ratio and 16% earnings yield give it bond‑like characteristics, prompting the author to sell cash‑secured puts instead of...
John Jenkins highlights key considerations for sellers contemplating equity rollovers in M&A transactions. The blog stresses that call options embedded in buyer agreements can allow the acquirer to repurchase the seller’s rolled‑over stake, often at below‑market prices and over extended...
The Bank for International Settlements (BIS) released a report attributing the 36% plunge in silver on January 30 to the expanding role of leveraged exchange‑traded funds (ETFs). Retail investors poured into double‑levered products such as AGQ, forcing rapid rebalancing in silver...
Today's agricultural futures market moved in mixed directions before rallying across the board. Soybeans saw spread trading keep spot prices flat while deferred contracts gained, and the whole soy complex later rose on energy support. Corn prices were buoyed by...
A trader is re‑entering a cash‑secured put (CSP) position on a specific stock after several profitable rotations. The trade is anchored by a Probability of Profit (POP) of 88% and a Probability of Worthlessness (POW) of 85%, indicating a strong...
The author is closing three cash‑secured put positions on Rocket Lab (RKLB), Oklo (OKLO) and Symbotic (SYM) after capturing the majority of the premiums. Each trade shows over 85% premium collected, with RKLB at 90.77% and a 10‑day expiry, OKLO...
Legal scholar John C. Coffee highlights how prediction‑market platforms like Polymarket and CFTC‑regulated Kalshi have allowed traders to profit from bets on U.S. military action and leadership changes in Iran. The Commodity Futures Trading Commission (CFTC) possesses authority under Rule 40.11...
Kevin Hassett highlighted on CBS Face the Nation that oil futures are pricing a rapid decline in oil prices, even as spot gasoline prices surge due to current Strait disruptions. The forward curve suggests Brent will not revert to its pre‑war...
The Iran‑Israel war has reignited fears of a major disruption to oil flows through the Strait of Hormuz, sending shockwaves through global markets. Gold futures remain near $5,013 per ounce while silver hovers around $81, reflecting heightened volatility but limited...
The piece highlights a widening gap between realized equity volatility and the higher implied volatility priced into options, suggesting market complacency. It warns that clearing existing puts and VIX call positions ahead of the upcoming FOMC meeting and QOPEX could...
Derive, formerly Lyra Finance, has transitioned from an Optimism‑based AMM to its own OP‑Stack rollup appchain featuring a central limit order book. The platform now offers options, perpetuals, and spot trading, with options remaining its core product, supported by an...
US equity futures nudged higher on Monday, led by Meta’s rally after the company disclosed sweeping AI‑driven workforce cuts. Meanwhile, crude oil lingered near the $100‑a‑barrel mark as Strait of Hormuz shipments remained disrupted, keeping risk appetite muted. Elevated energy...
Bitcoin futures are displaying a modest bullish tilt as BTC hovers around $73,000, with taker volume showing 51.9% long versus 48.1% short, translating to $30.8 bn in buys against $28.6 bn in sells across Binance, OKX and Bybit. Short liquidations exceed longs,...
Derivative finance encompasses contracts whose value is tied to an underlying asset such as stocks, commodities, currencies, or interest rates. These instruments—futures, options, forwards, and swaps—are traded on regulated exchanges or over‑the‑counter, offering standardized or customized terms. Leverage allows participants...
Retail investors treat stock options like gambling, driving higher trading volumes in states with strong gambling cultures. Researchers built a Google Search Volume Index to capture option‑related attention, finding spikes around earnings announcements and other firm‑specific news. The study shows...
A trader is initiating a cash‑secured put on a stock that has recently pulled back after a strong uptrend. Technical analysis shows the price holding above its longer‑term trend line while momentum indicators are stabilizing, suggesting a lower‑risk entry point....
Crude oil’s deep, liquid futures market makes it a prime playground for day traders and systematic strategies. A 2019 study found that the price movement in the first half‑hour of trading (9:30‑10:00 a.m. EST) reliably predicts the final half‑hour (3:30‑4:00 p.m. EST)....
In 2025, SDR‑reported cleared interest‑rate compression reached $170 trillion, a 73% jump from 2024. OIS compression alone accounted for $151 trillion, up 80%, while basis‑swap compression surged 212% to $1.76 trillion and fixed‑float IRS rose 28% to $16.9 trillion. Off‑platform activity expanded dramatically, capturing...
The 2022 study by Pasricha, Zhu, and He extends the Black‑Scholes‑Merton framework by introducing a liquidity discount factor that reflects market‑wide illiquidity. Using a mean‑reverting stochastic process for liquidity, the authors derive a closed‑form pricing formula for European options. Numerical...
The newsletter dissects recent S&P 500 E‑mini (ES) moves, labeling rapid sell‑offs as "elevator down" events that trigger failed breakdowns and short squeezes. After a sharp dip to 6588 on Sunday, the index rebounded to 6850, repeatedly testing the 6778‑82...
Crypto traders are turning to decentralized exchanges for macro bets, with oil leading the pack this week. Hyperliquid’s oil‑linked perpetual contract (CL‑USDC) generated over $1.2 billion in 24‑hour volume, overtaking ether and becoming the platform’s second‑most traded market after bitcoin. Open...
Futures across several markets, including agriculture, opened weaker as energy prices corrected following President Trump’s remarks that the Iran conflict may be winding down. Crude fell nearly $8 per barrel amid expectations of strategic reserve releases and possible easing of...
ICE May cocoa futures surged nearly 12% this week, climbing from $2,888 to $3,230 per tonne, marking one of the sharpest recoveries after a prolonged liquidation phase. The rally was driven primarily by short‑covering and logistical disruptions rather than fundamental...
Australian Q2 electricity contract prices surged this week, with the New South Wales (NSW) market showing the sharpest increase. The rise follows the onset of the Middle East conflict, which analysts say is filtering through to Australian energy pricing. ez2view...
SpotGamma’s Compass, Equity Hub, and HIRO flow tools identified a bearish breakdown in MicroStrategy (MSTR) after the stock slipped below the critical $165 call wall, a key gamma level. The breach triggered aggressive put buying and call selling, prompting market...
