The OPEX Effect

Brent Kochuba of SpotGamma joins Jack Forehand for the May 2026 OPEX Effect to break down what options positioning is saying after a massive AI and semiconductor-led market rally. They discuss SPX call volume, zero DTE options, dealer gamma, VIX expiration, NVIDIA earnings, oil risk, AI CapEx, and why options flows may help explain both the market’s recent melt-up and the potential for a volatility shift after OPEX.Guest LinksBrent Kochuba on Xhttps://x.com/spotgammaSpotGammahttps://spotgamma.com/Topics CoveredWhy the market has ignored oil shocks and geopolitical risk while AI earnings dominate investor attentionHow AI CapEx, semiconductors and mega-cap tech have driven a powerful melt-up in stocksWhy options volume and zero DTE trading are increasingly important for all investorsHow dealer hedging, delta and gamma can affect stock market movesWhy options expiration can create short-term turning points in markets and volatilityWhat the May OPEX setup says about call-heavy positioning in the S&P 500Why single-stock options activity in NVIDIA, Tesla, Apple, Amazon and AI-related names mattersHow record SPX call volume is being driven by short-dated options flowsWhy Brent is watching VIX expiration, NVIDIA earnings and May 19 to May 20 for volatility expansionWhat oil, VIX, correlation and dispersion are signaling about market riskTimestamps00:00 Intro: SPX call volume, call-heavy positioning and transient options flows00:57 Are we in melt-up mode?05:29 AI, UFOs and how fast market narratives are changing09:00 Why options flows matter more for everyday investors13:39 Could SpaceX become the next huge options market?16:00 How dealer hedging, delta and gamma move through the market20:44 Why OPEX can become a turning point for stocks and volatility23:22 Why May OPEX is so call heavy28:07 The market rally into May expiration33:00 AI rebranding, meme behavior and downside headline risk36:07 Reviewing last month’s oil and volatility setup40:17 How the war flipped market leadership back to tech44:13 Dealer gamma support in the S&P 50049:19 Single-stock gamma in NVIDIA, Tesla, Apple and Amazon51:06 Record SPX call volume and the role of zero DTE54:55 Semiconductor, AI and memory call volume57:50 From bearish positioning to peak-bull dispersion59:22 Oil, the S&P 500 and changing correlations01:03:06 COR1M, dispersion risk and when Brent considers hedging01:04:57 Brent’s key takeaways for May OPEX and volatility expansion

This episode of The Opex Effect breaks down why markets have remained surprisingly resilient despite geopolitical chaos, an oil shock, and extreme headline risk. Brent Kochuba joins Jack Forehand to analyze what’s really driving the market beneath the surface—from options flows and gamma positioning to the collapse in volatility and what it signals for the next move.They explore how the options market is shaping price action in ways most investors miss, why the VIX collapsed despite elevated risk, and what positioning tells us about the path forward as we head into earnings and the next major options expiration.Topics covered:Why markets have stayed near highs despite war, oil spikes, and macro uncertaintyThe “taco trade” and why investors expect bad news to reverse quicklyHow options flows and dealer hedging are influencing stock pricesWhy call options are historically cheap heading into earningsThe mechanics of gamma, delta hedging, and market maker positioningWhy options expiration (OpEx) can act as a turning point for marketsThe divergence between oil prices and equity volatilityWhat the collapse in the VIX reveals about investor positioningThe role of zero-DTE options in reinforcing short-term market rangesKey resistance levels forming from call selling and what they mean for upsideTimestamps:00:00 Why markets aren’t reacting to geopolitical chaos04:18 The “taco trade” and shifting market expectations07:30 How options flows influence stock market movements11:10 Why OpEx can drive market turning points13:05 Volatility compression and the gamma-volatility relationship15:30 How large options positioning shapes market behavior18:05 Why positioning has shifted toward calls20:00 Why this OpEx may be less impactful than prior ones22:00 Market positioning into earnings and key drivers ahead24:10 Using gamma maps to identify support and resistance27:00 Revisiting the JP Morgan collar trade and March lows30:00 Correlation spikes and the oil-volatility relationship33:00 Why oil has stopped driving equity volatility34:30 The breakdown between oil and VIX correlation36:00 Why volatility may reprice higher after OpEx37:05 The oil curve and expectations for a short-term shock39:40 One of the largest VIX collapses ever41:00 How options positioning drove the volatility unwind43:00 Why selling volatility has become a dominant strategy45:00 The feedback loop between rising markets and falling volatilityFor more information on SpotGamma and Brent’s work:https://spotgamma.comFollow Brent on Twitter:https://twitter.com/spotgamma

