Earthquake Rocks Markets: Immediate Opportunities For Traders

Opportunities for “gapping” stocks

Finding stocks that “gap” rather than slowly make moves over time can be a great opportunity for long option holders. A gap occurs when the stock closes one day at a certain price and opens up significantly higher or lower the next – giving long option traders an advantage as there is no chance to lock in profits too early  because of the gap.

Most novice traders see profits and they want to lock them in as soon as they present, but when you trade stocks that are “gappy”, this forces traders to stay in the trade longer and potentially grab bigger profits.

Finding stocks that “gap” rather than slowly make moves over time can be a great opportunity for long option holders. A gap occurs when the stock closes one day at a certain price and opens up significantly higher or lower the next – giving long option traders an advantage as there is no chance to lock in profits too early  because of the gap.  Here are 5 advantages to trading these names:

1. Get in on stocks before the “major players” do
2. Requires less monitoring than traditional stocks
3. Ride the momentum of a stock that's already moving
4. Stay in a trade for a longer period of time and potentially make more money
5. Profit from stocks that gap rather than slowly making moves

*$TUR is an example of a “gappy” name… notice how the stock consistently opens away from the previous day’s close?