The Option Block

Trading Block: Earnings today include: AMC Entertainment Holdings, Loews Corporation (before), and Dunn & Bradstreet, General Growth Properties (after). U.S. stocks pressured as oil losses mount. Crude back below $40. BATS to launch "BAM" Options Auctions, offering competitive price improvement opportunity.

Odd Block: Calls selling and buying in MetLife (MET), calls selling in FDC First Data Corp (FDC), and LEAPS put buying in Trina Solar Limited (TSL).

Strategy Block: Uncle Mike Tosaw discusses portfolio margining

Options Question of the Week: What is most important to you when choosing an options broker?

• Commissions
• Platform Features
• Support/Service
• Educational Offerings

Around the Block: Earnings Highlights for the Week.

• Tuesday: Avis Budget Group, CVS Health Corporation, Ecolab, Electronic Arts, Etsy, Fitbit, Intercontinental Hotels Group, La Quinta, Pfizer, Potbelly Corporation, Royal Caribbean Cruises
• Wednesday: Cedar Fair, Crocs, GoDaddy, Herbalife, Intercontinental Exchange, Office Depot, Tesla Motors, Time Warner, Twenty-First Century Fox
• Thursday: Activision Blizzard, Almo Group, AMC Networks, Bats Global Markets, HH Gregg, Icahn Enterprises, LinkedIn Corporation, Lions Gate Entertainment Corporation, MGM Resorts International, Nokia Corporation, Starwood Property Trust, Time Inc, Weight Watchers International, Zillow
• Friday: Virgin America

Trading Block: Big news! OptionsHouse is now the sponsor of The Option Block.

Earnings today include CME, FORD, DOW.

• Ford off nearly 9%
• AMZN: $748.50. ATM Straddle approx. $50, 6.6%
• GOOG: $742. ATM Straddle approx. $38.50, 5%.

Odd Block: Calls trade in ETSY Inc. (ETSY), calls trade in The Technology SPDR (XLK), calls and puts trade in Yandex NV (YNDX)

Mail Block: Listener questions and comments

• Question from AWorth: Can the Options House guys explain how their short buyback program works? Is it only for outright shorts, or if I have a short leg of a spread that is near the money on expiration but trading under $.10, can I close that out without commission or do I have to close the whole spread?
• Question from Thomas Hatch: I like dividend yield stocks. I listened to an earlier show and you mentioned writing covered calls to generate dividends. Can I apply this strategy to dividend yield stocks? Any risks I should watch out for when doing this?
• Question from 777: Are you aware of any specific gold arb between chinese gold derivatives and their U.S. equivalents?

Around the Block: Earnings on Friday include CBOE, Exxon-Mobil (XOM), Merck (MRK) and UPS (UPS). This weekin the market sees GDP, Consumer Sentiment on July 29.

Trading Block: Earnings! Not many earning today, but a big week is ahead. Apple after the bell tomorrow. Stock at $97.27, ATM Straddle approx. $2.90, or 3%. Oil prices fell to two-and-a-half month low. Verizon owns the internet from the 90s, AOL last year, Yahoo today.

Odd Block: Calls trade in Crown Castle Inter. (CCI), call buying in Bank of America (BAC), call selling in iShares MSCI Japan ETF (EWJ), and put selling in Lululemon Athletica Inc. (LULU).

Strategy Block: Uncle Mike Tosaw discusses selling put spreads on a dip in the marketplace.

Around the Block: Upcoming earnings include:

• AMZN
• F
• GOOG
• TWTR
• FB

Trading Block: Most major markets off 0.5% or more. VIX cash watch. Earnings today (before) Dunkin Brands,General Motors, Marriott Vacations, Southwest Airlines; (after) AT&T, Chipotle Mexican Grill, E*Trade Financial (ETFC). Apple Watch is a flop!

Odd Block: Calls trade in Nobel Corporation (NE), calls trade in Teucrium Corn Fund (CORN), calls and puts trade in Ebay Inc (EBAY), and calls trade in Mattel Corp (MAT).

Mail Block: Listener questions and comments....LIVE!

• Size aside, what are the primary benefits of using SPX instead of SPY.
• What is going on in the VIX Aug 13 puts?
• Which names are the most reliable premium writes each quarter?
• Is there a tradeable pair between VIX and another member of the family of volatility products?
• What to do with the upcoming UVXY reverse split?

Around the Block: Earnings on Friday: American Airlines, General Electric Company, TCF Financial, Whirlpool Corporation.

Trading Block: The coup that wasn't. Earnings today include Bank of America, Hasbro, Charles Schwab Corp., (before) and IBM, Netflix, Yahoo (after). A Brexit swoon boosts US options volume to a 10-month high.

Odd Block: Size puts in IZE iShares MSCI Turkey Market Index ETF (TUR), calls trade in Nobel Energy (NE), calls trade in Market Vectors Russia ETF (RSX), and calls and puts trade in ArcelorMittal SA (MT).

Strategy Block: Uncle Mike Tosaw diagonal spreads and when to know the market is at a low.

Around the Block: Earnings!

