 What's up trade hackers welcome to today's update today's Monday January 27th before we jump into the market I just want to make sure you are aware of The new strategy class that we are doing tomorrow. It's called the portfolio bunker strategy web class It is tomorrow January 28th at 4 p.m. Central time you don't want to miss this especially in light of what we are seeing in the markets the last couple days This strategy is designed to protect your portfolio Let me give you the link here before I go too far, but basically just go to navigation trading comm slash sm Dash Registration and that's where you'll come to this page and just click save my spot And that'll save your spot for the web class tomorrow But basically what we're going to be talking about is how to protect your account from the next black swan event Now is this the start of a black swan event? We don't know. Is this corona virus going to spread further than anyone expects? We don't know and that's what a black swan event is is when some unknown event Takes the market to a new level on the downside that we're just not we're not expecting So it's what we're also going to talk about how adding this one simple strategy allows you to be more aggressive with your other Positions the top symbols that we use for the bunker strategy how to manage your bunker So you have a very little chance of loss not only on the strategy, but for the rest of your portfolio as well and How to create a hedge without the performance drag? so if you're using short strategies like long puts or Verticals, you know, those are great. Those are great short Delta type positions But they can also have a drag on your performance when the market just continues to rip higher So we're going to show you how to implement this in your portfolio Whether the market's going up or down it'll provide that protection The other thing that you'll learn here is it doesn't matter if you have your 401k through your employer an IRA a real estate portfolio a stock portfolio a mutual fund portfolio This is going to help protect your asset. So you don't want to miss it again Just go to this link navigation trading comm slash sm dash registration sign up Make sure you can be there tomorrow, January 28th at 4 p.m. All right, let's jump into what's going on in the market So the market closed about 20 minutes ago and S&Ps are down about 54 Big down day on Friday and then another big down day today So continuing to see that downside action down down 450 Nasdaq down 190 Russell down 20 So big moves in the market overall now I've been talking about this because this is also what this new bunker strategy has to do with is What's the relationship between the movement in the S&P and the VIX because the VIX is priced directly off of SPX options So the SPX is down 1.5% today and what's the VIX doing? It's up 25% so on average for every 1% move in the S&P the VIX moves 9% But in this case as you can see the velocity of what can happen is the S&P's down one and a half But the VIX is up 25% So this is all relative to what we're gonna be talking about tomorrow. So make sure you can make it So what else is going on? Well a couple points. I want to make one is okay Yeah, it looks like this coronavirus may be a little bit more serious than we initially anticipated but on the flip side of that I Think the market is also just looking for an excuse to make a pullback, right? Anytime you have a rally with very little pullbacks I mean at some point it's just gonna pull back no matter what's going on So the media can say it's coronavirus it probably has a lot to do with it. No doubt But at the same time think about this now I you know with a with a virus like that you can think about okay Let's go to like win casinos for example, okay, not as many people might be traveling to Crowded areas like a casino so that wins down 8% today All right big move down leading up to their earnings in win I can expect that airline stocks would be down if we look at Delta Airlines for example down A little over almost three and a half percent. Okay, I get that people may want to travel less because of a virus like this but What does this virus have to do with Netflix? You know, so for example, I mean if we look at Netflix Netflix is down almost 3% Okay, is that Due to the virus. No, I mean that's just it's in the downdraft of everything else in the market And so you also want to be a little bit aware of okay. Yeah, the market's down Yeah, okay, this coronavirus is potentially causing this scare in the markets, but you look at you know stocks like Netflix I mean if anything else people are gonna sit home and watch more Netflix because because of this, right? So we'll see what happens, but regardless this situation is causing a spike in implied volatility across the board I mean if you look at EEM, which is emerging markets IV percentile jumped up to 93 today EWZ, which is a brazilian index IV percentile jumped up to about 41 IV ranked up to 49 today EWW the Mexican ETF IV percentile spiked up to 60 Xrt which is retail got a little bit of a spike not not like some of these others We sold some premium today in XBI You know IV percentile up to 90 in XBI FXI which is the Chinese large cap Obviously the outbreak of this coronavirus starting in China Obviously seeing a major spike in implied volatility there. We sold some premium there and fried on Friday We also did a new duck in the SPX you see IV percentile and SPX spiking up to 89 so Regardless of the reason it creates opportunity. I mean this is the time when you can start selling premium I mentioned in kind of my morning update in the community is you know on the first sign of a spike in implied volatility You don't necessarily want to load the boat right spread out your trades stay small You know look at different expiration cycles different time frames different symbols different uncorrelated symbols You still all the mechanics that we teach still stays the same So we don't vary from that. We don't load the boat just on a situation like this You still have to be smart about what you're doing. So hopefully we get some more action tomorrow And again, don't forget go to this link navigation trading comm slash SM dash registration Get signed up 4 p.m. Central time tomorrow. We will be doing the portfolio bunker strategy Look forward to seeing everybody there. We'll talk to you then