How can I find stocks with very active options chains?
"Just as a matter of research, apparently there is a way to find high option volumes such as a site here: https://www.barchart.com/options/volume-leaders/stocks However, that information is going to be heavily skewed by ""underlying security that moved a lot more than expected and probably got a lot of positions filled incidentally today"", but I think it is a good place to start building up a list of securities with a lot of option interest. There is also a tab there for ETFs. This will not tell you exactly that a particular stock always has high option volume, but most of the ones that show up there repeatedly and across multiple strike prices will meet your criteria." If you're willing to shell out some cash, vendors will be quite happy to sell you everything you need. Picking one out of thin air, and no idea if this is a good price or not, the CBOE will sell you EOD data for every option for $40 for one day, and at a discount for multiple days.  Beyond the high/low/close for each contract, you get the volume. Or a month of TAQ data will run your $1550, for what that's worth, which probably isn't a lot for a retail strategy. Agree with some of the posts above - Barchart is a good source for finding unusual options activity and also open interest -https://www.barchart.com/options/open-interest-change
"&gt; Well, first of all, how do you define ""executive,"" and how do you differentiate between executives who had a hand in ruining the company, and those that didn't?   If you're in a VP+/Director position, you don't get blindsided by this shit no matter what which division you're responsible for unless the company has serious communication issues -- which is a tell in and of itself.  &gt; Second, ""executives"" tend to be flexible, mobile, and have ""fuck you"" money. Turn off their salaries, and they'll just leave.  I don't find that a very compelling argument. It's the same as the old ""You can't tax the rich, they'll just move!"" argument, and should be solved much the same way. Okay, let 'em quit. Any stock options they have / other benefits get cashed out and applied to outstanding debts accrued under them before any payout reaches them. They can walk if they want, but they're going to feel it when they go.  &gt; I know Reddit has this fantasy where executives don't do anything but golf and drink all day, but you can't run a company with an empty C-Suite.   I don't pretend that they do, but by the same metric I don't believe that many are worth anywhere near as much as they get paid -- and especially not when they're producing results like this." http://dailyfinance.com Enter a stock ticker, then click on the Chain link to the left. Then, click on the option tickers to see their charts. EDIT: the site has changed, and there are no more option charts. So why are option charts so tough to find? Options are derivatives of the stock. Option prices are defined by a formula. The inputs are stock pricxe, strike, days to expiration, dividend, risk-free interest rate, and volatility. Volatility is the only thing that cannot be easily looked up. With a Black-Scholes calculator, and some reasonable volatility selections, it's possible to make your own fairly accurate option chart. I don't think it's very enlightening, though. The interesting things are: the stock price movement (as always), and the nature of option pricing behavior in general (understanding how the formula represents crowd behavior). "There are two umbrellas in investing: active management and passive management. Passive management is based on the idea ""you can't beat the market."" Passive investors believe in the efficient markets hypothesis: ""the market interprets all information about an asset, so price is equal to underlying value"". Another idea in this field is that there's a minimum risk associated with any given return. You can't increase your expected return without assuming more risk. To see it graphically:   As expected return goes up, so does risk. If we stat with a portfolio of 100 bonds, then remove 30 bonds and add 30 stocks, we'll have a portfolio that's 70% bonds/30% stocks. Turns out that this makes expected return increase and lower risk because of diversification. Markowitz showed that you could reduce the overall portfolio risk by adding a riskier, but uncorrelated, asset! Basically, if your entire portfolio is US stocks, then you'll lose money whenever US stocks fall. But, if you have half US stocks, quarter US bonds, and quarter European stocks, then even if the US market tanks, half your portfolio will be unaffected (theoretically). Adding different types of uncorrelated assets can reduce risk and increase returns.  Let's tie this all together. We should get a variety of stocks to reduce our risk, and we can't beat the market by security selection. Ideally, we ought to buy nearly every stock in the market so that  So what's our solution? Why, the exchange traded fund (ETF) of course! An ETF is basically a bunch of stocks that trade as a single ticker symbol. For example, consider the SPDR S&P 500 (SPY). You can purchase a unit of ""SPY"" and it will move up/down proportional to the S&P 500. This gives us diversification among stocks, to prevent any significant downside while limiting our upside. How do we diversify across asset classes? Luckily, we can purchase ETF's for almost anything: Gold ETF's (commodities), US bond ETF's (domestic bonds), International stock ETFs, Intl. bonds ETFs, etc. So, we can buy ETF's to give us exposure to various asset classes, thus diversifying among asset classes and within each asset class. Determining what % of our portfolio to put in any given asset class is known as asset allocation and some people say up to 90% of portfolio returns can be determined by asset allocation.  