Hey traders,
A lot of folks think volatility is the enemy.
They hear the VIX is spiking, or see a stock swinging $20 in a day, and they want to run for cover.
Me? I pull up a chair.
Because volatility is where the real money’s made.
Of course, it’s got to be the right kind of volatility.
Volatility = Opportunity
Let’s keep this simple.
Volatility just means prices are moving. And if prices aren’t moving, there’s nothing to trade.
Now, wild swings on some illiquid penny stock? That’s chaos — you can keep it.
But short bursts of big movement on a liquid, well-known stock? That’s gold.
When a stock like Tesla or Nvidia starts swinging, option prices get juiced.
And that’s where I go to work…
My Kind of Setup
Here’s how I use volatility to my advantage — without betting the farm.
- Short timeframes – I’m in and out in a few days, sometimes just one. I don’t give the market weeks to turn against me.
- Defined risk – I use spreads. That means I buy one option and sell another against it. It caps my risk, cuts the cost, and still lets me pull solid returns.
- Clear targets – I’m not out here trying to make 500% on every trade. Most of my wins are around 50% on the spread. Hit the target, take the money, move on.
Why It Works
Volatility pumps up option premiums.
That means if I can get in when the move is starting, I’m riding that wave while the market’s paying me extra to do it.
And because I’m using spreads, I’m not shelling out crazy money for a call that’s more like a “lottery-ticket” than a smart trade.
My risk is controlled, and I know the max I can lose before I even place the trade.
Real Example
Last week I put on a trade on TSLA:
Bought the AUG 15 $317.5 call
Sold the AUG 15 $320 call
Paid $1.15 for the spread
My target? 50% gain.
The whole thing lasted 24 hours. No drama, no sleepless nights.
Just in, out, and on to the next one.
The Big Picture
Volatility is like a power tool. Handled right, it makes your work faster and more profitable. Handled wrong, you lose a finger.
So I don’t chase every blip on the screen. I stick to my plan, pick the right trades, and let the volatility work for me — not against me.
If you can learn to do that, you’ll stop fearing volatility… and start seeing it for what it really is: the trader’s best friend.
Trade well,
Jack Carter
P.S. History says the tech sector could start getting volatile… how do you think I’m handling it? See right here.
