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A mystery trader just dropped a cool $1 million on an interesting order, so we’ll discuss that, why the stock could be setting up for a major move and more [tap to join us for Stonkamania]
Let’s discuss something I get asked all the time…
Why don’t I trade long-dated options? It’s a fair question, and the answer isn’t what most people expect. I don’t do anything long-dated. Full stop. But before you think I’m trashing the strategy — I’m not. Long-dated options aren’t necessarily bad trades.
That’s not the point at all.
The real issue comes down to one thing: capital. Specifically, what you do with it and how fast you can put it back to work.
The Capital Refresh Philosophy
I need capital to refresh every single day. That’s the core of how I operate. If I’m holding something like an option that doesn’t expire for four or five months, I can’t have that money tied up while better opportunities are sitting right in front of me.
Every dollar that’s locked into a longer-dated position is a dollar I can’t deploy on a high-percentage short-term setup that could be over and done that same day or the next.
And it’s not just about preference. It’s about reality. We all have account sizes and you only have so much buying power. It’s not possible to do everything even if you want to. When you’re dealing with limited capital, tying it up for months on end doesn’t make sense if your edge lives in fast-turning setups that can multiply that capital each day.
The day and short-term trades are just too good to sacrifice that flexibility for something that could take months to come to fruition. Some days you see moves explode right out of the gate — like a couple of early call-outs that ripped before most people even finished their coffee.
Those are the kinds of moves I want to be ready for. But you can only take advantage of that speed if your capital isn’t trapped in slow-moving positions.
The Reality of Market Conditions
Another reason I keep my capital flexible is because the market doesn’t move in straight lines. Some days the strength is unbelievable — the kind of strength that makes you think the move’s done, only for the market to push even higher.
When the tape’s that strong, you’ve got to be able to adapt on the fly, not wait around for a long-dated contract to hopefully cooperate months down the road when who knows what could happen in the meantime.
Fast markets reward fast traders. When the momentum’s insane and you’re seeing clean setups hit one after another, having capital tied up is the last thing you want.
Flexibility becomes a weapon, not a luxury.
Would I love to run longer-term positions alongside everything else? Sure. I wish I had unlimited capital so I could stack long-term plays on top of short-term wins. But we don’t trade in fantasy land. We trade in the real world where every dollar has a job and needs to be put to work efficiently.
So if you’ve been wondering why I stick to weekly and short-dated options instead of loading up on longer-dated plays no matter how great they appear to be, now you know. It’s not ideology — it’s math and opportunity. Refresh the capital, stay in the game and keep the edge sharp.
Let’s get after it.
Order Flow:
This is for informational and educational purposes only. These are not official alerts issued by Lance, but rather some interesting orders picked by the team at Lance Ippolito Trading.
When you look at these plays, always take the market maker move into consideration.
You can be right on the direction but still lose money if the stock doesn’t move enough. That’s where the market maker move comes in clutch.
With puts, they’re often downside hedges in case a stock tanks, especially around earnings. The further out of the money they are, the more likely they are to be hedges.
Also be sure and check when the company’s earnings date is because many of the plays we post here are centered around earnings!
If a stock is really expensive, consider a spread to lower the cost.
And finally, always remember the golden rule when it comes to buying calls: Buy dips, sell rips — and don’t chase!
If a stock’s moved a ton already today, maybe wait for a pullback.
There is inherent risk in trading. Trade at your own risk.
Note: If no date is listed after the month, it’s the monthly expiration (third Friday).
The team at Lance Ippolito Trading
Lance doesn’t want the CCP spying on him, so you’ll never find him on TikTok. Same goes for other social media sites, which are filled with impersonators, scammers and crypto bros.
You can only find him on his personal YouTube Channel — smash that Subscribe button! https://www.youtube.com/@LanceIppolito
And in his private Telegram channel: https://t.me/+-gVwEIwGJhplMTgx
Important Note: No one from the team at Lance Ippolito Trading, New Money Crew or any of its associated brands will ever contact you directly on Telegram.
*This is for informational and educational purposes only. There is inherent risk in trading, so trade at your own risk.
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