April 15, 2025

Ep10 - Jumping into the Deep End of Covered Calls with Russell Rhoads

46 minutes

Episode Summary:

In this special episode, Dan Passarelli is joined by longtime friend and options expert Russell Rhoads—Associate Clinical Professor at Indiana University, former CBOE educator, and seasoned trader. They dive deep into real-world options education, covering everything from teaching college students about derivatives to building structured outcomes with options.

Topics Covered:

Why concepts matter more than complex math when teaching options

Covered calls and cash-secured puts as strategic investing tools

How to use implied volatility (IV) and the at-the-money straddle for strike selection

Surprising insights from Russell’s backtest on covered call strategies during earnings weeks

The evolving perception of options in retail vs. institutional circles

Understanding the VIX term structure and what today’s flat curve might be signaling

How to “become the issuer” of your own structured product using options

Why selling options—especially in calm markets—can give you the edge

Tips for navigating earnings season with confidence

Key Takeaways:

A consistent covered call strategy can outperform buy-and-hold—especially if you exit during earnings weeks

The at-the-money straddle is a powerful, underused tool for estimating expected moves and timing trades

Retail traders can learn to structure their own risk and reward profiles, just like institutional structured products

The VIX futures term structure reveals market uncertainty—and today's unusual flat curve might be a red flag

Guest Bio:

Russell Rhoads is an experienced options educator, researcher, and practitioner. He teaches at Indiana University’s Kelley School of Business and consults with financial exchanges. Previously, he was the Director of Education at the CBOE’s Options Institute.

Resources Mentioned:

Learn more about Dan: MarketTaker.com

For options disclosures: Characteristics and Risks of Standardized Options (PDF)www.theocc.com/getmedia/a151a9ae-d784-4a15-bdeb-23a029f50b70/riskstoc.pdf

Subscribe & Review:

Don’t miss the next episode, “Cash-Secured Puts: The Brother from Another Mother” – Subscribe now and leave a review to help grow the Wealth Building With Options community!

Disclosure:

Options involve risk and are not suitable for all investors. Prior to buying or selling an option, investors must read Characteristics and Risks of Standardized Options (ODD) which can be found at https://www.theocc.com/company-information/documents-and-archives/options-disclosure-document

Don’t trade with money you are not prepared to lose. Anything discussed on this show is intended to be generalized information and not intended to be a recommendation to buy or sell any security. The host and guests are not familiar with listeners’ specific situations. For trading information relevant to your specific needs, speak with a licensed broker or advisor.

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