Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

Options Trading

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How We Turn Volatility into Opportunity

As a lifelong member of the Sloper community, I’d like to begin with a heartfelt thank you to Tim and to all of you for creating a space where ideas flourish and market challenges are faced head-on. Being part of this group has been a privilege, and I continue to learn from the wisdom and camaraderie shared here. This shared wisdom has reinforced an important truth: volatility, while daunting to some, is often where the greatest opportunities lie for those willing to embrace it. It’s remarkable how many traders—some of them seasoned professionals—hesitate when faced with volatile markets. But the truth is, these conditions often present the greatest opportunities.

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AXON Bear Call Spread Breakdown

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Risk, Reward, and Position Sizing

Yesterday Tim offered a potential trade opportunity in Axon Enterprise (AXON). Here is the post for reference: Axon Trade Today, I want to share an alternative way to trade AXON—one that a professional options trader might consider when leveraging Tim’s expert technical analysis

A bear call spread, also known as a short call vertical spread, is one of my go-to strategies in options trading, primarily because of its defined risk and flexibility. As the name suggests, it’s a bearish strategy, but it doesn’t require the underlying stock to move lower to be profitable. Unlike buying or selling stocks, where outcomes are binary—up or down—a bear call spread can generate returns if the stock price stays flat, moves slightly higher, or declines. This versatility makes it a valuable tool for traders who want to align their positions with probabilities rather than predictions.

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Options with Gold

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Back on October 6, 2021 I posted an article titled, Embrace Volatility: Three Inflation-Based Options Strategies that Bet on the Financial Sector.

Within the article I discussed three different options strategies on the financial sector, as represented by the SPDR Financial Sector ETF (XLF). The beauty of options is that each approach either was, or remains, profitable.

Since then I’ve posted a few trade ideas on gold and another inflation hedge, each of which have made profits. Here is the most recent post, where I applied a bull put spread:

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Find the Best Stocks When Selling Options

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I’m often asked, “What’s the best stock for credit spreads?”

I’m dumbfounded by the question because it would require me to have a crystal ball, and unfortunately, my crystal ball broke decades ago. So, I can’t answer the question with any accuracy. And it’s exactly why I take a purely statistical approach to the market.

However, I can tell those that ask how to find the best stock for credit spreads, or any options selling strategy for that matter, using the following process.

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Short-term Extremes in Emerging Markets…Potential Trade?

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The market continues to teeter at the top.

Approximately 58.5% of the ETFs we follow in the daily options blog are in a short-term extreme state at the moment. Typically when we see levels this high a short-term reprieve follows.

One of the reasons the ratio is above 58% is the international ETFs. All of the highly-liquid international ETFs we follow are in a short-term extreme. India (EPI) is by far the most overbought at the moment, but it’s actually the emerging markets ETF (EEM) that has drawn my attention. (more…)