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Good afternoon, this is James Cordier of OptionSellers.com with a market update for July 2nd. Well, with the first half of 2018 now in the books we start looking forward to the 3rd and 4th quarter of what has been a very loud economic market. Talks of tariffs in China and interest rates, inflation finally beginning; however, many commodity prices basically in a sideways trading fashion. Who in the world would think that the gold market would make a very strong move earlier this year with North Korea and the United States trying to draw battle lines. Interest rates negative in Europe and, of course, what’s always going on in China and now tariffs. We took a speculative move thinking that commodities, especially precious metals, would probably start languishing and going into a sideways fashion. So far this year, that’s exactly what has happened. Silver has traded in approximately a $1 trading range, gold has traded in approximately $80-$85 trading range for the first 6 months of the year. To watch some of the business shows, you would think that those had made large moves, but actually that’s just a lot of noise and a lot of headlines, which, of course, plays into our hands. A lot of discussion about China, interest rates, and inflation cause a lot of investors to buy options and, if we’re following along correctly, quite often the fundamentals don’t justify a big move, and then you sell calls much above the market and puts much below the market, and certainly that has worked out quite well so far in 2018. The new market that is now possibly heading into a consolidated type would be crude oil. The crude oil market has had dramatic moves over the last 24 months. Right now, we feel that that could be turning into a sideways market, as well. Both Russia and Saudi Arabia recently have discussed and arranged to increase production somewhat going forward. Clearly oil, which has increased now some $10-$15 a barrel over the last 6 months, is probably going to start pinching some of the economies around the world. If you were to look at Germany, for instance, they have some of the most negative business ideas right now going forward. We still have negative rates in Europe and, of course, China this past week entered what’s called the bear market where their stock market is down over 20% from its high. High energy prices during times of weaker economies around the world is probably not going to sit very well. Russia, Saudi Arabia, some of the largest oil producers, they know that and they don’t need to be greedy right now. They have produced oil for $35-$40 a barrel and trying to push it above $80 and turn some economies into recessions. That certainly is not their idea. We think that oil is probably going to start settling into a $10 trading range, Brent probably in the 70’s, and WTI in the 60’s. We think that putting a $50 strangle around crude oil right now is an excellent idea, similar to what we did in the precious metals earlier this year. We think both of those positions are going to continue to bear fruit in the last half of 2018. We will just have to wait and see. Anyone wanting more information from OptionSellers.com can visit our website. If you’re not already a client of ours and wish to become one, you can contact Rosemary at our headquarters in Tampa, Florida about possibly becoming one. As always, it’s a pleasure chatting with you and looking forward to doing so again in 2 weeks. Thank you.

TD Ameritrade: Cordier Gives New Oil Price Forecast James Cordier Ben: Welcome back to Futures with Ben Lichtenstein. Traders, with OPEC’s recent decision to increase production, crude has been the focus for many. To help us take a look at the recent price activity in the energy markets and the impact from the recent OPEC decision, traders, we’ve got James Cordier, the President and Founder of OptionSellers.com, joining us this morning. James, welcome to Futures with Ben Lichtenstein. Crude rallied on the news but no follow through. Does this point to the decision having already been priced into the market? For the most part, was this move expected? James: Ben, it’s really interesting, the movement in crude oil after the announcement. I think what OPEC and, of course, plus Russia was trying to do was give a soft landing. I think they’re very familiar with the fact that oil prices can’t continue to escalate as many U.S. economies, as well as in China and Europe, are slowing. We have PMI in Russia and both China not doing so well. Of course, we have China down 25% from their recent high and a soft landing is very important. Needless to say, having the market just fall out of bed is now what they wanted either, so we had a very quick $8 decline in prices. We’ve now rallied back about half of that and it’s possible that we’ll fall into a nice equilibrium here with plenty of supply but not too much to cause prices to go higher. Ben: Yeah, it