This episode breaks down the growing tension beneath the surface of today’s markets, where volatility signals, options positioning, and macro risks like war and inflation are increasingly misaligned. Brent Kochuba and Jack Forehand explain why markets appear calm despite heavy hedging, and what that disconnect could mean for a potential volatility spike and downside move ahead.Brent Kochuba on Twitterhttps://twitter.com/SpotGammaSpotGamma Websitehttps://spotgamma.comTopics covered in this episode• Why volatility looks elevated beneath the surface even as markets remain relatively calm• The growing gap between implied volatility VIX and realized volatility and what it signals• How options expiration OPEX can create turning points in both price and volatility• Why current positioning is unusually put-heavy and what that means for downside risk• The role of market makers and hedging flows in driving market moves• How geopolitical risks like the Iran conflict are changing options behavior and hedging demand• Why correlation is spiking and what it says about investors moving from stock picking to asset allocation• The breakdown of traditional diversification including the 60/40 portfolio• How credit markets and liquidity risks could amplify equity volatility• The impact of zero DTE options and why traders are shifting to longer-duration hedges• The significance of the JP Morgan collar trade and key levels to watch into month-end• Why volatility spikes often follow periods of suppressed market movement• The potential for a sharp upside rally if geopolitical risks suddenly resolve• How options positioning can help both traders and long-term investors with timing decisionsTimestamps00:00 Volatility premium vs low market movement disconnect01:00 Why markets feel calm despite rising risks05:20 Explosion in options volume and impact of Monday Wednesday Friday expirations07:00 How market maker hedging flows drive price movements08:40 Dynamic hedging and why options impact evolves over time09:20 Why OPEX can trigger market turning points10:30 VIX expiration effects and short-term volatility suppression13:00 Negative gamma and how it amplifies market volatility14:10 Why hedging demand remains high despite OPEX clearing16:00 Jump risk scenario and potential VIX spike to 4017:10 Shift from zero DTE trading to longer-term hedging18:00 Put-heavy positioning across equities and indices20:40 Size and significance of the current OPEX event22:20 VIX spike dynamics around expiration23:40 JP Morgan collar trade and key SPX levels25:00 Why OPEX often marks short-term market lows or highs28:30 Review of prior OPEX signals and market setup30:00 Rising correlation and shift to asset allocation mindset32:00 Dispersion breakdown and implications for equities34:00 Software sector volatility and AI disruption narrative36:30 Using options signals for better timing decisions39:00 Correlation spike and risk-off behavior across markets41:30 Why investors are avoiding calls and piling into puts44:30 Cross-asset correlation breakdown and bond hedge failure48:00 Credit market risks and spillover into equities49:00 Extreme VIX vs realized volatility spread50:50 Why realized volatility remains unusually low52:30 Oil, inflation, and macro feedback loops

In this episode of The Opex Effect, Jack and Brent break down the growing impact of options markets on stocks, volatility, and sector rotation. While the major indexes appear calm, massive moves beneath the surface tell a very different story. From software stocks and AI disruption to gold, silver, bonds, and the Nasdaq, they analyze how dealer hedging flows, gamma positioning, implied volatility, and options expiration cycles may be shaping market behavior more than headlines suggest. If you want to understand why markets can feel wildly volatile yet go nowhere, and how options positioning can influence short term price action, this episode provides a deep dive into the mechanics driving today’s market environment.Main Topics CoveredWhy the market feels like the wildest calm market of all timeMassive single stock volatility versus muted index performanceSoftware stock weakness, AI disruption, and the so called SaaS apocalypseThe surge in options volume and the rise of zero DTE in major stocksHow dealer hedging, delta, gamma, and volatility flows impact equitiesThe historical tendency for markets to flip direction after options expirationRealized volatility versus intraday volatility and what is being hiddenBeneath the surface rotation into value, small caps, energy, and defenseGold and silver volatility spikes and what options volume signaled at the topRising demand for puts and what skew is telling us about downside riskCorrelation spikes, VIX behavior, and the risk of a volatility expansionHow positioning can create rapid market spasms in single stocks like Nvidia and TeslaWhy this environment may represent a staging area for a larger moveTimestamps00:00 Violently going nowhere and hidden volatility01:01 The wildest calm market of all time04:00 Introduction to The Opex Effect and options driven flows05:29 The growth of options trading and zero DTE impact11:00 Dealer hedging, delta, and how options move stocks13:42 Why options expiration can trigger regime changes16:22 Intraday volatility versus close to close volatility20:18 Extreme rotation beneath the surface21:00 Measuring expiration size with the lobster claw rating25:00 Single stock positioning and March expiration risk27:35 Core one month correlation warning signals33:00 Rising put demand and what skew reveals36:45 Asset rotation in bonds, gold, bitcoin, and tech43:06 Correlation spikes and crash risk setup46:40 The quickening of volatility and single stock spasms

In this episode, Jack Forehand is joined by Brent Kochuba from SpotGamma to break down how options market flows are increasingly shaping equity market behavior. The conversation focuses on January options expiration, the explosive growth of zero DTE options, and why short term volatility dynamics matter even for long term investors. Using recent market examples, the episode explains how dealer hedging, gamma exposure, and correlation shifts can drive rallies, reversals, and sudden corrections that often seem disconnected from fundamentals.Topics covered• Why options volume has surged since 2020 and how zero DTE trading changed market structure• How dealer hedging flows influence stock prices, volatility, and intraday market moves• The Captain Condor collapse and what it reveals about selling volatility and hidden risks• Why options expiration can act as a catalyst for market turning points• The relationship between implied volatility, realized volatility, and market stability• Gamma exposure explained and how positive vs negative gamma affects price action• Correlation trades and why low index volatility can signal growing market fragility• What current options positioning says about risks and opportunities after January opexTimestamps00:00 Introduction and why options flows matter for all investors03:00 What the show is about and how options expiration drives market behavior06:00 The Captain Condor story and the dangers of selling volatility15:20 Why options volume has exploded since COVID18:45 How market makers hedge options and move underlying stocks22:00 Why options expiration forces positioning changes25:00 Volatility behavior before and after opex27:45 Gamma exposure and how it predicts short term volatility29:50 December opex review and what played out as expected36:00 Correlation trades and warning signals for corrections44:40 Single stock options, speculation, and market maker profits46:30 Quadrant view of call buying, volatility, and crowd behavior49:55 Implied vs realized volatility and why tension is building