• Tuesday: Discover Financial Services, Electronic Arts, Goldman Sachs, Interactive Brokers, Microsoft Corporation, TD Ameritrade
• Wednesday: Abbott Labs, American Express, eBay, Intel Corporation, MB Financial, Morgan Stanley, Northern Trust
• Thursday: AT&T, Chipotle Mexican Grill, Dunkin Brands, E*Trade Financial, General Motors, Marriott Vacations, Pandora Media, PayPal, Southwest Airlines, Visa, Inc.
• Friday: American Airlines, General Electric Company, TCF Financial, Whirlpool Corporation

Trading Block: Earnings today include: JPMorgan Chase, Delta Air Lines. Legislation to impose financial transactions tax introduced. Clinton aims "Wall Street" tax at Flash Boys, not banks.

Odd Block: Calls trade in ConAgra Foods Inc. (CAG), calls trade in HollyFrontier Corp (HFC) and calls trade in Credit Suisse Group (CS).

Mail Block: Listener questions and comments

• Question from Dmitry: What happens to Leaps for tickers that get delisted before expiration?
• Question from Mark Davis: Hello, I am a new listener. There was a mention of using covered calls to generate a "dividend". I am having trouble tracking down more information on this. Being still new to all of this, I am hoping to get a clearer picture of how it works. How far out on expiration should I look at to figure the stock price? Thanks!

Around the Block: Earnings on Friday include Citigroup, PNC Financial Services, US Bancorp, Wells Fargo

Trading Block: Today we have a specail co-host, Steve Claussen, Chief Investment Strategist, OptionsHouse. What do the all-stars discuss?

• Earnings today: Alcoa Inc. ATM Straddle approx. $.65-6.5%.
• The S&P hits new all-time high, Nasdaq above 5,000.
• CBOE to list SPX Monday-expiring Weeklys Options.
• Pokemon Go craze sends Nintendo stock soaring.

Odd Block: Short-term bulls go shopping at Macy's (M); calls trade in Sprouts Farmers Market Inc. (SFM); calls trade in Lifelock Inc (LOCK), and; puts trade in Deutsche Bank AG (DB)

Strategy Block: Uncle Mike Tosaw discusses alternatives to covered call trading.

Mail Block: Listener questions and comments

Around the Block: Earnings!

• Wednesday: Yum! Brands, Inc.
• Thursday: JPMorgan Chase, Delta Air Lines
• Friday: Citigroup, PNC Financial Services, US Bancorp, Wells Fargo

Trading Block: Post-Brexit market update. OCC Cleared contract volume up 11% in June. The urgency of the Fed to hike has faded away as Brexit further clouded the outlook. SEC approves NYSE request for new market volatility rules.

Twitter Poll Options Question of the Week: Which products' performance post-#Brexit surprised you the most?

• 43%: Volatility (VIX, etc)
• 0%: Rates (10yr, etc)
• 52%: Equity Index: (SPY, etc)
• 5%: FX (GBP/USD, EUR/USD etc)

Odd Block: Size call seller in Kinross Gold Corp (KGC), call buyer in General Electric (GE) and put seller in Interval Leisure Group Inc (IILG)

Mail Block: Listener questions and comments

• Question from RazMichaghian: Info on how to set my stock scan on TOS on pre meters? Thank you
• Question from JViz: Why do people trade options with stock? Why do they buy calls and then sell stock in the same trade? What advantage does that offer?
• Question from AJones: Shame about Mini options. Great breakdown of the failing that doomed that product. Are there any other products out there that surprised you-either with their success or failure?

Around the Block: Friday, July 8: The health of the job market (Non Farm Payrolls Report)

Trading Block: Earnings today before the bell: ConAgra. U.S. lawmakers seek more money, authority for derivatives regulators. CFTC charges ex-Chicago Board Options Exchange director with fraud.

Options Question of the Week Twitter Poll: Where will $VIX close on Friday in this first trading week post-#Brexit? #QOTW

• 6%: Above 25
• 13%: 22-24.99
• 22%: 19-21.99
• 59%: Below 19

Odd Block: Calls go up in Hershey Co. (HSY), call buyers in Mondelez International Inc. (MDLZ), and put spread buyers in Encana Corp (ECA)

Mail Block: Listener questions and comments

• Comment from Frank: @OpenOutcrier He must have ripped off somebody really important then...
• Comment from BruceX555: Some nimble-footed traders have made a lot on Brexit, and I reckon plenty have lost plenty.
• Question from Robert K.: ‏Hi, on a debit spread is the most you could lose is your credit?
• Question from Tor: Hello, I am (restarting) my options trading on a shoestring; any thoughts on mini-options? Thanks.

Around the Block: Vol coming in due to holiday weekend. Non-farms next week. Will there be a selloff due to quarter end? Will bonds come down at all? Mike is married....in gold.

Trading Block: Brexit provides a review of pitfalls for options and futures traders. Oil extends decline as Brexit fallout spurs market volatility. Could the Fed potentially reverse course and cut rates?

Odd Block: Calls trade in Crown Castle Inter. (CCI), puts trade in Starbucks Corporation (SBUX)

Strategy Block: Uncle Mike Tosaw discusses how to select the correct collar size.

Listener Mail: Listener questions and comments

• Question from David Shanabrook: Can you check the $AAPL weekly options for this week? Huge open interest (put and call) at $100, $105 accelerated repurchase by Apple? What is the effect?

Around the Block: Earnings!

• Tuesday: Nike, Inc.
• Wednesday: General Mills, Monsanto Company, Pier1 Imports
• Thursday: ConAgra Foods