Sometimes I feel like the market's spinning out of control.
It couldn't be a better day to talk about chaos cash flow.
Here's what happened today: One tweet sent the S&P down 1%. Just like that. And while everyone else is getting nervous about what's coming next, I'm getting excited.
Because when everyone else panics, the prepared trader gets paid.
The Strategy That Loves Chaos
Look, I've been trading since the floor days in Chicago. Started as a clerk getting crapped on by real traders, ended up as an executive at ThinkOrSwim before TD Ameritrade bought us in 2009.
The strategy I'm about to show you? I've been using it since the late '90s. But it's only been retail-friendly for three years because of margin requirements.
I call them Christmas trees.
Because every day is like Christmas.
What I Just Did Live
I went live in the market today and built the trade from scratch while the S&P was tanking. Got my fill at $17 credit - that's $1,700 on one unit.
Here's what makes this crazy: The trade profits if we go up, profits if we stay flat, and profits huge if we go down. You'd have to see a 24% decline before you'd even start to feel risk.
In April, when the market sold off almost 20%, my Christmas tree made $1,445. Held it right through hell in a hand basket.
The Edge Nobody Talks About
Here's what you need to understand: You're at a 20 VIX with the market basically at all-time highs. That's crazy.
Most people think in terms of "is it going up or down?" Stop with that crap. Clear your mind. This strategy has nothing to do with direction.
It's about skew. When I put up a nine-month chart, it looks like a bunch of dots - a Rorschach test. But right now, skew is at levels we haven't seen in years.
What does that mean? The puts are trading for almost double the calls at the same distance. People are paying massive premiums for downside protection.
Why buy insurance when you can sell it?
The Math That Changed Everything
You're getting paid at a rate of 30-40% volatility while the market's only at 20%. That's like being the house in Vegas.
I've done hundreds of these trades. The success rate? 98%. When you need a 25% crash to lose money, the math works in your favor.
The average Christmas tree gets held about 30 days. Put it on, take it off. It's not exciting, but would you rather make money or have excitement?
Why Right Now
Every trade you make for the next couple of years is gonna be baked in with tweet risk. This strategy mitigates that risk and turns the tweet into a reliable profit.
The volatility for those options way out of the money is huge - some of the juiciest we've seen in a very long time. You're getting paid at almost 40% when at-the-money options are trading at 16-17%.
Bring the pain. The more chaos, the better this gets.
Watch The Full Strategy Replay
I just showed this entire strategy live. Real fills, real money, real market chaos. The replay shows you how to read the skew indicator, exactly which strikes to use, how to build the trade on ThinkOrSwim and Tasty, and the risk graph that'll let you sleep at night.
You can do this in any account with $8,000. You don't need special technology. You just need to understand when the market is handing you free money.
Stop flying blind. Get an edge. Turn chaos into cash.
To your success,
Don Kaufman