The Volatility Shift No One Sees | What the Options Market Says About What Comes Next

8 snips

Jan 17, 2026

Brent Kochuba, co-founder of SpotGamma and an expert in options market analysis, joins the discussion to unveil the intricate dance of options flows and equity markets. He explores the explosive growth of zero DTE options and their profound impact on market behavior. Brent shares cautionary insights from the Captain Condor collapse, showcasing the risks of selling volatility. The conversation highlights how dealer hedging shapes stock movements, the significance of options expiration, and crucial volatility dynamics that even long-term investors should heed.

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ANECDOTE

Captain Condor's Zero-DTE Collapse

David Chow ("Captain Condor") ran large zero-DTE condor trades and doubled down after losses until a quiet day wiped him out.
That sequence produced roughly $30–50M losses and harmed many subscribers who followed his paid signals.

INSIGHT

Options Growth Is Reshaping Market Structure

Options volume has surged ~150% since COVID while stock volume rose ~30%, shifting market structure.
That growth makes hedging flows from market makers materially move underlying stocks and indices.

ADVICE

Use OPEX As A Tactical Risk Window

Watch options expiration windows because dealer hedges force position shifts that can catalyze rallies or reversals.
Use OPEX dates to reassess tactical positioning and risk ahead of forced hedge unwind and rebuild.

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In this episode, Jack Forehand is joined by Brent Kochuba from SpotGamma to break down how options market flows are increasingly shaping equity market behavior. The conversation focuses on January options expiration, the explosive growth of zero DTE options, and why short term volatility dynamics matter even for long term investors. Using recent market examples, the episode explains how dealer hedging, gamma exposure, and correlation shifts can drive rallies, reversals, and sudden corrections that often seem disconnected from fundamentals.

Topics covered
• Why options volume has surged since 2020 and how zero DTE trading changed market structure
• How dealer hedging flows influence stock prices, volatility, and intraday market moves
• The Captain Condor collapse and what it reveals about selling volatility and hidden risks
• Why options expiration can act as a catalyst for market turning points
• The relationship between implied volatility, realized volatility, and market stability
• Gamma exposure explained and how positive vs negative gamma affects price action
• Correlation trades and why low index volatility can signal growing market fragility
• What current options positioning says about risks and opportunities after January opex

Timestamps
00:00 Introduction and why options flows matter for all investors
03:00 What the show is about and how options expiration drives market behavior
06:00 The Captain Condor story and the dangers of selling volatility
15:20 Why options volume has exploded since COVID
18:45 How market makers hedge options and move underlying stocks
22:00 Why options expiration forces positioning changes
25:00 Volatility behavior before and after opex
27:45 Gamma exposure and how it predicts short term volatility
29:50 December opex review and what played out as expected
36:00 Correlation trades and warning signals for corrections
44:40 Single stock options, speculation, and market maker profits
46:30 Quadrant view of call buying, volatility, and crowd behavior
49:55 Implied vs realized volatility and why tension is building