5 Tips When Digging For New Stock And Option Trading Ideas | Best Trade Ideas 2018

5 Tips When Digging For New Stock And Option Trading Ideas | Best Trade Ideas 2018


– [Jonathan] Hey everyone, it’s Jonathan. So, I want to make a video. This video’s going to be
five tips when you’re digging for any new stock or option trade ideas. The first tip is going
to be Cboe volatility. This is a site that I use all the time. If you just search Cboe volatility
indexes, you’ll find it. Once you scroll down, the
great thing about this site is not only it tell you about the VIX, it breaks out volatility, and
by breaking out volatility, I mean volatility on China, VXFXI, volatility on Brazil, VXEWZ, crude volatility, gold
volatility, et cetera. So, how this can help
you dig for trading ideas is you want to find big changes of volatility that’s increasing. Once you find volatility
that’s increasing, then you dig deeper and try to find ways to express that opinion. So, if we use the example of Brazil, Brazil, right now,
volatility’s increasing. So you can search Brazil names. Search for inexpensive
volatility in Brazil, relative to those
Brazilian companies or ETFs that volatility’s already gone higher. Once you find those, that’s a trade. You want to buy options in
that inexpensive volatility. Buy calls. Buy puts. Buy straddles. Buy strangles. Do debit spreads. Same thing for volatility
that you think is expensive. Maybe you see it going lower. For you, the trade idea is sell options. So that’s number one,
use the Cboe volatility. The next thing, use Twitter more, guys. So you can use Twitter as a news service. So, I’m not really
active as far as posting, but when I’m searching
my names, I always want to go to Twitter and I want to see what people are talking about. You can go top, the latest, scroll down and use Twitter as a
newsfeed, as a news source. That’s how I use it, anyway. So, number one, Cboe volatility,
number two, use Twitter. FINVIZ, number three,
really good, free scanner. FINVIZ stock screener. Go to the screener. I like to go all right here. Really good trade ideas can be found. 200-day simple moving averages. Price 10% above or price 10% below. I’m a big believer that stocks do not like to stay around very, very big numbers. Total 3,000, okay, well,
that’s too many to go through. So I’d work on getting this subset down. So if the market’s strong, price 10% above a 200-day simple moving average. Well, let’s start
getting that subset down. Let’s say we want over 10. Let’s say we want optionable. Down to 1,721. Maybe we want volume, over 500,000 shares that are traded. Get the subset down. That’s going to be the number one thing. If you’re buying options,
you probably want to be in growth stocks, right, not value stocks. What’s the one difference between growth stocks and value stocks? Dividend. If you’re looking for movement,
you don’t want a dividend. You want growth. You want companies that are reinvesting that money into the growth of the company. Maybe you want to increase the beta. Maybe you want to increase
the average true range. You want to get the subset down, so that’s the third thing that I would do in order to find different trade ideas. Next, look at your calendar. How can a calendar help with trade ideas? Well, what do we know? The first Friday of every
month is unemployment. This is movement, right? We have an expectation that
volatility will increase because of non-foreign payrolls. You look at Fed announcements. We have a holiday coming
up in mid-February. Markets are going to be closed. You probably don’t want to be holding a big, long options position
during a holiday weekend. Look at the calendar. This is just common
sense, but people don’t use the calendar often enough. After unemployment, if there’s no more news releases going
into the third Friday, be careful being long options, right? Theta’s going to come out of those options without a volatility catalyst,
like on unemployment Friday. So we have the vol, we
got Twitter, we have moving averages, the calendar,
and then finally, guys… Get creative. Look at things from a
different perspective. ZB futures, I look at futures
relative to another future. So whenever I’m looking
at ZB, I, personally, am going to look, how is it
priced against the tenure? Is it expensive? Is it inexpensive? How is the ZB priced against the VIX? How is it priced against
the entire yield curve? How is it priced against Crude? Be creative. I always say, those who are most creative are going to have the
most success in the trade because what you’re doing
is you’re looking at things from a different lens than everybody else. You’re creating edge by going and finding a trade that’s not crowded. Apple, Amazon, those trades are crowded. Get creative. Don’t just trade S&P, buy and sell. Look at the S&P’s relative
against all the other indices and try to find trades that way. So those are it, guys,
five different ways for you to hunt, dig for different trades. Go volatility. Use Twitter as a news source. Find stocks that are
close to big, big numbers. Always, always, always pay
attention to your calendar. Know when there’s a vol event,
a volatility event coming up. And, finally, he who’s
most creative, wins. Be confident in your own process. Look at things from a different lens. You want to learn more,
you have any questions, email me, [email protected] My name’s Jonathan Rose. Thanks for listening, guys. If you would, subscribe, like the video. I’d really appreciate it. It means a lot. Thanks a lot, guys.

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