[00:00:01] I want to talk about futures daily options today and it's something I never used much when I was trading in Chicago at a prop firm or even much at all because they mostly only had weekly options when I was trading more futures during the day.
[00:00:18] And I've been in and out of that after a steadily doing it for about 10 or 12 years, it took a break and I was kind of bigger picture for a while and I'm back in it a little bit more now.
[00:00:27] And so the way I would describe it for me is I spent so much time studying screen recordings and key events and just big moves. Just got really intimate with how does a big move look? How does a retracement look when you have a theme that you think it's going to go up or down?
[00:00:42] How does it look when it turns? Does it look different when it fails? And I'd have all these checklist and I would look at them and just kind of get them into my memory.
[00:00:50] So then I had a lot of really good years just using those skills because I really perfected and studied how certain products acted when moves were going down on something stupid or they were actually something real.
[00:01:02] Like it kind of tell in the order flow a lot. And then I learned to use other correlations and other markets to kind of augment that or to kind of maybe poo poo it that it didn't matter as much.
[00:01:10] And then that became a bigger part of my trading was the themematic like looking at the bonds looking at the dollar understanding the themes people getting stuck doing something that you know should work but is not working and knowing that they're jammed up.
[00:01:23] And I still use that thinking a lot but my point is a lot of that stuff sort of got took away the last I don't know, it's slowly been going away as things get more automated more machine.
[00:01:33] So one of the things that I'm left with is I have all these years of market knowledge and like you know 15 and 20 years now actually are more a little bit over 20 of looking at S&P future so I have a good feel for it and I oftentimes can understand where it might go during the day.
[00:01:52] But the path there has been so treacherous that the futures the end of getting chewed up trying to scalp your way in and out in and out to you know an objective that you see.
[00:02:02] And that's why I was into the bigger picture stuff for a while which I still am doing that too on the side but this podcast is about futures options because I think that what they took away from all the all the in things change right it's not it's not like a I'm salty about it, but you know you learn something you study it and then it goes away and it comes back on certain days.
[00:02:21] But a lot of times generally speaking all that work I put in to watch the order books and to learn that stuff doesn't matter as much as it used to.
[00:02:29] And I've said this many times but what they took away in market you know it skills that I developed they added back with futures options daily future options because now.
[00:02:40] There's opportunities during the day where if you think there's a good chance in the next couple hours we're going to do this so when it's.
[00:02:47] Really far away from whatever this is sometimes your futures options are very cheap and you're risking you're locked in and you know your risks so you're like I'm risking. Two points or point and half in the S&P or NASDAQ whatever you're trading any product and.
[00:03:03] If I'm right I make 10 I make five I make 20 whatever it is whereas sometimes in the futures what would happen is I try that trade three times I get out of three losers and the trade works out and I'm just like oh my god.
[00:03:15] This is infinitely frustrating hard to move your size up that way so. In some ways the game has changed that way where if you can have an idea about the direction.
[00:03:26] And your patient there's just a lot more to do it to manage your risk and if you're risk if you make less money on options but you risk less you can option with your size up more because.
[00:03:37] Just by the by you know virtue of losing less money you need to make a less to go up because you're you can control the downside.
[00:03:44] Which back when I was starting now that it matters but just so you know I could lean on the book and say oh there's a big bid under me or I can feel it kind of click out what it would roll and like you can just feel and massage your way in and out of stuff now it's just like they just wipe the book out three three four points and.
[00:04:00] Everyone knows how it is now it's different so this is a way to kind of eliminate some of that so those skill the market knowledge skills and the directional skills don't go away they might be cut there it's a little harder than it used to be I think sometimes to find.
[00:04:13] To to key in ideas but you still there's still a lot of things that show up that I see but they don't show up the path there is harder so.
[00:04:23] I think that's a lot of things that are going to be done in the daily futures options which is they're exploding in volume I think they're going to come to all markets eventually I know golden oil and others so in the metals are three days a week but.
[00:04:33] I think it's a really good trend for a lot of us even if you're longer than a day just to manage your risk better and not feel frustrated that you don't get paid on your idea.
[00:04:43] It's really frustrating to do research and have an idea or believe in something and then you just keep getting beat up and it works out involved but there so.
[00:04:51] Anyways, that's really all I have to say is just look into it if you're interested in it if you're intimidated by it because it's not your thing.
[00:04:57] Just go on and we have all the knowledge in the world now videos and GPT and just basics you didn't even have to get complex you didn't need to do but you can do put put spreads call spreads you didn't even have to do all that stuff you could literally just do puts and calls and you you get better and better about how to how to do it.
[00:05:15] To apply the maximum leverage to your position and manage your risk and. If I've been doing a lot of that the last. Hey 69 months. This started a lot in early 2023 which I was not doing it.
[00:05:27] I was doing other things and but I'm on it now so it's been kind of brought back to breed the life into some of the things that I stop doing because of the. The volatility so you have to try.