looks like we have a bit of a range forming up above 64 and below 73. James, I’m wondering, how much of a boost in production is to slow the pace at which they’ve been reducing inventories, and how much is to combat the reductions in production that we’re seeing related to sanctions and issues in Venezuela, because the $1 million increase in production isn’t going to be enough to balance off both. James: It’s really not. You can add Libya to that last, as well. The fact that we had over compliance coming into this meeting allows both Russia and Saudi Arabia to actually pump more than what the report came out here 3 days ago. The fact that we’re talking only 600,000 additional barrels, that is not going to be enough, you’re correct, to take care of what’s coming offline in both Iran, Venezuela, and in Libya; however, there is a lot of fudge room right now available. The fact that both Russia and Saudi Arabia now have the green light to pump more oil, I think we’re going to see in the 3rd and 4th quarter probably closer to an additional 1 million or 1.1 million barrels. The 600,000 that was announced is not enough to slow down this market. Ben: Yeah, it seems to be the case. We’ve been hearing a little bit about distribution issues as far as the WTI production as it nears that 11 million barrels per day level. Is some of the narrowing that we’ve been seeing in the Brent/WTI spread related to the bottleneck that we’re seeing in distribution? James: That’s exactly right. What’s going on right now in the United States is we do have a great deal of new supply coming on, but there is a bottleneck and it is allowing the Brent/WTI to narrow. I think we’ve seen that just recently and we’ll probably see it narrow another dollar or two in the next upcoming weeks. Ben: James, talk to us a little bit about what’s going on here as far as what you’ve been seeing and hearing regarding Canadian oil sands and the outage. Is this impacting the spread or impacting price at all? James: Not as of yet, but it’s very interesting, the price of oil coming up and then the Canadian dollar coming down recently is a really interesting conundrum there. What’s going on in the Canadian oil sands will come out to play in the next several weeks. There hasn’t really been a big market moving affect there yet, but that will be coming up if it doesn’t get straightened out soon, I think. Ben: James, I’m curious because everyone’s joking about OPEC plus one right now, meaning that Russia seems to be more and more influential and I’m curious if you could talk to us about the role that Russia had in the recent OPEC decision. Is Russia’s involvement a good thing for the stability of energy markets? James: You know, with Russia, Ben, being the 2nd largest producer now in the world, they have to be in just about every conversation. The compliance between OPEC and Russia right now has just been fantastic. I think it’s almost like the most incredible central bank right now in reference to oil. The Saudi and Russian compliance right now it looks excellent. We think that Vladimir Putin’s going to be in office for probably over the next 10 years, so he doesn’t have to be a short-term thinker. He can think long-term, find out the exact price that the global economy can withstand without throwing it into a recession, and that team right now has been excellent. I think Russia would be really happy with a $75 Brent price going forward and I think that’s the equilibrium we’re going to see. I could see a $10 trading range for oil the next 6-12 months and WTI in the mid 60’s and I think everybody would be happy with that. Ben: Yeah, except for those traders that are looking for a high volatile market but, James, let’s talk a little bit about the dollar correlation to the crude because we’ve been watching the crude come off. The dollar, for the most part, has been hanging out around that 95 level. I’m curious, what are you seeing in terms of that inverse correlation breaking down a little bit recently but I’m wondering if, now that we have the OPEC news, if that correlation is going to start to come back into play a bit? James: Ben, the interesting part is the U.S. dollar and the strength of it over the last several weeks. Clearly we’ve come off just a little bit recently but we have negative rates continuing throughout Europe, we have one or two more hikes coming in the United States over the next 3-6 months. The dollar is going to continue to be underpinned and that is going to probably help keep a cap on oil prices, as well. Of course, oil being priced in U.S. dollars, a firm dollar, I think, through the rest of 2018, will help also balance what I think is a balanced market right now. Ben: All right, well that’s definitely giving us a little something to watch here today. James, I appreciate you coming on the show and joining us on Futures with Ben Lichtenstein. Traders, that’s James Cordier, the President and Founder of OptionSellers.com.

