Written by A.J. Brown

Ep. 4 - The Three Dimensions of Vertical Spreads

Probability Theory In The MarketsWe’re back again! My friend, head coach, and trading peer, Jason and I are back with our fourth episode of our video training serial on vertical spreads. Every week we intend to bring you a new episode.

In this episode we introduce graphs of implied volatility values to visualize vertical skew and describe how to interpret them. We talk about how you can adjust your probability outlook by gleaning important information from these vertical skew graphs.

Lets roll with episode 4 of our video training. Please, comment with any questions or comments you might have.

To your good trading.

A.J. Brown

5 Responses to “Ep. 4 - The Three Dimensions of Vertical Spreads”

  1. Jay @ 6:32 am:

    I am finally starting to understand implied volatility and deviations. This is a great concept using the short segments to present the ideas. It is very easy to understand and since the segments are only around ten minutes or less it is EXTREMEMLY easy to review! Great Job and I look forward to the next episode. Thank you!

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  2. Mercedes @ 8:23 pm:

    Thanks a lot AJ And Jason.

    I am looking forward to the next episode. This is very helpful and would like to have the edge when placing my vertical spread.

    Mercedes

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  3. mike @ 12:41 pm:

    AJ, Jason, great series. I have a better understanding on how spreads react short term and a better understanding of negative skew. Thanks for the good series

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  4. Mark Michael Lewis @ 11:43 am:

    This mindset shift, from:
    1. choosing trades based on the current value of the underlying asset to its future (in my opinion) value of the asset, to
    2. trading the current implied volatility vs. the future (in my opinion) implied volatility

    is a whole new game.
    Thanks for laying this out 1 step at a time so I can get my head, and my trading strategies around it! More MOre more!!!

    Mark

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  5. Mary Workman @ 11:35 am:

    Wonderful information - Thank you! I thought the details on Trading the Skew were really interesting.

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