In this episode of The Opex Effect, Jack Forehand and Brent Kochuba break down what could be the largest options expiration ever and explain why December options flows, seasonality, and volatility dynamics matter so much for markets right now. The conversation explores how AI enthusiasm, equity rotation, and record options volume are colliding into year end, and what the options market is signaling about near term risk, upside, and potential turning points. From zero DTE trading and volatility suppression to the Santa Claus rally, JP Morgan’s collar trade, and the implications for stocks, small caps, and value, this episode offers a detailed look at how derivatives are shaping market behavior beneath the surface.Topics covered:Why December options expiration may be the biggest ever and why that mattersHow options market flows influence stock prices and volatilityThe role of zero DTE options in suppressing or amplifying market movesAI, capital cycles, and whether infrastructure builders will benefitSeasonality, the Santa Claus rally, and year end market dynamicsEquity rotation versus true risk off environmentsSmall caps, value stocks, and shifts away from mega cap techVolatility compression, hedging flows, and what happens after expirationThe JP Morgan collar trade and its impact on S&P 500 levelsKey upside and downside levels to watch into year end and JanuaryTimestamps:00:00 Introduction and why this could be the biggest options expiration ever02:15 AI enthusiasm, bubbles, and capital cycle risks05:00 Why price and time both matter in trading decisions06:45 Record options volume and the rise of zero DTE trading09:00 How options hedging flows move the underlying market11:20 Why December expiration can be a market turning point13:00 Volatility trends around options expiration14:30 Seasonality, holidays, and the Santa Claus rally17:00 Call heavy versus put heavy expirations19:30 Why extreme positioning can lead to reversals21:30 Size of December expiration compared to other months24:00 Lessons from November options expiration27:00 Nvidia, AI leaders, and options driven price behavior31:30 Equity rotation into small caps and value stocks34:00 Correlation, risk off signals, and market stability36:00 Key S&P 500 levels including 6800 and 700039:00 Fed uncertainty, rate cuts, and volatility outlook41:00 JP Morgan collar trade mechanics and market pinning44:00 Cheap upside calls and volatility suppression48:30 Options based ETFs and income strategies50:00 Oracle earnings, credit risk, and surprising options signals

In this month’s OPEX Effect, Brent Kochuba and Jack Forehand break down the forces driving markets into November expiration. They cover the surge in volatility, Nvidia’s critical earnings event, the clustering of major catalysts, the behind-the-scenes hedging flows that shape price action, and why this expiration looks fundamentally different from the recent call-heavy cycles. The conversation blends macro uncertainty, options positioning, single-stock fragility, and the psychology of navigating markets that feel worse than they look.Topics Covered:• Why mega-cap AI names now dominate market behavior• Why volatility feels “back,” even with markets near all-time highs• The role of retail and institutional options activity in driving hedging flows• How delta, gamma, implied volatility, and time interact in maintaining hedges• Why November’s cluster of Nvidia earnings, VIX expiration, and OPEX is so important• How volatility can mean revert after options positions roll off• The October 10 volatility spasm and what it revealed• Resetting from call-heavy markets to put-skewed positioning• Macro uncertainty, rate-cut probabilities, and political risk• Credit default swap spikes and the broader AI narrative• The difficulty of timing bubbles and speculative extremes• Value investing pain points during high-volatility periods• Why fundamental sellers may finally be stepping in• What the options market implies heading into December’s massive expirationTimestamps:00:00 Mega-cap AI exposure and volatility setup01:00 Why markets feel worse than they look01:16 How hedging flows amplify market moves16:14 Nvidia’s earnings, VIX expiration, and the volatility cluster18:14 Why options volumes keep growing20:58 How small orders snowball into large market-maker hedges22:49 How OPEX resets positioning each month25:00 Negative gamma, volatility spikes, and event catalysts25:45 October’s volatility spasms explained27:34 Why November is the most put-skewed expiration in months32:00 Correlation breakdown and signs of fundamental selling33:44 Macro uncertainties, shutdown risk, rate cuts, and CDS spikes39:15 Market uncertainty, CPI gaps, and political anxiety41:00 AI cracks, CoreWeave trouble, and credit risk05:46 Bubble parallels and speculative excess07:00 The pain of value investing in runaway markets01:07:53 Wrap-up and closing comments

In this episode, Brent Kochuba of SpotGamma joins Jack Forehand to break down the October options expiration and the surge in volatility that hit markets. They discuss record-breaking options volumes, the impact of zero-DTE trading, Trump’s market-moving tweet, and why the options market is increasingly driving short-term price action. Brent explains how positioning, gamma dynamics, and liquidity flows combine to create instability — and what that might mean for volatility into year-end.Topics covered:• Record 110 million options contracts traded and what it means for market structure• Why volatility spiked even though the S&P 500 barely fell• The role of dealer positioning and negative gamma in amplifying market swings• How the AI trade and single-stock call buying distorted implied volatility• The growing dominance of zero-DTE options and their destabilizing effects• What OPEX and VIX expirations tell us about volatility mean reversion• ETF leverage, financialization, and systemic risk• The relationship between correlation, dispersion trades, and crowding in AI names• Why volatility events now resemble “spasms” instead of slow corrections• How these options dynamics could influence the year-end “Santa Claus rally”Timestamps:00:00 Record options volume and volatility spike04:00 The AI call-buying frenzy and how it unwound10:00 Understanding dealer gamma and hedging flows12:00 OPEX, VIX expiration, and mean reversion in vol16:00 Event calendar and upcoming catalysts18:00 October OPEX setup and neutral call/put balance21:00 Seasonal trends and the “Santa Claus rally”27:00 Revisiting September’s predictions and what played out33:00 Market concentration and AI narrative40:00 Dispersion trades, correlation, and crowding44:00 Zero-DTE dynamics and their systemic impact50:00 Volatility spikes, leverage, and what comes next

