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  1. Phil

    Practice makes perfect (or at least the 60% winners we aim for) Yodi – great attitude that has served you very well.  

    Greeks/Burr – Must listen to this song while we discuss.  If you can make separate portfolios for long and short-term holdings, that would be a good idea because it's ridiculous to apply a single number to both when the strategies are completely different.  Vega, for example, is not useful at all for predicting the value of individual options, it's merely predicting the change in your portfolio as it, in turn, reacts to a change in volatility which, itself, is highly volatile as the VIX is out of control.  So think about what these instruments are really telling you when they are all measuring each other – not much…

     Your Theta's going to look like crap with 2015 longs (especially if they are covered) as your incremental daily gain is minimal, not to mention that, when the market goes up, the VIX goes down and diminshes the "value" of your longs while, when the market goes down, the VIX goes up and your short puts go way against you – so you get a highly inflated negative view of your portfolio that way.  Dan Passerelli is pretty good with the Greeks, if you're interested, he wrote a good book on them.  

    I will bet you that, if you ask Buffett what his Delta, Vega and Theta are he'll tell you – "How the Hell should I know" or something to that effect.  Delta is useful if you are not capable of simply seeing that "Gee, the Dow went up 100 points and my portfolio made $5,000 and Tuesday the Dow dropped 200 points and my portfolio lost $8,000" and then figuring out that you are $5,000 bullish to $4,000 bearish per 100-point move so 25% more bullish than bearish and then all you have to do is find a position that pays you $1,000 if the Dow drops 100 points (like our DIA puts) and PRESTO! you're neutral.  

    And we didn't even have to look at a single Greek…

    Cruise/Canuck – I love the name but I only like cruises with the kids, not my kind of thing in general.  Put the same guys at the Akropolis and I'd be happy to fly there.  They keep offering me free cruises if I do a seminar on the boat but I'm just not into that.  

    Cyprus/Lionel – Last I heard Russia said "F it – we'll lend them some money."  

    DIA/Dawn – Oh, it's those pesky fundamentals again!  I know you don't read the posts but, just a week or so ago, I did a whole analysis of the Dow and we determined it didn't have much further to climb and that some of its components, like FDX, were pretty well overbought and could easily correct on any disappointing news.  Why?  Well, I won't force you to read it – the answer is International Exposure, especially to Europe while the RUT is exposed over 80% to the US, which is in a marked recovery.  You can't keep going back to the well of "conventional market wisdom" as if macro circumstances don't matter – especially these days – they matter a hell of a lot.  

    Cyprus/StJ – I say let them all move to North Dakota and take up fracking.  

    Very nice on conference Terra, thanks!

    IWM/Dawn – Same thing.  

    Bitcoin/Cdt – I think that was BDC.  

    Austerity/StJ – Yep, I read that one.  Actually, what's really happening is that Corporations have become much more effective at capturing the benefits of an up cycle before it has a chance to trickle down to the broader economy.  

    So the real shrinking population is the number of people who are able to benefit from economic gains (though they certainly suffer all of the losses!).  

    Good luck with the house hunt Hemas.  Try Craig's list – they are very good for that sort of thing. 

    Sensor/StJ – That's fantastic.  Especially for diabetics, who have to poke themselves constantly.  

    PGH/Kinki – Must be ex-dividend day, then.  Well, for one thing, you want to buy them back to get your dividend – the cash is in your portfolio, so no big deal and the stock is down .02 this morning so no worries there.  I'd just jump right back in and sell the next sucker the Oct $5 calls (.65) and let them call you away and cancel the premium if they want to!  

    Actually folks, that's a nice, new play.  PGH pays out .12 TODAY and you can buy them for $5.39 and sell the Oct $5 puts for .65 and tomorrow, assuming they go lower, you can sell the $5 puts, that are currently .40, for maybe .50 and that would put you in for a lovely net $4.19/4.60 which makes the .47 annual dividend 11.2% while you wait to see if you get called away at $5 for another 19.3% gain in 7 months.  

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Zero Hedge

Walls, Going Viral

Courtesy of ZeroHedge. View original post here.

By Chris at

Market dislocations occur when financial markets, operating under stressful conditions, experience large widespread asset mispricing.

Welcome to this week's edition of “World Out Of Whack” where every Wednesday we take time out of our day to laugh, poke fun at and present to you absurdity in global financial markets in all it's glorious insanity.


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Market News

New You Can Use From Phil's Stock World


Financial Markets and Economy

Trillion-Dollar Payout May Mean Peak Largesse for U.S. Investors (Bloomberg)

A total $600 billion in share repurchases and $400 billion in dividends will be doled out by S&P 500 Index members by the end of the year, the biggest combined payout in history, according to strategists at Barclays Plc. Gravy like that is getting tougher to sustain as corporate profits suffer a six-quarter slump and cash levels begin to dwindle.

Deutsche Bank Could Be The “Lehman Moment” Of 2016 (Value Walk)


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What Millennials Reject Is Mutant Capitalism

By The Foundation for Economic Education. Originally published at ValueWalk.

