That’s how you know it’s working! To this day I feel like dealer positioning blows my mind almost everyday, especially when combined with price action (which we didn’t get into here but will soon).

I appreciate the support, over time it will come together. I think it would be worth taking a step back to talk about exactly what dealer positioning is & the basics of it regarding delta hedging and how gamma/vanna dynamically impact it to help with videos like this where some assumptions are made.

Happy to do it, I hope we can do more soon!

Dealers are a special subset of institutions referred to as hedge funds or market makers. I know of 6 total and they have special arrangements with the exchanges/brokers to provide liquidity to the markets in the way of options or pairing buyers to sellers. It’s the whole reason we see markets hunt liquidity and run stops - it’s them meeting their objective of matching buyers to sellers. The customers include retail, but are primarily large funds and banks like JPM, TRowe, etc. for instance when JPM puts its monthly collar spread on, they are purchasing the large amount of options from dealers. Dealers don’t want directional risk, they want to make their money from the providing liquidity/options. If you think about all the option chains across all assets, strikes and expirations, it’s primarily them that can fill the demand of buyers and sellers. If they can’t match a buyer to a seller, they’ll sell it themself and hedge using futures or shares to ensure they don’t have directional risk. They hedge is based on delta which is Gamma/vanna/charm are so important - they change delta and therefore dynamically change the hedging requirements.

@@FattyTrades Thank you very much for the reply

No it’s different strikes and expirations that the JPM collar trade. I have to go back and verify but I believe those can be seen.

Yes I need to do a video on it. There’s a bunch of ways to use the data. For instance if we have large positive GEX levels above and vanna magnets below, you could set credit spreads above that gamma. Or if there’s a large vanna magnet expiring a certain day, set butterfly spreads on those gamma levels expiring slightly before that date and close them out as price consolidates on those levels. I plan to do a whole video about structuring spreads and another video about how I use them intraday.

@@FattyTrades Did you ever get to this? Please link if you did a video on it.

That’s correct, you can compare to the y-axis for positive/negative values

You can join it here. If you are a Vol.land subscriber let them know and they’ll upgrade your access discord.gg/wNTUpfnT

@@FattyTrades thank you kevin. Just one more question, do you give some kind of paid training, or similar where I can access all your knowledge. I like how you analyze and I am a faithful reader of your twitter as a viewer of the youtube channel. But if there is any other place where you can be located, let me know, thank you very much for everything

No it just means as price moves towards that negative vanna, dealers would buy if it’s under the current price and sell if it’s above. Negative vanna is a repelling force