Editor’s Note: “X Marks the Spot?”…
Nate Tucci just got a cryptic message from one of our colleagues, Alex Reid.
What’s going on?
Hey y’all,
Yesterday, I promised that I’d focus on trading volatility this week, and for once, my attention span isn’t too short to follow up on that promise!
Today, we’ll be looking at each of our experts’ top tips for trading in times of volatility.
Here’s what they had to say:
Rule #1 – Risk Less
“There’s plenty of opportunity to trade and even trade more, but market swings in high-volatility environments can be tricky. “
“Going along with Chris… Trade small. Better to hit a lot of base hits than try to go for the home runs. Trade too much, and you can get wiped out quickly.”
“Know how much volatility you’re actually paying for. Most traders I talk to who trade options never even look to see what they’re paying for.
If you’re paying for huge expected moves 2,3,4 months out and then volatility comes down, those options are going to melt on you even if you get direction right.
Look for “boring” stocks where IV is reasonably low and an outsized move actually rewards you or, better yet, learn how to trade spreads.”
“Mortgage the house, the wife, the kids the dog… then… do YOLO’s!! (translation: “You Only Live Once!”) … put everything you got into one crazy meme stonk. That’s the only way to be an overnight gazillionaire… or be homeless next week.
See when you say it that way, it sounds nuts. So just go for consistent wins on high-quality stuff. If you don’t know what that is, maybe you should stop trading real money, and then you should follow someone with a great track record, see what they are doing.”
“Shhhhhh…in honor of Val Kilmer, we have been exploiting volatility big time with our TOP SECRET slam dunk trade of 2025. Daily trades, multiday trades…simply riding the wave of volatility. Seriously, it is way too easy…and as the name suggests, the trade is TOP SECRET”
Jamie is going to be spilling more details on his “top secret” trade in the coming weeks. But he also added this: “The VIX is an opportunity to print money if you know what you’re doing… but you have to be careful and play it smart.”
“For me, it’s to get a bit more aggressive on options selection (not position sizing) — with volatility we get routine big moves all the time – it’s a rare chance to go for 200%+ payouts with a realistic opportunity to profit.
To be specific, I typically use my Wrap Order in boring trending markets looking for 100% ROI on 1% moves… but in volatile markets, you can slide that out further out of the money and go for 200%, 300%+ moves… where your win rate MAY be only 50% but your losers will be -100% and your winners will be 300% so you net out 150% ROI on every 2 trades (in theory)”
I love all these insights, because they show that in any market environment, there are always creative ways to take advantage!
I hope they help you. More tomorrow!
To your prosperity,
Stephen Ground
Editor-in-Chief, ProsperityPub