In this month’s OPEX Effect, Brent and Jack break down the September OPEX, which may be the largest ever. With volatility deeply suppressed, a record call skew, and the Fed meeting coinciding with VIX expiration, markets are set up for potential fireworks. The conversation explores how derivatives flows shape equities, why this expiration could be a turning point, and what investors should watch around key levels like 6,500.Topics CoveredRecord zero DTE volumes and their market impactWhy September OPEX may be the largest expiration everThe “vol pop zombie hunter” theme and what it signalsHow option dealer hedging drives equity flowsThe correlation between gamma positioning and volatilityMacro dynamics: rate cuts, liquidity, and potential bubble parallelsWhy call skew is extreme but call prices remain lowHow suppressed implied vol sets up risk of a volatility spikeThe VIX futures curve, ETF flows, and market dislocationsKey levels to watch: 6,500 and beyond for downside riskTimestamps00:00 – Zero DTE dominance and setup into September OPEX02:00 – “Vol Pop Zombie Hunter” theme explained06:00 – How options flows translate into equity moves11:00 – Options expiration cycles and turning points16:00 – Largest expirations and potential market reversals20:00 – Extreme call skew and positioning risks28:00 – Sector positioning and the lack of call demand33:00 – Correlation lows and implications for market breadth37:00 – Realized and implied volatility at historic lows43:00 – VIX futures curve, ETFs, and contango dynamics50:00 – Risks below 6,500 and the role of JP Morgan’s collar53:00 – The destabilizing effect of disappearing zero DTE flows

In this episode of The OPEX Effect, Jack and Brent dive deep into the current market dynamics, exploring what they call the "Honey Badger" and "Zombie" market phenomena. With options volumes hitting record highs and realized volatility at basement levels, they analyze whether we're heading into a 2017-style low-volatility grind or if a volatility spike is imminent. The discussion covers everything from the latest options positioning data to the impact of zero-DTE trading on market behavior, providing valuable insights for both short-term traders and long-term investors.Market Rally Analysis - Comparing the current 4-month rally (25%) to post-COVID gains and why it feels more orderly than expectedThe "Honey Badger" Market - How the market has been buying every dip regardless of negative headlines like tariffs and policy uncertaintyOptions Volume Records - Breaking down the explosive growth in options trading and its impact on underlying stock flowsRealized Volatility at Extremes - Why hitting 6% realized vol signals potential for major volatility expansion aheadThe "Zombie" Market Theory - Drawing parallels to 2017's low-volatility environment and what it means for positioningOptions Positioning Data - Current expiration analysis showing surprisingly average positioning despite market highsTech Calls Opportunity - Why tech sector calls are at their cheapest relative levels in nearly a yearMarket Maker Hedging Flows - How dealer gamma positioning creates "strait jacket" effects on market movementJackson Hole & Rate Cut Expectations - Upcoming catalysts and why the market is pricing in 91% chance of rate cutsNew Tool Launch - Introduction of Flow Patrol, a daily PDF report tracking proprietary buy-side positioning data00:00 - Introduction and market rally discussion01:18 - Honey Badger market concept explanation05:05 - Options volume impact on equity markets10:05 - Hedging flows and market dynamics12:00 - Historical options expiration patterns16:00 - Positive gamma and "Chinese finger trap" markets18:00 - Current expiration positioning analysis24:00 - July predictions review and honey badger emergence33:00 - The zombie market theory and realized volatility extremes43:00 - Friday market action and volatility pricing analysis47:00 - The "spasm" effect and correlation dynamics52:00 - Forward-looking events and zombie market continuation57:00 - Investment recommendations: puts and tech calls59:00 - Bubble detection through options pricing1:04:00 - Flow Patrol tool announcement and wrap-up

Markets are sitting at all-time highs, but under the surface, the options market is flashing signs of extreme positioning. In this episode, Brent Kochuba of SpotGamma returns to break down the latest options expiration cycle and what it could mean for stocks going forward.We discuss why record call buying, minimal hedging, and low implied volatility are creating a potentially fragile setup — and why upcoming events like CPI, VIX expiration, and tariffs could act as catalysts. Whether you're a long-term investor or a short-term trader, this conversation offers a deeper look at how positioning, dealer flows, and volatility pricing impact market behavior.Topics covered include:Why extreme call skew signals crowdingThe importance of gamma, vanna, and charmHow options flows can drive short-term market movesThe "window of weakness" around OPEX and VIX expirationThe role of tariffs, CPI, and macro catalysts in this setupTactical implications for investors and traders

