Option Block 479: Maximum Gamma

Trading Block: VIX - The Chicago Board Options Exchange Volatility Index fell 4.6 percent Thursday to 17.21, after back-to-back gains for the first time since Sept. 28. VIX is down 30 percent this month, on track for the most since July. Earnings: The third-quarter earnings crunch begins this week. Mattel (MAT) - $22.26, Oct 22 straddle - Approx. $2 / 9% move. Netflix (NFLX) added fewer subscribers in the U.S. in the September quarter than it had anticipated. Amazon (AMZN) is up 1.6% at $553.29, as traders celebrate lackluster subscriber statistics for programming rival Netflix, Inc. Odd Block: Calls trade in Micron Technology Inc. (MU), calls trade in Solarwinds Inc. (SWI), and puts trade in Market Vectors Russia ETF (RSX). Listener Mail: Listener questions and comments Question from Angelo M - I have been listening to the Options Playbook Radio episodes on iron butterflies and skip strike butterflies. I wondered what you guys on the All-Star Panel thought about maybe combining those concepts with a ratio iron butterfly that sells an extra put on the downside leg. My thought process is to do this in stocks where I expect a big move but I also do not mind buying the underlying at the level of the lower leg? It would also help reduce the outlay of the trade and make it easier to break even. Thoughts? Great show and great discussions. Question from Futures MD - Does theta increase or change intraday - perhaps around lunch? Around the Block: Earnings on Friday, October 16 include GE, Honeywell International and WW Grainger.