The Options Insider Radio Network Options Boot Camp 337: The Mysteries of Dark Pools and Options Liquidity
May 8, 2025
Dive into the mysteries of options trading as the hosts dissect liquidity and dark pools. Discover trading strategies for stocks like Funko, Intel, and Nvidia while addressing listener questions. Unpack how to select stocks for cash-secured puts and assess options liquidity through daily volume and market spreads. Explore the fascinating role of dark pools and hear insights about the current trading landscape, complete with lively listener feedback and strategies to enhance your trading decisions.
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Funko's Risky Chart Decline
- Dan Passarelli describes Funko's stock chart as a nightmare, highlighting a sharp decline and a 'death cross' pattern.
- He advises thorough research before investing, reflecting the high risk in Funko's recent performance.
Selecting Stocks for Cash-Secured Puts
- When selecting stocks for cash-secured puts, use fundamental analysis to find undervalued stocks.
- Also consider premium yield by annualizing the premium against margin required for a balanced approach.
Quick Liquidity Checks
- To assess options liquidity quickly, start by checking the average daily volume (ADV) and bid-ask spread.
- Tight bid-ask spreads signal good liquidity; wide spreads warn of higher slippage and potential trading difficulty.