In the latest episode of the OPEX Effect, Jack Forehand and Brent Kochuba dive deep into the dynamics shaping the current market regime, with a particular focus on the upcoming June OPEX, dealer positioning, volatility trends, and the surprising resilience of the S&P 500 amid geopolitical stress. They break down how options flows continue to dominate equity price action, why the market remains pinned despite negative news, and what might finally break the calm. With some of the largest options expirations in history on deck, this is a must-watch for anyone following volatility, hedging flows, and macro signals.💡 Topics Covered:Why volatility often contracts before OPEX and expands afterThe significance of the June 2025 OPEX as potentially the largest everDealer gamma, hedging flows, and what they signal about near-term volatilityWhy implied vol is so low despite major geopolitical risk (e.g. Israel-Iran conflict)The JP Morgan collar trade and its influence on the 5,900 level in the S&PHow zero-DTE options impact market stability and risk signalingA potential regime shift: AI stocks, “taco trades,” and declining liquidityWhat vol metrics like VIX, VVIX, and correlation are really sayingThe hidden risk of overconfidence when markets ignore bad newsBreakdown of sector-specific volatility expectations (tech, energy, gold, Bitcoin)

In this episode of Excess Returns, Jack Forehand and Brent Kochuba from SpotGamma break down the forces at play beneath the surface of the market as we head into the May 2025 options expiration (OPEX). While the S&P 500 has rallied hard, a deeper look at positioning, liquidity, volatility, and sentiment reveals a market on a potentially fragile footing. From the continued explosion of zero DTE options to concerning signs from liquidity metrics, this discussion explores how short-term positioning could dictate major moves—and why the post-OPEX landscape may not be as stable as it appears. Plus, yes… we finally explain the "Saul Goodman" reference.🔑 Topics Covered:Why May’s OPEX setup is lopsided with call exposure—and why that’s dangerousThe eerie lack of downside hedging despite a big market rallyHow zero DTE options and mean reversion flows are masking real volatilityThe dangerous illusion of low realized vol vs. wide intraday rangesWhy poor liquidity is a potential precursor for the next volatility eventAnalysis of SPX vs. SPY positioning—and which one signals more riskThe “Saul Goodman” signal: What it means and why it might be a contrarian tellWhat the data says about a potential flip post-OPEXJune expiration on deck: Could it be the next volatility catalyst?

In this episode of The OPEX Effect, Jack and Brent dive deep into the market turmoil following "Liberation Day" and the implementation of new tariffs. With volatility spiking to levels not seen since the 2020 COVID crash, the hosts analyze how options markets are reacting, why liquidity has evaporated, and what investors should expect in this new higher-volatility regime. The conversation covers everything from VIX behavior to options positioning, and provides critical insights for navigating these turbulent markets.Key Topics Covered:The recent market volatility spike and why this represents a fundamental "regime change"How options market makers are reacting to the tariff announcements and subsequent 90-day pauseWhy liquidity has disappeared from markets and its impact on price movementsThe significance of this month's options expiration and VIX expirationWhy zero-DTE options are NOT the cause of recent volatilityTechnical support and resistance levels based on options positioningGold's recent surge and signs it may be ready for consolidationThe impact of increased correlation across asset classesExpectations for upcoming earnings season and its importance in this environment

In the latest episode of the OPEX Effect, Jack Forehand and Brent Kochuba take a look behind the scenes of the big market selloff and the options flows driving it. They break down the massive options expiration coming up (the second-largest ever) and its potential impact on market movements.Key topics covered:Understanding the current high-volatility environment and why options volumes are driving increased market swingsAnalysis of the JPMorgan collar trade at the crucial 5565 level and its market implicationsDeep dive into the mysterious "Captain Condor" trader and their impact on market dynamicsDiscussion of multiple major events ahead: VIX expiration, FOMC meeting, quarterly OPEX, and potential tariff deadlineExamination of fixed-strike volatility and why traditional VIX readings might be misleading in the current environment

In this episode, Jack Forehand and Brent Kochuba analyze the current state of the options market heading into the February 2024 options expiration. They explore several critical themes, including:Why volatility remains surprisingly low despite significant market-moving eventsThe unusual dynamic where large single-stock moves (like NVIDIA's historic drop) aren't translating into broader market volatilityThe concerning signs in correlation metrics that echo patterns from past market stress periodsThe critical role of NVIDIA's upcoming earnings as a potential catalystWhy the current environment shows signs of stretched positioning that could lead to future volatilityThe shifting dynamics in Tesla options and the broader implications for market sentimentBrent shares his unique insights on why we're seeing an environment where traders are responding to market drops by selling calls rather than buying puts, and what this means for market stability. He also breaks down why the upcoming NVIDIA earnings report on February 26th could be a pivotal event for market direction.Whether you're an options trader or just interested in understanding market dynamics, this discussion provides valuable insights into the forces currently shaping market behavior.

Join Brent Kochuba and Jack Forehand as they analyze the current market landscape and what options flows tell us about potential volatility ahead. The duo dives deep into why the market may be underpricing volatility risk despite a recent 5% drawdown, significant upcoming events, and shifting rate dynamics.Key topics covered:Why the current options market positioning suggests heightened volatility riskAnalysis of January options expiration and its potential market impactDeep dive into Tesla vs NVIDIA options positioning and what it means for both stocksThe evolution of zero DTE options trading and its real market impactHow dealer gamma positioning could amplify market movesBreaking down the correlation between different asset classes in the current environmentWhether you're an options trader, long-term investor, or market enthusiast, this episode provides valuable insights into the mechanics driving today's markets and what might lie ahead. Don't miss this detailed discussion of market structure, options flows, and potential catalysts that could drive significant moves in early 2025.

