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TVS 023 – Trading Options with Kirk Du Plessis (Part I)

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TVS 023 – Trading Options with Kirk Du Plessis (Part I)

Today's episode we dive deeper into trading options with Kirk Du Plessis, who is the founder of Optionalpha.com, an educational option trading site. This episode and Part II are pa ...

Today’s episode we dive deeper into trading options with Kirk Du Plessis, who is the founder of Optionalpha.com, an educational option trading site. This episode and Part II are packed with great nuggets of information on how to trade options, calculating success of trades, and even Kirk’s entrepreneurial spirit in quitting banking and starting his own platform and company trading options. I hope that you enjoy this episode as much as I enjoyed interviewing Kirk.

Kirk also runs a successful options trading podcast which I used while learning to trade options.

  1. Kirk’s background in college, investment banking, REITs, and then starting trading options
  2. How to Calculate the success of a trade for options
    1. Implied Volatility
    2. Time Decay
    3. Calculating the standard deviation of stock price movement – (Stock price) x (Annualized Implied Volatility) x (Square Root of [days to expiration / 365]) = 1 standard deviation
      1. One standard deviation = 68% chance
  3. Mistakes to avoid while initially trading options
    1. Option size – 1-5% of portfolio size
    2. The frequency that you trade to hit law of large numbers
    3. Not being a net option seller
  4. How insurance companies are basically option sellers
    1. Warren Buffet selling over $5bn of options over the last few years
  5. Indicators to look for as a beginner trading options
  6. Aggressive vs. non-Aggressive strategies

As always, please let me know if you have any questions, comments, or suggestions. Email me directly at alan@thevampiresquid.com or on the contact form. Also, please subscribe to my facebook page for live updates facebook.com/thevampiresquid. Also follow me on Quora at https://www.quora.com/profile/Alan-Li-1. To support us check us out at Patreon https://www.patreon.com/thevampiresquid

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