On Monday, I laid out my plan for entering into $SPY Iron Condors steadily throughout the week. I entered into the final Iron Condor this morning and wanted to give you a little update on where we stand with them.

This is the video recording of the March 2020 Conference Call.

There are a lot people openly talking about the potential for the stock market to close while this coronavirus pandemic plays out.

This is a valid concern.

Naturally, the question becomes: "What happens to any open options positions I have on if expiration happens during a market closure?"

I'll start by saying: this is no ordinary week. But you knew that.

If you are sitting on the sidelines, waiting for all this craziness to subside, that is not a bad idea at all. There is no reason to put our money at risk if we can't get a handle on our own emotions during this highly uncertain time.

That said, for those who are willing to wade into these choppy waters with me -- these insane premiums offer us the ability to sell premium FAR away from current prices. I'll share with you my simple game plan for this week.

Risk management has to be our number one focus right now. This is no time to be lazy, hoping, or praying.

Yes, if you're willing to wade in carefully, there can be some great opportunities for premium selling. But even then, we still have to be extra vigilant in protecting our capital.

I bring this up because I received an email from someone recently who didn't follow his rules, and now finds himself severely underwater and wondering what to do next. We've all been there. Something unexpected happens, and now we're like a deer in the headlights too frozen with indecision and unwilling to make any move whatsoever because we're afraid we are going to compound the situation for the worse. It sucks.

Here's the situation my friend finds himself in. Let's learn from this.

Yesterday, $VIX printed the highest level we've seen since the financial crisis in 2008. That's a twelve year high.

It exceeded the "government shutdown" spike of 2011, the Chinese stock market scare of 2015, the 2016 election fear mongering, and the Brexit noise.

Editors note: The chart police (aka, JC) would like me to point out that this is a weekly chart and the last bar on this graph is not complete. The horror!

We can point to a couple big reasons why volatility is spiking (Coronavirus, oil crashing) and a few smaller ones (we're overdue, debt, whatever....). But none of that really matters. Only price pays, right @Alphatrends?

Things are whippy out there. And volatility is elevated to levels we haven't seen in quite a while. This is no time to be a hero. This is the time to focus on edges and putting them to your advantage.

I know it's sexy to be a buyer of calls if you want to be the hero bottom caller. Similarly, it's equally sexy to be a holder of long puts into a market crash. But this is not the time to be initiating new long calls or puts positions. The premiums you'd pay are so high right now that you could totally nail the direction, but you'd be swimming upstream against an eventual mean-version in volatility pricing.

But this does not mean we pick up our ball and go home. We options traders have options!

In this environment, we're looking for plays where we are net sellers of premium. With premiums this juicy, it would be irresponsible to do anything else.

The boys were out with a bullish piece on China stocks, citing oversold conditions. As JC said: "If the world isn’t ending after all, this could be an interesting place to look for huge winners."

So I've got my eye on a big name that has held up pretty well, all things considered.

As March gets under way, it’s time to review positions with March options that remain open (haven’t already hit profit targets or been stopped out).

Wild couple of weeks, but that doesn't mean we deviate from our plans!

Most trades I put on for All Star Options tend to have a minimum duration of 30 days (short premium plays) and often as long as 6-8 months (for long premium plays). As options approach expiration, greeks like theta and gamma start to become my enemy and whipsaw my P/L. Therefore, as options and spreads get into the expiration month, my best practice is to put each position on notice — it’s time to take action.

The current market calamity is certainly not sparing many of our long or delta neutral positions. The good news for us is the majority of them have defined risk.

At the open this morning, many of our positions traded through our stop-out levels. But an important point to remember here is that we're looking to see a CLOSE below our stop levels. We're don't jump on an exit the second a level is broken intraday.

There is a lot of trading left in today's session. This is not the time to be dumping defined-risk positions into the hole.

Careful what you wish for?

Options premium sellers profess a deep and undying love for elevated volatility. But when they get it, are they willing to act? Sometimes when you're in it -- like right now -- it can feel very scary. The urge to sit it out may overtake you. I get it. Been there.

For those of us who plow ahead and like to take advantage of opportunities when statistical edges are backing them up, this next trade is for us.

Cool your jets.

Some of you are in the BUY THE DIP camp and champing at the bit to make a heroically timed buy here. Others are in the APOCALYPSE camp and are eager to "short-the-world!"

What if both sides are wrong?