Join Brent Kochuba and Jack Forehand as they break down December's historic options expiration - the largest OpEx on record. In this deep-dive episode, they explore:Why this December OpEx is uniquely significant with over $1.9 trillion in options value expiringTesla's remarkable 75% surge since November and what the options market signals about its sustainabilityThe fascinating case of MicroStrategy, Bitcoin enthusiasm, and concerning signs of market euphoriaHow major market positioning could impact year-end tradingWhy extremely low volatility and deteriorating market breadth may be warning signsThe stark divide between mega-cap tech performance and the broader market00:00 - Welcome to The OpEx Effect - Biggest Options Expiration Ever00:35 - Why This OpEx Is Different: Record Volumes & Significance02:06 - Understanding Options Market Growth & Impact05:07 - Breaking Down the $1.9 Trillion in Options Value08:42 - Call vs Put Dominance (10:1 Ratio)15:07 - Record Low Volatility & Market Implications19:15 - Tesla's 75% Surge Since November23:30 - MicroStrategy, Bitcoin & Market Sentiment28:45 - Market Breadth Issues & Mega-Cap Divergence35:14 - The "Balloon Pop" Theory of Volatility42:17 - JP Morgan Collar & Market Pinning Effects47:16 - Cost of Portfolio Hedging at Historic Lows50:47 - Warning Signs: Margin Debt & Retail Speculation54:27 - The Problem with MicroStrategy's Premium58:31 - Market Divergence: "Crocodile Jaws"1:01:47 - Final Thoughts & Looking Ahead to January1:04:49 - Closing Remarks & DisclaimerDOWNLOAD THE SLIDE DECKhttps://spotgamma.com/opexMORE INFORMATION ABOUT SPOTGAMMA⁠https://www.spotgamma.com⁠⁠⁠⁠⁠⁠FOLLOW BRENT ON TWITTER⁠⁠⁠https://twitter.com/spotgamma⁠⁠⁠⁠⁠FOLLOW JACK ON TWITTER⁠⁠https://twitter.com/practicalquant⁠

In this episode of The OpEx Effect, we dive deep into the fascinating market dynamics following the recent election and explore the remarkable surge in options trading volume. We break down how Tesla's impressive rally is being driven by options flows and explain the mechanics behind gamma squeezes.We explore several key themes, including:How the post-election volatility crush led to a significant market rallyWhy Tesla has become the premier "Trump trade" and what the options flows tell us about its momentumThe current state of meme stocks and the return of familiar faces like Cathie WoodWhy the upcoming NVIDIA earnings could be a major catalyst for the broader marketWhat dealer positioning and options skew tell us about potential year-end movesThroughout our discussion, we emphasize our core thesis that "flows over fundamentals" is increasingly driving market action, especially as options trading volume continues to hit new records. We also touch on our outlook for the crucial December OpEx period and share our thoughts on why the current rally may have more room to run despite stretched valuations in certain names.Join us for an in-depth conversation that combines technical analysis, market structure insights, and practical implications for long-term investors.DOWNLOAD THE SLIDE DECKhttps://spotgamma.com/opexMORE INFORMATION ABOUT SPOTGAMMA⁠https://www.spotgamma.com⁠

In this episode of the OPEX Effect, we take a look behind the scenes at options flows at what is going on in the options market as we head into the election. We cover:- The current options landscape leading into October expiration- How NVIDIA's performance continues to drive broader market trends- Analysis of volatility patterns and their implications for market movement- Detailed exploration of potential market reactions to the upcoming U.S. election- The mechanics behind post-election volatility crush and its effect on stock prices- Comparisons to previous election cycles and lessons learned- Discussion of the JP Morgan collar trade and its market influence- Insights on interpreting options flow data to anticipate market movesWhether you're an options trader, long-term investor, or simply interested in understanding market forces, this episode provides valuable perspectives on how options expiration and major events like elections can shape market behavior. Brent and Jack break down complex concepts into digestible insights, offering both technical analysis and practical takeaways for navigating the current market environment.SPOTGAMMA'S NEW PRODUCT - TRACE THE MARKEThttps://spotgamma.com/trace-the-market-excess-returns/?aff=ExcessDOWNLOAD THE SLIDE DECKhttps://spotgamma.com/opexMORE INFORMATION ABOUT SPOTGAMMA⁠https://www.spotgamma.com⁠⁠⁠⁠⁠⁠FOLLOW BRENT ON TWITTER⁠⁠⁠https://twitter.com/spotgamma⁠⁠⁠⁠⁠FOLLOW JACK ON TWITTER⁠⁠https://twitter.com/practicalquant⁠

In this episode, we dive deep into the world of options and their impact on market dynamics. We start with an "Options Dealer Flows 101" primer, explaining key concepts like delta hedging, gamma, charm, and vanna to help viewers understand how options flows can drive stock prices. We then analyze the current market situation heading into the September 2024 options expiration, one of the biggest of the year. We explore the outsized influence of Nvidia options activity, discuss potential outcomes from the upcoming FOMC meeting, and examine how bond-equity correlations are shifting. We break down why understanding options flows is crucial even for long-term investors who don't trade options themselves. Using real-world examples, we illustrate how options positioning can create market volatility and reversals around key dates. Whether you're an options trader or just want to better understand what's moving markets, this episode provides valuable insights into the hidden forces shaping stock prices. Join us as we unpack the complex world of options and their far-reaching effects on the broader market. SPOTGAMMA'S NEW PRODUCT - TRACE THE MARKET https://spotgamma.com/trace-the-market-excess-returns/?aff=Excess DOWNLOAD THE SLIDE DECK https://spotgamma.com/opex MORE INFORMATION ABOUT SPOTGAMMA ⁠https://www.spotgamma.com⁠ ⁠⁠⁠⁠⁠FOLLOW BRENT ON TWITTER ⁠⁠⁠https://twitter.com/spotgamma⁠ ⁠⁠⁠⁠FOLLOW JACK ON TWITTER ⁠⁠https://twitter.com/practicalquant⁠

