Dan Passarelli

Dan Passarelli

Dan Passarelli is an author, trader and former member of the Chicago Board Options Exchange (CBOE) and CME Group. Dan has written two books on options trading — "Trading Option Greeks" and "The Market Taker's Edge." He is also the founder and CEO of Market Taker Mentoring, Inc., a leading options education firm that provides online options education, options newsletters and personalized, one-on-one coaching for option traders.

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Overcoming The Earnings Dilemma

As a market maker on the CBOE, I always had a simple plan when it came to trading stocks around their earnings announcement: Don’t do it. I, like most professional traders, didn’t like trading options on stocks with earnings coming out because that was the day of the quarter that typically had the most risk. […]






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Is Volatility Over Priced?

We’ve seen this movie before. Different actors. Different setting. But it’s the same old formulaic screen play. … And we know how it ends. Every so often, a controlled problem arises that leads to opportunities in the market. Like, remember the Y2K bug panic in December of 1999?  Panicked investors where buying up options to […]






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Fed’s New Song

After months and months of the Fed propping up the U.S. stock market, the Fed has changed its tune. And, as we can see, the market doesn’t particularly like this song. One of the big lessons for traders from recent market action resulting from Fed news that I want to examine in today’s post is […]






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How the VIX Telegraphed the Market’s Top

It’s been a good run this year for the U.S. stock market. Now we’re seeing somewhat of a pullback. No surprise, really. Stocks can’t just keep going up forever. And, it’s really no surprise when one considers what’s been going on with the VIX lately. The CBOE Volatility Index, or VIX, measures buying and selling […]






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Sell (Options) in May and Go Away

Many investors have heard the phrase “Sell in May and go away”. But the question is: Sell what?  Often, traders consider this trading idiom only from an equities standpoint. That is, sell stocks in May and get back in the game after the summer. The rationale for this logic is that the summer months typically […]






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Trading With Discipline: The Battle of the Brains

It doesn’t matter how long you’ve been trading, you can slip into bad habits. One of the worst habits for any trader, experienced or not, is to trade without discipline. There are lots of various option trading strategies, philosophies and methodologies. All traders need to trade with a plan. More importantly, traders need to follow […]






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Making the Most Out of Option Theta

**Editors Note: Dan will be speaking at Traders Expo Las Vegas today thru Saturday. He is a good friend of the CBOE, track him down and introduce yourself to him.   There are two things in life of which a trader can be certain: Death and theta. Option theta can be used to the advantage […]






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Exit Strategies

We, as traders, spend a lot of time thinking about trade set-ups, and trade entry levels. But, to be sure, it’s the trade exits that matter the most. The price at which one exits a trade ultimately determines whether the trade is a winner or a loser. In fact, two traders can both put on […]






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A Problems with Many Traders: Lack of Diversification

One of the problems with many of the traders that come to me seeking coaching is lack of diversification. I’m not talking large caps vs. small caps or techs vs. emerging markets. That sort of diversification is more in the context of investing—not trading. As option traders, we must diversify our option-centric risk. We must […]






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Legging Into Iron Condors

One of my favorite strategies is a two-parter: Legging into Iron Condors. I was talking with one of my mentoring students late last year about this strategy. The student was fairly neutral on a particular stock, but felt it might have a little more room to the upside in the short term. The stock was […]






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Trading With Discipline: The Battle of the Brains

It doesn’t matter how long you’ve been trading, you can slip into bad habits. One of the worst habits for any trader, experienced or not, is to trade without discipline.   There are lots of various option trading strategies, philosophies and methodologies. All traders need to trade with a plan. More importantly, traders need to […]