July 2018 Podcast James Cordier and Michael Gross Michael: Hello everybody. This is Michael Gross of OptionSellers.com. I am here for your July Podcast. This month’s podcast will be in audio format. I’m here with head trader James Cordier. James, welcome to the show. James: Thank you very much, Michael. Always happy. Michael: Great. The topic of this month’s podcast is Fast Cash from Selling Options in Over-Bought or Over-Sold Markets. James, as you and I know, we’re not really in the business of looking for fast cash, but we’re more in the business of long-term investments. Every once in a while, when you’re selling options, there comes certain opportunities where there might be a place to sell the option and you see that time decay in just the first 30-60 days. Often times that can be when markets get to an extreme, like some markets we’re seeing now. Wouldn’t you agree with that? James: Michael, it’s interesting, we are very long-term investors. When we’re looking at seasonal positions or headlines that create a slightly shorter-term opportunity, then we do look at things like timing and certainly all the headlines going on right now with trade are probably offering some really good opportunities of the slightly shorter variety and we’re looking forward to taking advantage of those over the next 10 days or so. Michael: Great. I know, as you and I have been discussing, as are most investors right now, the big topic is trade tensions with China. I don’t know if we call it a trade war yet, but certainly having got some investors attention and pushing the stock market around. Maybe talk a little bit about how that’s affecting commodities right now. James: Michael, if this doesn’t turn into a trade war, this is the most well played game that I’ve ever seen between the U.S. and China. I mean, we are right to the brink of what could be quite a significant trade policy coming down the pike. It is definitely worrying some investors that are looking at certain parts of the global economy. Uncertainty is always not welcome. Anyone who is looking at investing for their company or inventories or what have you, when they see uncertainty they usually hold back and that is probably going to be swelling some economic growth globally if this doesn’t come to a head here in the next week or two. Michael: Okay. As most of you listeners know, as far as being an option seller, it doesn’t really matter to you which way the market or prices are moving, especially when you’re trading different uncorrelated commodities. Often times, situations like this can create opportunities and that’s what we’re going to talk a little bit about today. James, would you like to go ahead and move into our feature markets? James: Michael, certainly. Natural gas is one of the markets that are very near and dear to our hearts. In the very heart of winter and the very heart of summer, which is coming up relatively soon, we did take positions in natural gas much earlier this year, trying to sell put premium. We were fairly successful doing that. Generally, the market bottoms in winter and rallies into spring and the natural gas market did that. Right now, we are looking at a seasonality for natural gas. It has had a very nice rally over the last 3 months or so and basically a lot of headlines talk about the need for natural gas in summer for cooling homes and cooling businesses, of course. We think that’s quite overplayed. Generally speaking, when it’s extremely cold in the U.S. or throughout Europe, demand for natural gas does spike and that is real. As far as buying natural gas for summer cooling, I don’t think the numbers dive exactly. It takes approximately 25% of the natural gas to cool a home in the summer as it does to heat a home in the winter so, generally speaking, when natural gas rallies because the warmer temperatures are ahead, that’s usually something you want to fade. Of course, at that time, inventories are usually being built in a very big way. So, we’re looking at selling natural gas calls over the next 2-4 weeks to take advantage of that seasonal position. Michael: Yeah, you make a good point there, James. The seasonal tendency for natural gas used to get a little bit of a spike in summer and, yeah, you can but it seems like the tendency over the last 5-10 years seems to be more of, as they build that inventory into spring and summer as those supplies rise, it tends to just kind of overlook the summer demand for just the reason you mentioned. Now we’re seeing a seasonal where the seasonal prices tend to start declining in June and keep going right through fall so it appears they’re following that pattern right now. Now, we’re not at a particularly high level of natural gas supplies right now. From what I’m seeing we’re a little bit under where we typically are this time of year. Is that what you’re seeing as well? James: We are. Natural gas supplies in the U.S. are under the 5-year average and they’re below levels from last year, not a great amount, but what a lot of market participants are looking at is all the drilling all around the U.S. Of course, the bi-product of that is natural gas. A lot of investors and a lot of the analysts in natural gas feel that $3 natural gas is probably a fairly decent price considering that drillers are getting it for free as a bi-product. So, it used to be that natural gas was produced in the Gulf of Mexico in Louisiana, and when you had demand shocks it really moved the market a great deal. The beauty of option selling is that some of that volatility is still in the market even though we’re now producing natural gas all over the country. We have just massive fines in Oklahoma, Arizona, and Kansas, the Dakotas, Pennsylvania, Ohio. The supply is always going to be there for natural gas right now and taking advantage of small swings, up and down, during the year should be fruitful for selling options and that’s why we think selling calls over the next few weeks is probably going to be a very good idea. Michael: You know, James, you made several good points there. In talking about the seasonal tendency, when we go back to where you were talking about selling puts in the spring when we recommended that in the newsletter, prices have rallied almost 10% since that point. Now, with supplies building, as you said, it can start putting a little bit more pressure on the price of natural gas, at least that is what you’re expecting. We’re going back to Fast Cash from Selling Options in Over-Bought Markets… I think two points, and maybe you can hit on both of them, one is natural gas, as