In this episode of OPEX Effect, we dive into the recent market volatility and its connection to options flows. We discuss the sudden VIX spike to 65, examining the factors that led to this extreme event, including low liquidity, the unwinding of correlation trades, and the impact of zero-day options. We explore how the market landscape has shifted, with a focus on the transition from inter-equity correlation to a broader bonds versus equities perspective. We also analyze the current options positioning and its implications for future market movements, particularly in light of upcoming economic data releases and events like Jackson Hole. Throughout the episode, we emphasize the importance of understanding options flows and market dynamics to make more informed investment decisions in these volatile times. DOWNLOAD THE SLIDE DECK ⁠⁠⁠⁠⁠https://spotgamma.com/opex MORE INFORMATION ABOUT SPOTGAMMA ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://www.spotgamma.com⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠FOLLOW BRENT ON TWITTER ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://twitter.com/spotgamma⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠FOLLOW JACK ON TWITTER ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://twitter.com/practicalquant⁠⁠⁠

In this episode of the OPEX Effect, we explore the current market rally and discuss the concept of "correlation spasms" - unusual movements and relationships between market components. We examine record low volatility, the outsize impact of mega-cap tech stocks, and the recent surge in small-caps. We analyze the prevalence of zero days-to-expiry options trading and its effects on intraday volatility. We consider potential scenarios for how current market imbalances may unwind and highlight key indicators to watch around the upcoming options expiration. Our goal is to provide insight into the complex forces driving markets, helping long-term investors better understand and contextualize daily market moves, even if they don't actively trade based on these shorter-term dynamics. DOWNLOAD THE SLIDE DECK ⁠⁠⁠⁠https://excessreturnspod.com/opexeffectjuly2024⁠⁠ MORE INFORMATION ABOUT SPOTGAMMA ⁠⁠⁠⁠⁠⁠⁠⁠⁠https://www.spotgamma.com⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠FOLLOW BRENT ON TWITTER ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://twitter.com/spotgamma⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠FOLLOW JACK ON TWITTER ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://twitter.com/practicalquant⁠⁠

In this month's episode of the OPEX Effect, we take a deep dive into the world of options flows and their impact on the markets. We discuss the recent GameStop saga and the role options played in the stock's wild ride. We also explore the concept of volatility suppression, the dispersion between mega-cap tech stocks like NVIDIA and the rest of the market, and the record-breaking streak of low volatility in the S&P 500. Finally, we analyze the extreme bloat in NVIDIA's options complex and what it means for investors. DOWNLOAD THE SLIDE DECK ⁠⁠⁠https://excessreturnspod.com/opexeffectjune2024⁠ MORE INFORMATION ABOUT SPOTGAMMA ⁠⁠⁠⁠⁠⁠⁠⁠https://www.spotgamma.com⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠FOLLOW BRENT ON TWITTER ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://twitter.com/spotgamma⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠FOLLOW JACK ON TWITTER ⁠⁠⁠⁠⁠⁠⁠⁠⁠https://twitter.com/practicalquant⁠⁠

In this episode of the OpEx Effect, we discuss the current state of the market as we approach the May options expiration. We analyze the low levels of volatility and put demand, suggesting market participants are not too concerned about potential downside risks. We also examine the impact of key upcoming events, particularly the CPI report and NVIDIA earnings, and how they could influence market direction. Additionally, we explore the relationship between options activity and market sentiment and the importance of understanding these dynamics even for long-term investors. DOWNLOAD THE SLIDE DECK ⁠⁠⁠https://excessreturnspod.com/opexeffectmay2024.pd⁠f⁠⁠ MORE INFORMATION ABOUT SPOTGAMMA ⁠⁠⁠⁠⁠⁠⁠https://www.spotgamma.com⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠FOLLOW BRENT ON TWITTER ⁠⁠⁠⁠⁠⁠⁠⁠⁠https://twitter.com/spotgamma⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠FOLLOW JACK ON TWITTER ⁠⁠⁠⁠⁠⁠⁠⁠https://twitter.com/practicalquant⁠⁠

In this episode of the OPEX Effect podcast, Brent Kochuba and Jack Forehand discuss the current market turmoil and its potential impact on options flows. They analyze how the geopolitical conflict in the Middle East, coupled with rate volatility and the upcoming U.S. elections, is causing a shift in the market environment from a period of volatility suppression to one of increased volatility. The hosts examine various indicators, such as correlation, dispersion, and the VIX, to highlight the unwinding of previous market flows and the potential for a new volatility regime. They also discuss the implications of the VIX expiration occurring before the equity options expiration and how this could impact the market in the coming week. DOWNLOAD THE SLIDE DECK ⁠⁠https://excessreturnspod.com/opexeffectapril2024.pd⁠f⁠ MORE INFORMATION ABOUT SPOTGAMMA ⁠⁠⁠⁠⁠⁠https://www.spotgamma.com⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠FOLLOW BRENT ON TWITTER ⁠⁠⁠⁠⁠⁠⁠⁠https://twitter.com/spotgamma⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠FOLLOW JACK ON TWITTER ⁠⁠⁠⁠⁠⁠⁠https://twitter.com/practicalquant⁠

