Get Your Copy of My Strategy Blueprints For FREE: 1) The Options Income Blueprint: optionswithdavis.com/blueprint/ 2) The Credit Spreads Blueprint: optionswithdavis.com/cs-blueprint/
Great video, Davis. I'm just a beginner options trader. After testing and practicing a few times in my paper account, I have a feeling this is going to be one of my everyday tools. 👍👍👍👍👍
Great content! Thank you! One thing though. Why would you use a red border for your thumbnails? That makes them look as they have been viewed already. I don't want to miss a video because it looks viewed.
Hi Davis, what if the call debit has better skew but the etf or stock is overbought or put debit has better skew but the etf or stock is oversold , the chances the stock going up is higher, we still can't trade right?
Thanks Davis. Good idea to think about skew before deciding to go long or short. So if stock is oversold and price is near or at support but skew favours short from risk reward ratio basis, do you ignore skew?
No. What I mean is to only trade a setup in the direction of the skew. So if a stock has call skew, you only find setups to trade to the upside. And vice versa for stocks with put skew. Doesn't mean you just randomly enter into trade. You still have to wait for the right setup before entering.
@@optionswithdavis oic. thanks for the clarification. so in the example of call skew which CHWY has... will it always be skewed towards call? or becos of some news or MM at play that resulted in the skew?
another great video! Question please: Certainly the skew is important but wouldnt you first consider other factors such as direction of underlying and more important- probability of success of trade? A better skew but not keeping in mind direction of underlying and probability of success can be disastrous. Please explain. Thank you
That's right, hence I mentioned to only trade in the direction of the skew IF there's a valid setup and not randomly enter just because there's a skew.
@@optionswithdavis First and foremost, great video! I am a beginner and learning at this stage. Can't believe I found your channel! I do have a question and hopefully you can answer (hopefully I am asking the right question too : O ). The example on CHWY, technical analysis looking bullish, use skew strategy as another check to increase the probability that the direction will be bullish or is just to increase the risk to reward ratio to grow small account fast? To me 2:1 (reward:risk) is mandatory when setting up call or put spread.
I would say that in this case with the SPY the skew is on the bearish side, because SPY trades mostly Bullish. As a lot of times mentioned, "there is always a tradeoff" or "there is no free lunch"...
He already mentioned it in his slides. Watch the video from beginning to end and you will see he clearly explained how skew helps this particular strategy.
The skew just means you get more reward for your risk. If it's put skewed, you'll have a potential profit that's greater than the cost of the spread. If it's put skewed and you buy a call spread, you will pay more than what your potential profit is
I am so happy that i made a productive decision about my finances that changed my life forever. I am a single Dad and i live in Florida, i bought my first house in September and i hope to retire at 50 if all goes well. Thanks to Mrs Judith M Layton for helping me achieve this.
Wow. I'm a bit perplexed seeing her been mentioned here also Didn’t know she has been good to so many people too this is wonderful, I'm in my fifth trade with her and it has been super.
I just withdrew my profits a week ago, To be honest it was an amazing feeling when the profits hits my wallet I wish I could reinvest but, too much bills
Get Your Copy of My Strategy Blueprints For FREE:
1) The Options Income Blueprint: optionswithdavis.com/blueprint/
2) The Credit Spreads Blueprint: optionswithdavis.com/cs-blueprint/
Thank you Mr. Davis. IMHO, hands down best options teacher on the 'Net.😀
You're too kind ☺️
Hi Davis, the DTE is still using 45 days?
Great video, Davis. I'm just a beginner options trader. After testing and practicing a few times in my paper account, I have a feeling this is going to be one of my everyday tools. 👍👍👍👍👍
👍
Another excellent video Davis. Your strategy videos are awesome, thanks!
You're welcome!
As ALWAYS wonderful, concise and relatively easy to follow.
☺️
How close to the expiry does itm positions have "real" risk of assignment?
Going to start my options journey soon! See you at the top 💪
Great content! Thank you! One thing though. Why would you use a red border for your thumbnails? That makes them look as they have been viewed already. I don't want to miss a video because it looks viewed.
Thanks for the feedback. Will keep this in mind for future videos 👍
this was great. thank you. can you use this on index optionis like SPX or NDX?
