Option Block 399: The Gamma Rage Monster

Trading Block: A reversal of the selloff we saw earlier this week. Big Apple numbers. S&P 500 erases 2015 loss, euro weakens on stimulus bets

 

 

Odd Block: Puts trade in iPath S&P 500 Short Term VIX ETN (VXX), calls go up in Brunswick Corp. (BC), and puts roll in Vanguard Emerging Markets ETF (VWO)

 

Xpress Block: What was the most notable change in the business in 2014? And what will that mean for 2015?

 

Mail Block: Listener Questions & Comments

• Question from Neil Joyce - Hello Option Block crew. It is that time of year. I have some stocks I want to take gains in for 2014, but I do not want to sit on the sidelines for the mandatory 30 days before I get back in. What if I buy a one-month call to cover the wash sale period, then buy the stock again on day 31? Is that legit from an IRS perspective, or does buying the call effectively make the stock trade a wash sale? Great show! Look forward to more fun in the New Year.
• Question from Joseph G: ‏@Options Gamma? Are them those rays that turned Dr. Bruce Banner into the Hulk? lol...Seriously - can you sum up what I need to be concerned about with gamma when selling weekly put options? Mostly OTM with 4-7 days to expiration.
• Question from Mark Brant:  @Options AAPL front-week trend trade: Near Mon. close buy the C/P reflecting the day's direction, and TP near Fri. close. +ev over a year.

 

Around the Block: Employment numbers out Friday.