232: Tips and Tricks for Navigating Options Expiration
The Option Alpha Podcast
Kirk Du Plessis
4.8 • 1.2K Ratings
🗓️ 7 August 2023
⏱️ 39 minutes
🧾️ Download transcript
Summary
Show Notes: https://optionalpha.com/show232
Navigating options expiration is a critical skill for traders, especially with the rise of daily expirations.
This week’s podcast explores the top 7 automated tips and tricks you can use inside Option Alpha to set up your portfolio for better options expiration management.
- Adjust exit options as you near expiration
- Check the extrinsic value of your positions/legs
- Check the probability of short legs being ITM
- Don’t use market orders, use defined limit orders
- Tag positions for their state so you can analyze performance later
- Setup alerts for low liquidity exit conditions
- Setup ‘critical’ alerts for positions between strikes of a spread
Transcript
Click on a timestamp to play from that location
| 0:00.0 | Expiration for options used to be only monthly, then in 2005, weekly options |
| 0:05.8 | expirations were introduced, followed by daily options expirations rolling out in 2022. |
| 0:12.4 | And this pace of more frequent expiration choices isn't slowing down, but rather accelerating, |
| 0:18.4 | which means navigating options expiration intelligently for traders is a critical skill. |
| 0:23.0 | So, this week on the podcast, we'll explore some tips and tricks on how you can set up |
| 0:27.0 | your portfolio to manage options expiration better. |
| 0:30.7 | After all, if you plan on being in the options trading business for more than just one |
| 0:34.6 | day, you're going to have to learn how to manage this expiration risk often. |
| 0:57.0 | Hey everyone, this is Kirk here again from Option Alpha working every single week to make |
| 1:02.1 | this the most popular investing podcast offered online because it's based on one thing and |
| 1:07.2 | one thing only and that's helping you consistently play smarter trades. |
| 1:11.1 | So again, thank you so much for tuning in back on today's show number 232, where we're |
| 1:16.8 | going to be talking through some tips and tricks about how you can navigate options |
| 1:21.0 | expiration. |
| 1:22.0 | And we haven't done an options expiration show in quite a long time. |
| 1:25.1 | And so now with some of the new stuff we can do with bots and automations, I figured |
| 1:28.9 | it would be a great opportunity to kind of revisit this and start exploring how we can |
| 1:34.1 | start integrating some of this stuff into our daily activities, basically our bot activities |
| 1:39.2 | and our automation activities to start making better decisions and to start managing expiration |
| 1:44.0 | risk a little bit easier. |
| 1:45.9 | Now if you haven't already go back and listen to after this show number 187, if you have |
| 1:51.2 | a lot of questions on expiration inside of that particular show, we went through 15 specific |
... |
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