Thanks David! What is the DTE? Is it still 45? Also, would you conider overbought oversold patterns?
Consider
Hi Davis, what if the call debit has better skew but the etf or stock is overbought or put debit has better skew but the etf or stock is oversold , the chances the stock going up is higher, we still can't trade right?
Thanks Davis. Good idea to think about skew before deciding to go long or short. So if stock is oversold and price is near or at support but skew favours short from risk reward ratio basis, do you ignore skew?
If you want the added advantage of skew, then choose the setups that favors the skew.
@@optionswithdavis are you saying to trade the direction just by where the skew favours and ignore what other technical indicators tell you?
No. What I mean is to only trade a setup in the direction of the skew. So if a stock has call skew, you only find setups to trade to the upside. And vice versa for stocks with put skew. Doesn't mean you just randomly enter into trade. You still have to wait for the right setup before entering.
@@optionswithdavis oic. thanks for the clarification. so in the example of call skew which CHWY has... will it always be skewed towards call? or becos of some news or MM at play that resulted in the skew?
Thank you!
👍
thanks 🤝
Welcome!
Thanks, Davis. I always wonder about the meaning of skew. I only skew I know is the BBQ skewers. lol
😂
Unlike the credit spreads, you must be right with the direction to be profitable.
Correct
I'm curious about two things:
1. What DTE do you shoot for on a debit spread
2. What is your exit strategy on debit spreads?
I use TOS also, how do I get the setup/screen display that you have???
Could I assume you trade this strategy selecting oversold or overbought tickers and based later on the skew, right?
another great video! Question please: Certainly the skew is important but wouldnt you first consider other factors such as direction of underlying and more important- probability of success of trade? A better skew but not keeping in mind direction of underlying and probability of success can be disastrous. Please explain. Thank you
That's right, hence I mentioned to only trade in the direction of the skew IF there's a valid setup and not randomly enter just because there's a skew.
@@optionswithdavis First and foremost, great video! I am a beginner and learning at this stage. Can't believe I found your channel! I do have a question and hopefully you can answer (hopefully I am asking the right question too : O ). The example on CHWY, technical analysis looking bullish, use skew strategy as another check to increase the probability that the direction will be bullish or is just to increase the risk to reward ratio to grow small account fast? To me 2:1 (reward:risk) is mandatory when setting up call or put spread.
Great video as always 🎉
☺️
only TOS has these details?
Great job, thank you! I wonder if SPY and other ETF's have put skew because of their natural positive drift over time?
I would say that in this case with the SPY the skew is on the bearish side, because SPY trades mostly Bullish. As a lot of times mentioned, "there is always a tradeoff" or "there is no free lunch"...
@@thomaskreisel5764 yep, exactly what I was thinking!
@thomaskreisel5764 yes sir, that's exactly what I was thinking
I think this strategy is better for low IV enviroment, because its essentially a buying strategy, right?
You explained about call versus put debit spread. However you did not mention where skew fits in here. Can you clarify?
He already mentioned it in his slides. Watch the video from beginning to end and you will see he clearly explained how skew helps this particular strategy.
It's explained through the whole video smh
If you actually watch the whole video, you'll see it's mentioned in there 😉
The skew just means you get more reward for your risk. If it's put skewed, you'll have a potential profit that's greater than the cost of the spread. If it's put skewed and you buy a call spread, you will pay more than what your potential profit is
I am so happy that i made a productive decision about my finances that changed my life forever. I am a single Dad and i live in Florida, i bought my first house in September and i hope to retire at 50 if all goes well. Thanks to Mrs Judith M Layton for helping me achieve this.
Wow. I'm a bit perplexed seeing her been mentioned here also Didn’t know she has been good to so many people too this is wonderful, I'm in my fifth trade with her and it has been super.
I just withdrew my profits a week ago, To be honest it was an amazing feeling when the profits hits my wallet I wish I could reinvest but, too much bills
You trade with Judith M Layton too? Wow that woman has been a blessing to me and my family
Please let me know how to contact her as I'm new to this.
I was skeptical at first until I decided to try. It’s huge returns is awesome! I can’t say much.
please compile to excel thanks