Options Boot Camp

What can bond market volatility tell you that the VIX can't? Mark Longo and Dan Passarelli break down the MOVE Index and explain why equity options traders should keep an eye on Treasury yield volatility.

Learn what MOVE measures, how its Treasury options components are weighted, and why comparing its level directly with VIX can be misleading. Mark and Dan also explore what it means when stock and bond volatility diverge, how to interpret implied daily moves, and the usefulness and limitations of MOVE as a market indicator.

Plus, the latest listener poll on NVIDIA's stock buyback and a Market Taker Question of the Week: Do shorter-term options always offer sellers faster time decay?

When does an option actually stop trading, and what happens when expiration arrives? Mark Longo and Dan Passarelli trace how the calendar grew from monthly expirations to weeklies, daily SPX options, and Monday and Wednesday expirations in select stocks and ETFs.

Along the way, they explain why traditional SPX monthly options can stop trading on Thursday yet settle on Friday morning, how cash settlement differs from physical settlement, and why expiration day can catch traders off guard. They also share stories from the trading floor and answer listener questions.

Yacht rock piracy meets options strategy on this episode of Options Boot Camp.

Mark Longo and Dan Passarelli break down Dan's "net zero roll" for cash-secured puts, including how traders can roll down and out while targeting little or no net premium on the adjustment. They also tackle a fresh batch of listener questions covering how implied volatility can help determine whether to buy calls, sell puts or use call spreads; how much open interest and volume really matter when selecting a strike; what steep put skew can reveal when VIX isn't moving; and whether traders put too much emphasis on dealer gamma positioning.

Plus, the Boot Camp crew digs into pin risk in the era of daily and short-dated expirations, looks at which options strategies might deserve the full book treatment, checks in on the latest 0DTE butterfly poll results and, naturally, investigates Dan's alleged yacht rock piracy on the Chicago River.

The iron butterfly is getting a 0DTE makeover.

On this episode of Options Boot Camp, Mark Longo is joined by Dan Passarelli and John Kmiecik from Market Taker Mentoring for a deep dive into the growing world of zero-days-to-expiration iron butterflies.

Why are traders turning to this classic options strategy for ultra-short-term trades? John breaks down how he approaches 0DTE iron butterflies, including timing his entry after the open, choosing spread widths, setting profit targets, managing risk, and taking advantage of changes in implied volatility and time decay.

The crew also explores 0DTE double calendars, whether these strategies could work in single-stock options, managing a calendar that has moved away from its strike, and the most overrated advice in options trading.

Is the earnings volatility worm finally starting to turn?

On this episode of Options Boot Camp, Mark Longo and Dan Passarelli dig into the latest earnings options data and examine whether the recent run of dominance for premium buyers may finally be losing steam. They break down how actual earnings moves are stacking up against what the options market priced in, whether traders should be rethinking the buy-vs.-sell premium equation, and how Dan approaches earnings trades using time spreads, double calendars and other volatility strategies.

Plus, the Boot Camp instructors tackle IV Rank, zero-DTE butterflies, buy writes, options volume by exchange, binary options and prediction markets, and much more.

On this episode of Options Boot Camp, Mark Longo and Dan Passarelli tackle the challenges and opportunities of trading options in a low-volatility market.

Should you still be selling premium when volatility is cheap, or does low vol make buying options more attractive? Are single-stock options offering better opportunities than index options in the current dispersion environment? The Boot Camp instructors break down how they're approaching these markets and where they're still finding opportunities.

Then they examine the strange recent VIX glitch that briefly sent the cash index soaring while VIX futures barely moved. What caused it? Could traders actually take advantage of it? And could resting "wishlist" orders help you capitalize when markets briefly get out of line?

Plus, the instructors discuss the biggest forces driving the market right now, revisit perpetual futures, and share an update on the potential Options Boot Camp reboot.