of at least a couple days ago, hit a pretty good level where it was and looked pretty over-bought, especially for this time of year when you have a seasonal. Technically, the market is over-bought, that tends to push those option premiums up higher to where they get to an over-valued level at some point, especially with a little jolt like that. Also, natural gas is probably one of the markets that would be least affected by any type of Chinese trade tariff. Would you agree with that? James: Michael, the natural gas market that we trade here in the United States is purely a domestic market right now. It’s not coffee, it’s not steel, it’s not sugar. Those are all world traded markets and the natural gas market is probably 99% influenced by the supply and demand that happens within the 50 states. Of all the markets that we follow, several won’t be affected by the tariffs and natural gas is definitely the bull’s-eye of the one that will probably deem what goes on with tariffs probably be the least of all of them that we follow. Michael: Okay. So, we’re here at the beginning of a potential seasonal downturn here, at least that’s what we might be looking for. When you talk about this, and for those of you listening, natural gas is the feature market in our upcoming July newsletter, which you can keep an eye out for. It should be out on or before the 1st of July in your mailbox or e-mail box. James, in that, you’re recommending taking a look at selling call strikes at the $4 or above level. Right now natural gas is under $3, so we’re looking at strikes at least 25% above the current market. So, you’re not really calling a top right here, what you’re saying is, “Hey, it’s a 3, it’s not going to go to 4, especially at a time of year where supplies are building.” James: Michael, it certainly does look like an opportunity. The natural gas market has risen off the lows that we spoke of earlier this year and the ones you just mentioned recently. Natural gas was down to $2.50 and $2.55 earlier this year. Right now it’s approximately $3 so it has had a decent rally. We’re looking at strikes at $4, $4.50, and $5 and we think that the time to probably jump into those positions is really soon. We have had a nice rally in natural gas. A lot of it is based off of the hot temperatures that we’ve had in the Midwest and the Northeast recently. I’m looking at the 14-28 day forecast and it cools off quite a bit. While I don’t make that big of a deal over the temperatures exactly, a lot of traders do. That’s why I think we got this rally and we really like selling it here right about this level that we’re at right now. Michael: We go back to what we’re talking about here… The Fast Cash in Over-Bought Markets. Even if you’re going out deeper out-of-the-money contracts, which you recommend going out to December and maybe even March contracts, if we do get a typical seasonal move, which there’s no guarantee that happens, but if the price does and we get a pretty decent price drop over the next 30-45 days, I’m guessing what the market is still looking a little bit over-bought, you could see some pretty significant decay in those options. Is that what you’re looking at as well? James: It is. The decay on these options that we’re considering would probably, if in fact natural gas does have a slight decline going into the 3rd and 4th quarter,

Good afternoon. This is James Cordier of OptionSellers.com with a market update for June 1st. Well, lo and behold, CNBC, Bloomberg TV, and Fox Business are, once again, talking about Greek bonds, Italian bonds, and Spanish debt. Once again, Europe is smack dab in the middle of the radar screen. It’s so interesting that after practically 10 years of quantitative easing through the Euro zone, their economies still are struggling to get their heads above water. Some nations still have negative interest rates. Here we are, looking at some of the German economic numbers, consumer confidence is falling dramatically, PMIs throughout all the nations in Europe are doing basically a swan dive at a time where you would think of 8 or 9 years of quantitative easing they would really be forging ahead. It doesn’t seem to be the case. That could be the reason we’ve had $80 crude oil and, of course, all of Europe needs to import energy from other nations. $80 oil, of course, is quite a tax on the consumer and, of course, industries as well. What is this doing? This is probably slowing the global economy both here in the United States as well as in Asia. It’s just the first glimpses of it. It doesn’t appear to be a slowdown here yet, though we do seem to be in a bit of a stall speed in the U.S. and some of the foreign nations. Of course, interest rates in the United States are ticking up, approximately every 3 months. Whether they raise rates this year 3 or 4 times doesn’t really matter that much. It is underpinning the U.S. dollar and what that’s doing for us is providing a very stable commodities market. As clients, you all know we have many positions on. Where we’re actually predicting stable market prices. Identifying fairly value markets in gold, silver, crude oil, coffee, soybeans can be a great mainstay for option selling. Of course, as you know, we have $800-$900 strangles around gold. Gold over the last 6 months has barely budged. The silver market so far this year has been lopped into a $1 an ounce trading range. We have approximately an $18 strangle around that market. We really do like the idea of a strong U.S. dollar throughout the rest of the year, and that’s creating very stable commodity prices which, I think, is going to be very fruitful going into the 3rd and 4th quarter of this year. One market that’s finally coming around is the coffee market. We do have a trucker strike in Brazil and that is keeping some of the coffee off of the market. Of course, investors and speculators are racing in to buy coffee. We love the idea of selling coffee calls above $2 for later this year and early 2019 expiration. We think that’s going to be a great idea and we expect coffee prices to be half of the strikes that we’re selling right now. Our old friend coffee is becoming what I think is going to be a very good opportunity going forward. We’ll just have to wait and see. Anyone wanting more information from OptionSellers.com can visit our website. If you’re not already a client of ours and wish to become one, you can contact our headquarters in Tampa, Florida about possibly becoming one. As always, it’s a pleasure chatting with you and looking forward to doing so again in 2 weeks. Thank you.