It’s not exactly news that capitalism has an image problem. Say the word “capitalist” and the image that comes to mind is of a rapacious, self-interested robber baron – less Steve Jobs or Warren Buffett, more Charles Montgomery Burns.

Among young people, the problem is even more severe. For the generation who came of age during the financial crisis, argues George Koopman of the Mercatus Centre in the Wall Street Journal:

“…capitalism isn’t about free enterprise, nor is it about the startups and innovation. When they hear the term, millennials think about Wall Street bailouts, corporate greed, political scandals and tax codes riddle...

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Phil's Favorites

Another Lehman Blunder Coming Up?

Courtesy of Mish.

Telegraph writer Ambrose Evans-Pritchard says the Fed risks repeating Lehman blunder as US recession storm gathers.

The key problem with Pritchard’s superficial analysis is the Lehman bankruptcy is about the only thing the Fed got right.

Liquidity is suddenly drying up. Early warning indicators from US ‘flow of funds’ data point to an incipent squeeze, the long-feared capitulation after five successive quarters of declining corporate profits.

Yet the Fed is methodically draining money through ‘reverse repos’ regardless. It has set the course for a rise in interest rates in December and seems to be on automatic pilot...

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Kimble Charting Solutions

Bio-Tech; In more trouble if this fails, says Joe Friday

Courtesy of Chris Kimble.

At one point in time, actually for years, Bio-Tech (IBB) was a market leader. From the 2009 lows to 2015, IBB out gained the S&P by more than 250%. Since the summer of 2015, Bio Tech has remained a leader, a “downside leader!” IBB has lagged the S&P by over 35% in the past 15-months.

Is the downside leadership over for IBB? Below updates the pattern on IBB


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Chart School

SP500 Status Pre US 2016 Elections

Courtesy of Read the Ticker.

Where have we been, what does the future look like?

More from RTT Tv

NOTE: does allow users to load objects and text on charts, however some annotations are by a free third party image tool named

Investing Quote...

..."There is what I call the behaviour of a stock, actions that enable you to judge whether or not it is going to proceed in accordance with the precedents that your observation has noted. If a stock doesn’t act right don’t touch it, because, be...

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Members' Corner

The Orlando Massacre Part 3

Courtesy of Nattering Naybob.

A continuation of a Naybob of IT's Natterings from Part 1 and Part 2...

While many Christian churches expressed grief and offered free funeral services for the victims of the Orlando shooting, the fundamentalist Westboro Baptist Church held an anti-gay protest during the funeral of the victims.

But the Westboro Baptist Church's protest rally was blocked by about 200 people who formed a human barricade on the main street in downtown Orlando, ...

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Swing trading portfolio - week of October 17th, 2016

Reminder: OpTrader is available to chat with Members, comments are found below each post.


This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...

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Mapping The Market

The Most Overlooked Trait of Investing Success

Via Jean-Luc

Good article on investing success:

The Most Overlooked Trait of Investing Success

By Morgan Housel

There is a reason no Berkshire Hathaway investor chides Buffett when the company has a bad quarter. It’s because Buffett has so thoroughly convinced his investors that it’s pointless to try to navigate around 90-day intervals. He’s done that by writing incredibly lucid letters to investors for the last 50 years, communicating in easy-to-understand language at annual meetings, and speaking on TV in ways that someone with no investing experience can grasp.

Yes, Buffett runs an amazing investment company. But he also runs an amazing investor company. One of the most underappreciated part of his s...

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Digital Currencies

Gold, Silver and Blockchain - Fintech Solutions To Negative Rates, Bail-ins, Currency Debasement and Cashless

Courtesy of ZeroHedge. View original post here.

By Jan Skoyles

I was so pleased yesterday by the announcement that I have joined the Research team at GoldCore as it meant that I could finally start talking about it and was back in a role that lets me indulge in my passion by researching and geeking out on all things gold, silver and money.


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Epizyme - A Waiting Game

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

Epizyme was founded in 2007, and trying to create drugs to treat patient's cancer by focusing on genetically-linked differences between normal and cancer cells. Cancer areas of focus include leukemia, Non-Hodgkin's lymphoma and breast cancer.  One of the Epizme cofounders, H. Robert Horvitz, won the Nobel Prize in Medicine in 2002 for "discoveries concerning genetic regulation of organ development and programmed cell death."

Before discussing the drug targets of Epizyme, understanding epigenetics is crucial to comprehend the company's goals.  

Genetic components are the DNA sequences that are 'inherited.'  Some of these genes are stronger than others in their expression (e.g., eye color).  Yet, some genes turn on or off due to external factors (environmental), and it is und...

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All About Trends

Mid-Day Update

Reminder: Harlan is available to chat with Members, comments are found below each post.

Click here for the full report.

To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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PSW is more than just stock talk!


We know you love coming here for our Stocks & Options education, strategy and trade ideas, and for Phil's daily commentary which you can't live without, but there's more! features the most important and most interesting news items from around the web, all day, every day!

News: If you missed it, you can probably find it in our Market News section. We sift through piles of news so you don't have to.   

If you are looking for non-mainstream, provocatively-narrated news and opinion pieces which promise to make you think -- we feature Zero Hedge, ...

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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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