That pretty much sums up passive management. The idea is to buy ETFs across asset classes and just leave them. You can readjust your portfolio holdings periodically, but otherwise there is no rapid trading. Now the other umbrella is active management. The unifying idea is that you can generate superior returns by stock selection. Active investors reject the idea of efficient markets.  A classic and time proven strategy is value investing. After the collapse of 07/08, bank stocks greatly fell, but all the other stocks fell with them. Some stocks worth $100 were selling for $50. Value investors quickly snapped up these stocks because they had a margin of safety. Even if the stock didn't go back to 100, it could go up to $80 or $90 eventually, and investors profit. The main ideas in value investing are: have a big margin of safety, look at a company's fundamentals (earnings, book value, etc), and see if it promises adequate return. Coke has tremendous earnings and it's a great company, but it's so large that you're never going to make 20% profits on it annually, because it just can't grow that fast. Another field of active investing is technical analysis. As opposed to the ""fundamental analysis"" of value investing, technical analysis involves looking at charts for patterns, and looking at stock history to determine future paths. Things like resistance points and trend lines also play a role. Technical analysts believe that stocks are just ticker symbols and that you can use guidelines to predict where they're headed.  Another type of active investing is day trading. This basically involves buying and selling stocks every hour or every minute or just at a rapid pace. Day traders don't hold onto investments for very long, and are always trying to predict the market in the short term and take advantage of it. Many individual investors are also day traders.  The other question is, how do you choose a strategy? The short answer is: pick whatever works for you. The long answer is: Day trading and technical analysis is a lot of luck. If there are consistent systems for trading , then people are keeping them secret, because there is no book that you can read and become a consistent trader. High frequency trading (HFT) is an area where people basically mint money, but it s more technology and less actual investing, and would not be categorized as day trading.  Benjamin Graham once said: In the short run, the market is a voting machine but in the long run it is a weighing machine. Value investing will work because there's evidence for it throughout history, but you need a certain temperament for it and most people don't have that. Furthermore, it takes a lot of time to adequately study stocks, and people with day jobs can't devote that kind of time. So there you have it. This is my opinion and by no means definitive, but I hope you have a starting point to continue your study. I included the theory in the beginning because there are too many monkeys on CNBC and the news who just don't understand fundamental economics and finance, and there's no sense in applying a theory until you can understand why it works and when it doesn't." &gt; There are plenty of people that consistently beat the market. If the market were truly efficient, then everyone should just passively invest, which would make the market inefficient, leading to active investment.  Passive investing  a.) Doesn't mark the market *less* efficient, I don't know how you came to that conclusion.  b.) There is not a big group of people who consistently beat the markets. There's a tiny, *tiny* sliver of a fraction of a portion of a group of people that beat the market over any ten year period, which is *consistent* with pure randomness. You're statistically likely to say those kinds of anomalies. In fact, it'd be stranger if we *didn't*.  c.) The markets aren't *truly* efficient. They can't. There's imperfect information. The point is the potential exploits cannot 1.) be exploited on scale, because that creates market efficiency, and cannot 2.) be public, because that also creates efficiency. As more and more exploits are found, we're eliminating all these black swans. If you compare all 400 professionally managed mutual funds, only 2 have ever beaten the market, and by less than 50 basis points. That's 0.5%. That's not even consistent with randomness, that's worse than random. It goes to show how few and far between any potential exploits exist. It's simply not worth your time as an investor, because if giant firms employing hundreds cannot find them, a handful of people won't be able to find them by anything other than chance. It's almost always better to passively invest.  You can read more about this, because while intuitively you may feel active investment can be better, the numbers don't lie and I promise you you're very wrong. "I read the book, and I'm willing to believe you'd have a good chance of beating the market with this strategy - it is a reasonable, rational, and mechanical investment discipline. I doubt it's overplayed and overused to the point that it won't ever work again. But only IF you stick to it, and doing so would be very hard (behaviorally). Which is probably why it isn't overplayed and overused already. This strategy makes you place trades in companies you often won't have heard of, with volatile prices. The best way to use the strategy would be to try to get it automated somehow and avoid looking at the individual stocks, I bet, to take your behavior out of it. There may well be some risk factors in this strategy that you don't have in an S&P 500 fund, and those could explain some of the higher returns; for example, a basket of sketchier companies could be more vulnerable to economic events. The strategy won't beat the market every year, either, so that can test your behavior. Strategies tend to work and then stop working (as the book even mentions). This is related to  whether other investors are piling in to the strategy and pushing up prices, in part.  