The OPEX Effect looks at the impact of options flows on the market from the perspective of longer-term investors. In each episode, we break down what is going on behind the scenes in the options market and how the resulting flows are moving markets. In this episode, we take a deep dive into the March 2024 options expiration and its potential implications for the market. We discuss dealer positioning into the expiration, whether the call buying in the chip sector is showing signs of exhaustion, the relationship between gold and Bitcoin and forward stock returns, options positioning headed into Nvidia's upcoming major announcement and a lot more. DOWNLOAD THE SLIDE DECK ⁠https://excessreturnspod.com/opexeffectmarch2024.pdf⁠ MORE INFORMATION ABOUT SPOTGAMMA ⁠⁠⁠⁠⁠https://www.spotgamma.com⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠FOLLOW BRENT ON TWITTER ⁠⁠⁠⁠⁠⁠⁠https://twitter.com/spotgamma⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠FOLLOW JACK ON TWITTER ⁠⁠⁠⁠⁠⁠https://twitter.com/practicalquant⁠

The OPEX Effect looks at the impact of options flows on the market from the perspective of longer-term investors. In each episode, we break down what is going on behind the scenes in the options market and how the resulting flows are moving markets. In this episode, we take a deep dive into the February 2024 options expiration and its potential implications for the market. We discuss the extreme level of call buying occurring in the tech space and what it might mean going forward. We also cover volatility, skew, the price of downside protection, tech domination of the S&P 500 and a lot more. DOWNLOAD THE SLIDE DECK https://www.validea.com/documents/opexeffectfebruary2024.pdf MORE INFORMATION ABOUT SPOTGAMMA ⁠⁠⁠⁠https://www.spotgamma.com⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠FOLLOW BRENT ON TWITTER ⁠⁠⁠⁠⁠⁠https://twitter.com/spotgamma⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠FOLLOW JACK ON TWITTER ⁠⁠⁠⁠⁠https://twitter.com/practicalquant⁠

The OPEX Effect looks at the impact of options flows on the market from the perspective of longer-term investors. In each episode, we break down what is going on behind the scenes in the options market and how the resulting flows are moving markets. In this episode, we take a deep dive into the January 2024 options expiration and its potential implications for the market. We discuss why this expiration could be a significent market event, what the behind the scenes details of the expiration look like and why the story is even more interesting in single stocks than it is for the S&P 500. We also get an update on the MAG 7 stocks, look at why volatility has been muted and dicsuss the implications of the rise of 0DTE options. DOWNLOAD THE SLIDE DECK https://www.validea.com/documents/opexeffectjanuary2024.pdf MORE INFORMATION ABOUT SPOTGAMMA ⁠⁠⁠https://www.spotgamma.com⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠FOLLOW BRENT ON TWITTER ⁠⁠⁠⁠⁠https://twitter.com/spotgamma⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠FOLLOW JACK ON TWITTER ⁠⁠⁠⁠https://twitter.com/practicalquant⁠

THE OPEX Effect looks at the impact of options flows on the market from the perspective of longer-term investors. In each episode, we break down what is going on behind the scenes in the options market and how the resulting flows are moving markets. In this episode, we look at where things stand coming into the December 2023 options expiration. We look at dealer positioning in the S&P 500 headed into the expiration and what that might mean going forward. We discuss the setup in small-cap stocks, whether we are seeing excessive call buying in single stocks, the JP Morgan Collar trade and a lot more. DOWNLOAD THE SLIDE DECK https://www.validea.com/documents/opexeffectdecember2023.pdf MORE INFORMATION ABOUT SPOTGAMMA ⁠⁠https://www.spotgamma.com⁠⁠ ⁠⁠⁠⁠⁠⁠⁠FOLLOW BRENT ON TWITTER ⁠⁠⁠⁠https://twitter.com/spotgamma⁠⁠ ⁠⁠⁠⁠⁠⁠FOLLOW JACK ON TWITTER ⁠⁠⁠https://twitter.com/practicalquant⁠

In our latest episode of the OPEX Effect, we discuss the upcoming November options expiration and what Brent is seeing in options markets leading into it. We also talk about the impact of 0DTE options on the market, the relationship between options expirations and VIX expirations, positioning in the Mag 7 stocks and a lot more. DOWNLOAD THE SLIDE DECK https://www.validea.com/documents/opexeffectnovember2023.pdf MORE INFORMATION ABOUT SPOTGAMMA ⁠https://www.spotgamma.com⁠ ⁠⁠⁠⁠⁠FOLLOW BRENT ON TWITTER ⁠⁠⁠https://twitter.com/spotgamma⁠ ⁠⁠⁠⁠FOLLOW JACK ON TWITTER ⁠⁠https://twitter.com/practicalquant⁠ FOLLOW JUSTIN ON TWITTER ⁠https://twitter.com/jjcarbonneau⁠

In our inaugural episode of the OPEX effect, Brent Kochuba, Jack Forehand and Justn Carbonneau look at the options market as we approach the October expiration and the big takeaways investors can take from it. We discuss the role options flows play in the market, look at current positioning in the S&P 500 market and also cover bonds, the MAG 7, the Ozempic trade and a lot more. DOWNLOAD THE SLIDE DECK https://www.validea.com/documents/opexeffectoctober2023.pdf MORE INFORMATION ABOUT SPOTGAMMA https://www.spotgamma.com ⁠⁠⁠FOLLOW BRENT ON TWITTER ⁠⁠https://twitter.com/spotgamma ⁠⁠FOLLOW JACK ON TWITTER ⁠https://twitter.com/practicalquant FOLLOW JUSTIN ON TWITTER https://twitter.com/jjcarbonneau⁠