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Options Trader Pro
Advanced Trading Strategies for Big Profits in Any Market
The holiday-shortened week was fairly positive as the S&P 500 rose 1.6%, the Dow added another 1.9%, and the Nasdaq gained 0.75%.
The three leading indexes were slightly lower last week as the S&P 500 fell 0.61%, the Dow declined by 0.5%, and the Nasdaq lost 1%.
Sparked by an inflation data point that showed some signs of cooling, the market surged higher last week. The S&P 500 gained 6%, the Dow rose 4% and the Nasdaq gained a whopping 8.8%.
Last week’s “big” market-moving events (Federal Reserve and Jobs Report) brought further selling as the S&P 500 fell 3.25%, the Dow lost 2.25%, and the Nasdaq dropped 5.88%.
Tomorrow afternoon traders will get another look at how the Federal Reserve perceives the inflation situation, as well as its plans to manage interest rate hikes going forward. Below are the expectations in the options market, the bond market, and from a couple Wall Street firms.
This week earnings season really gets in gear … buckle up, and be prepared to jump into some earnings season winners if the market can continue to show signs of strength.
As earnings season ramps up in the coming week, I wanted to note a couple items.
A very promising start to the trading week, which saw the indexes surge higher by 5%, was somewhat washed away by Friday’s post Jobs Report sell-off. And while the steep declines Friday were worrisome, big picture the S&P 500 still managed to gain 1.5% on the week, the Dow rallied 2%, and the Nasdaq added 0.7%.
The month of September was flat out ugly for the market as the S&P 500 fell 9.3%, its worst monthly drop since March 2020 (Covid). And the numbers were similarly negative this last week as the S&P 500 and Dow lost 3%, and the Nasdaq fell another 2.7%.
As central banks around the globe aggressively raised interest rates, the stock market had its second straight awful week of trading. The S&P 500 fell 4.6%, the Dow lost 4%, and the Nasdaq continued its ugly slide, falling another 5.1%.
Sparked by a “hotter”-than-expected inflation report on Tuesday, the market had its worst week since June. The numbers were not pretty as the S&P 500 fell 5.15%, the Dow lost 4.13%, and the Nasdaq declined by another 5.5%.
Coming off three straight weeks of losses, the bulls staged a rebound last week as the S&P 500 gained 3.65%, the Dow rose 2.66% and the Nasdaq rebounded by 4.1%.
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Options Strategy
Options trading has its own vernacular. To know how to do it, you need to know what every options term means. Here are some of the basics.
Want to know how the big institutional investors use options? Here is an example of how one trader spent $132 million on three technology stocks.
This guide will help you execute the three types of options strategies recommended in Cabot Options Trader: Buying puts and calls, covered call writing and spreads.
Guide to Options Trading — Pro Version
Using Options to Hedge a Portfolio

A few Cabot Options Trader subscribers have asked me about ways to protect gains in their portfolios, so I thought I would write to everyone with a couple of strategies using options to hedge your portfolio.

Options Education
From the questions I receive, I’m aware that a decent percentage of my subscribers have stock and/or options positions in a handful of stocks, including Apple (AAPL), Facebook (FB) and Alibaba (BABA).
Worried about another market correction? This bit of options education should help you learn how to hedge your portfolio using puts.
Options education is one of my main goals for Cabot Options Trader subscribers. And here are three important lessons I’ve been telling people lately.
Options education is one of my main goals for Cabot Options Trader subscribers. And here are three important lessons I’ve been telling people lately.
All options are a wasting asset whose time value erodes to zero by expiration. This erosion is known as time decay.
A protective put is used when a trader is bullish on a stock he is buying or already owns, but is wary of the stock’s short-term future. It is used as a means to protect unrealized gains, while giving the trader continued upside potential.
Combining Cabot Options Trader and Cabot Growth Investor
Below is an article I wrote a couple years ago in response to a subscribers’ question regarding options and option volatility around earnings.
I’ve received a ton of great emails from subscribers over the last couple of days about huge profits this year. I’m thrilled that you are making lots of money. That said, while it’s great that we are making good money, we must remember the risks as well.
The S&P 500 is down 0.5% this morning, though well off the overnight lows (lower by 1.25%) following news that Gary Cohn, President Trump’s top economic advisor, is leaving his position. As the market has heated up, I’ve received many great questions from subscribers.
As the market has rebounded just short of 2018 highs, an interesting and somewhat complex trade structure has become popular: 1x2 Bull Call Spreads.
As the market was falling apart and the VIX was exploding to multi-year highs, Cabot Options Trader Pro subscribers executed a short volatility trade, selling an Iron Condor. Here are the details of the trade and some of my commentary.