Risky but rewarding, Weekly Options trading has become more and more popular since it debut in 2005.
What stocks trade weekly options?
Weekly options, first introduced by CBOE in October 2005, are basically short-term options as it has a life of only one week before expiration while traditional options might last for months or even years. A new list for most active weekly options is published each Thursday and expires the following Friday.
Pros and Cons of Weekly Options Trading
Pros
- You will get paid 52 times per year, not 12.
- It is similar to traditional options so you can make the most of your existing knowledge and techniques.
- Unlike monthlies, you can make a very short-term bet on a particular news item or anticipated sudden price movement.
Cons
- It is almost impossible to repair a trade that has moved against you by either adjusting the strikes or just waiting for some kind of mean revision in the underlying security due to the short duration and rapid time decay.
- Despite good open interest and volume, some strikes might have very wide spreads, and that is not good for short-term strategies.
Top 9 Best Stocks for Weekly Options Trading
1. Dow Jones Industrial Average (DJX)
2. CBOE Volatility Index (VIX)
CBOE Volatility Index (VIX) Best Stocks For Weekly Options Trading
CBOE Volatility Index (VIX) Best Stocks For Weekly Options Trading 3. S&P 500 Index (SPX)
SP 500 Index Best Stock For Weekly Options Trading4. CBOE Mini S&P Index Options (XSP)
CBOE Mini S&P Index Options (XSP)5. MSCI EAFE Index (MXEA)
6. MSCI Emerging Markets Index (MXEF)
7. S&P 100 Index (American style) (OEX)
8. S&P 100 Index (European style) (XEO)
9. Russell 2000 Index (RUT)
As stated above, trading weekly options are not for the faint-hearted. This trading strategy is filled with risks and only those who have extensive knowledge of the markets and suitable tools and techniques can stay ahead of the game. If the strategy’s benefits outweigh the risks and you are tempted to give it a try, check out these courses The HV7 Option Trading System – Aeromir and The A14 Weekly Options Strategy – Aeromir to better your weekly options trading skills first. We hope that once you are ready to take off, this list of the best stocks for weekly options trading will get you fly high.