Topics include:

• Trading options in a low-volatility environment
• Buying options vs. selling premium when volatility is cheap
• Single-stock options vs. index options
• Dispersion and individual-stock volatility
• The mysterious VIX glitch
• Why VIX futures didn't follow the cash spike
• Using resting "wishlist" orders for unusual market moves
• Perpetual futures and market liquidity
• What's driving the market right now

What the heck are PERPS—and why are they suddenly everywhere?

On this episode of Options Boot Camp, Mark Longo and Dan Passarelli tackle one of the hottest topics in the derivatives world: perpetual futures, better known as perps.

They break down how perpetual futures work, why they don't have expiration dates, how they differ from traditional futures contracts, and why eliminating expiration also eliminates the need to constantly roll positions. Then they dive into the all-important funding rate—the mechanism designed to keep perpetual futures prices aligned with the underlying market.

Using easy-to-follow examples, the hosts explore what happens when a perp trades at a premium or discount to the underlying, who pays the funding rate, how professional traders may respond, and why the mechanics can vary significantly from one trading venue to another.

They also discuss the growing interest in perps across the derivatives industry, the comparison between perpetual futures and 0DTE options, and why options traders should understand this increasingly important product.

Plus, in the Mail Call, the crew discusses whether it might finally be time to revisit and remaster some of the earliest Options Boot Camp episodes for a new generation of options traders.

Topics include:

• What are perpetual futures (perps)?
• Perpetual futures vs. traditional futures
• Why perps don't expire
• How funding rates work
• Positive vs. negative funding rates
• Perps trading at premiums and discounts
• Arbitrage and price convergence
• Perpetual futures vs. 0DTE options
• The growing role of perps in derivatives trading
• Revisiting the early days of Options Boot Camp

The double calendar saga continues!

On this episode of Options Boot Camp, Mark Longo and Dan Passarelli head back into the trenches for another deep dive into double calendar spreads—this time focusing on one of the biggest questions from listeners: How do you actually manage these trades once they're on?

Dan breaks down his approach to double calendar management, including what happens when the underlying tests a strike, why modeled break-even points matter, when he takes profits, and when it's time to cut bait. The discussion also explores using double calendars in SPX versus individual equities and whether this strategy could provide an interesting alternative way to capture weekend market moves.

Then it's time for listener questions covering:

• When low volatility makes outright calls or puts more attractive than debit spreads
• How Dan selects strikes when trading the wheel
• The role of technical levels and premium when selling options
• What happens when you correctly predict a stock's direction but still lose money to an implied volatility collapse
• Why volatility analysis matters before entering an options trade

It's Double Calendars Part 2. The stakes are higher. The calendars are doubled. And this time...it's Electric Boogaloo!

What do double calendar spreads and the Fall of Constantinople have in common? More than you might think.

On this episode of Options Boot Camp, Mark Longo and Dan Passarelli use a memorable historical analogy to explain one of Dan's favorite advanced options strategies: the double calendar spread.

The discussion covers:

• What a double calendar spread actually is
• Why it can be viewed as a "strangle swap"
• How Dan structures weekly double calendars
• When he typically enters and exits the trade
• Why wider breakevens aren't always guaranteed
• A recent SPX double calendar example
• Managing profits and avoiding common mistakes

Then it's time for listener questions covering:

• Selling cash-secured puts versus covered calls near market highs
• Trading calendars and diagonals during earnings season
• Whether buying options into earnings still makes sense
• Scaling into positions
• Weekly SPY options and whether traders are sacrificing edge for more opportunities

The Warren Buffett conversation continues!

After the response to our 400th episode, Mark Longo and Dan Passarelli head back to the mailbag to tackle even more listener questions about the Oracle of Omaha and his approach to options.

On this episode, we discuss:

• Are covered calls compatible with Buffett's buy-and-hold philosophy?
• Would Buffett ever use LEAPS instead of buying stock?
• Is "getting paid to wait" really the same thing as selling option premium?
• Does Buffett care about implied volatility when selling options?
• How might Buffett use options once he owns a stock he plans to hold forever?
• The unusual economics behind some of Buffett's legendary long-term put trades
• Why the "magical Buffett premium" may be something ordinary options traders can only dream about
• Plus, a trip deep into the Options Boot Camp archives