But also, outside events can just happen to line up poorly for a given strategy; for example a bunch of the ""fundamental index"" ETFs that looked at dividend yield launched right before all the high-dividend financials cratered. Investing in high-dividend stocks probably is and was a reasonable strategy in general, but it wasn't a great strategy for a couple years there. Anytime you don't buy the whole market, you risk both positive and negative deviations from it. Here's maybe a bigger-picture point, though. I happen to think ""beating the market"" is a big old distraction for individual investors; what you really want is predictable, adequate returns, who cares if the market returns 20% as long as your returns are adequate, and who cares if you beat the market by 5% if the market cratered 40%. So I'm not a huge fan of investment books that are structured around the topic of beating the market. Whether it's index fund advocates saying ""you can't beat the market so buy the index"" or Greenblatt saying ""here's how to beat the market with this strategy,"" it's still all about beating the market. And to me, beating the market is just irrelevant. Nobody ever bought their food in retirement because they did or did not beat the market. To me, beating the market is a game for the kind of actively-managed mutual fund that has a 90%-plus R-squared correlation with the index; often called an ""index hugger,"" these funds are just trying to eke out a little bit better result than the market, and often get a little bit worse result, and overall are a lot of effort with no purpose. Just get the index fund rather than these. If you're getting active management involved, I'd rather see a big deviation from the index, and I'd like that deviation to be related to risk control: hedging, or pulling back to cash when valuations get rich, or avoiding companies without a ""moat"" and margin of safety, or whatever kind of risk control, but something. In a fund like this, you aren't trying to beat the market, you're trying to increase the chances of adequate returns - you're optimizing for predictability. I'm not sure the magic formula is the best way to do that, focused as it is on beating the market rather than on risk control. Sorry for the extra digression but I hope I answered the question a bit, too. ;-)" As you mentioned in the title, what you're asking about comes down to volatility.  DCA when purchasing stock is one way of dealing with volatility, but it's only profitable if the financial instrument can be sold higher than your sunk costs.  Issues to be concerned with: Let's suppose you're buying a stock listed on the NYSE called FOO (this is a completely fake example).  Over the last six days, the average value of this stock was exactly $1.00Note 1.  Over six trading days you put $100 per day into this stockNote 2: At market close on January 11th, you have 616 shares of FOO.  You paid $596.29 for it, so your average cost (before fees) is: $596.29 / 616 = $0.97 per share Let's look at this including your trading fees: ($596.29 + $30) / 616 = $1.01 per share. When the market opens on January 12th, the quote on FOO could be anything.  Patents, customer wins, wars, politics, lawsuits, press coverage, etc... could cause the value of FOO to fluctuate.  So, let's just roll with the assumption that past performance is consistent: Selling FOO at $0.80 nets: (616 * $0.80 - $5) - ($596.29 + $30) =  $123.49 Loss Selling FOO at $1.20 nets: (616 * $1.20 - $5) - ($596.29 + $30) =  $107.90 Profit Every day that you keep trading FOO, those numbers get bigger (assuming FOO is a constant value).  Also remember, even if FOO never changes its average value and volatility, your recoverable profits shrink with each transaction because you pay $5 in fees for every one. Speaking from experience, it is very easy to paper trade.  It is a lot harder when you're looking at the ticker all day when FOO has been $0.80 - $0.90 for the past four days (and you're $300 under water on a $1000 portfolio).  Now your mind starts playing nasty games with you. If you decide to try this, let me give you some free advice: Unless you have some research (such as support / resistance information) or data on why FOO is a good buy at this price, let's be honest: you're gambling with DCA, not trading. END NOTES: Double check with your broker, but if a series isn't open yet for trading, you can't trade it. If there is a series trading without open interest (rare), simply work your open, as options are created at trade. If you have enough money, do this https://money.stackexchange.com/questions/21839/list-of-cflex-2-0-brokers "There's actually a lot of smaller questions in your question, so I'll answer just a few here. The standard bond index for high yield corporates is the Barclays Capital High Yield Corporate index, which is the basis for JNK.  I am not familiar with the index behind HYG, the ""iBoxx $ Liquid High Yield index."" The ETFs are managed quantitatively to try to track the index as closely as possible.  AFAIK these ETFs do not attempt to take active positions. New issues are typically purchased with cash which is constantly coming in from interest and principal payments from other bonds.  There is rarely a need to sell bonds just to buy new issues.  Selling bonds is more common when a fund is experiencing redemptions. These ETFs and the high yield bonds they buy are not derivatives (your question seems to be confused on that point). The US Treasury is not directly involved in any way.  They are indirectly involved, as they are indirectly involved in US equities markets or world markets for that matter, although perhaps they have greater influence in the bond world. Moody's has extensive studies of default rates by ratings."