Davis Martin of DailyProfitMachine.com says that volatility has picked up and it has changed his bread-and-butter S&P 500 options play, giving him better opportunities using SPY puts. When volatility was flagging, Martin said that traders were wise to focus mostly on call options on the SPDR S&P 500 ETF (SPY), but that the SPY puts are attractive again now as two-way action has picked up. He warned that the trades are not for everyone, but he suggested that traders learn how to properly use puts so that when the market starts to turn or has fewer days where the afternoons seem to be all green lights, they can be active and profit.
Davis Martin is the head trader at DailyProfitMachine.com. He trades SPY calls and puts and swing trades mid-large cap stocks and stock options. At the time this interview was recorded on Dec. 6, he had finished day-trading SPY options for the day, but he was planning to trade them again on Dec. 7 in accordance with this discussion. The Raging Bull podcast features experts from the site talking with Raging Bull editor Chuck Jaffe on his show, “Money Life with Chuck Jaffe.” You can learn more about Chuck’s daily hour of market and personal-finance chat at MoneyLifeShow.com; you can subscribe to the Raging Bull podcast via iTunes and other podcast providers.