Ben Lichtenstein: We’ve got a real treat here for you this morning, traders. We’ve got the founder and head trader of OptionSellers.com. Traders, we’ve got James Cordier with us this morning. James, welcome to Futures with Lichtenstein & Hincks. It’s a pleasure to have you on the show. I want to dive right into it. When we’re talking futures versus options I kind of think of it as futures for me are kind of easy versus options. It’s sort of like driving a VW versus flying a Cessna. Talk to us about some of the benefits of trading options and why they’re appealing to you, considering what we’re seeing here in the energy markets as of recent. James: You know, I think that’s a great question. So often, people talk about options and they kind of go like this. I understand they are puts and calls, but I think the gentleman you had on just a moment ago is just a great example as to why selling options can be a good idea for mainstream investors. The gentleman prior to me was talking about trading in currencies and he talked about close stops and you’ve got to watch your lows and watch your highs, and you need to have a close stop on all of your positions. Shorting options and selling premium is just the opposite of this. If you want to take a long-term fundamental view on gold, as you’d just been describing, or crude oil, this is the way to do it because perfect timing, I’ve been in this business for almost 30 years, I don’t know anyone who knows how to do that… not on a consistent basis; however, we’re looking at energy prices right now. The crude oil market is extremely frothy, especially with slowing global growth. Europe right now is probably what brings us to mind right now, as far as the oil price, might be at a reflection point. With PMIs going south, with consumer confidence in Germany, I was just in both Italy and Germany this past week and, while pizza sales were really good, and I can attest to that, the rest of the economies are not doing so well. $80 and $82 oil Brent is going to probably be very detrimental to European economies. We’re looking at a possible reflection point right now in crude oil. Instead of trying to pick the exact copy, because of course no one else is of course able to do that, we’re going to start looking at selling a call premium on crude oil. We’re going to go out 3 months, 6 months, 9 months, sell the $90 calls and the $95 calls and that way we don’t need perfect timing, but we simply need to be right the market eventually. A lot of the fundamentals we’re seeing in oil going forward into the 3rd and 4th quarter lead us to believe that we’re going to be right on this. Kevin Hincks: Good morning, James. Thanks for coming on the show. It’s always a pleasure for me to talk about options when I’m on this show. I spent most of my career doing that. So, you are talking about the 90 calls above the market, right? Selling something very safely above the market here, about $18-$19. You also talk about selling the 45 put so you’re creating a short option strangle, right? Where you basically want a range-bound trade in between your strikes. Now, the question that option traders have is, “Do you think, based on the risk that you’re assuming, now you’ve given yourself a nice wide in between the navigational beacons, I call it, of your short strikes. Are you getting paid enough for the risk that you’re putting on?” James: That is such a great question. So many of your investors, I’m sure, are familiar with selling options on stocks. I hear about this all the time. When we have a new investor they’ll say, “James, I was introduced to short options through my stock broker. We started writing covered calls and then I got a little creative and started selling options on stocks. I hear that you’re selling options 2%, 3%, 5% out-of-the-money.” In commodities, crude oil, gold, coffee, we’re selling options 50-60% out-of-the-money in some cases. When we’re identifying a strangle, the window is just absolutely enormous. The crude oil market, based on fundamentals right now, is not going to fall into the 40’s. We have, of course, Brent around 80 right now, WTI right around 70-71, but it’s not going to go above 90 and that is just a fantastic window for the market to stay in. Identifying fairly priced commodities is probably the most wonderful thing that we do for our clients. Often, an expert comes on and he talks about, “Well, the coal market’s about to go to the moon” or “Soybeans are going to go to zero.” As we all know, quite often that’s not the case. Finding a window that a market is going to stay inside is just a fabulous way to create a strong performance at the end of the year. We’re collecting $600-$700 for the $90 calls. We’re collecting $600-$700 for the 45 puts. Basically, selling a strangle, as you know, is one position babysits the other while you wait. So many investors want to get paid right now and when they’re talking about selling options on commodities they need to get in “right now”. We don’t do that. We want to sell options much further out in price and much further out in time than most people, but we get paid to do it. Ben Lichtenstein: Yeah, James, I know that you think that 85 is a bit of a tipping point, and possibly that tipping point that would bring Europe back into a recession. Talk to us and tell us a little bit more about why you think that. James: What’s interesting is all you have to do is look at the Euro, and you look at banking stocks in Italy and Germany right now. That tells us that the European Union cannot withstand $80 oil. OPEC right now has to have another discussion. 2 years ago, they discussed cutting production. That has worked tremendously. They need to not be too greedy right now. $80 oil, everyone is making a ton of money producing oil here in the United States and everywhere else. Pushing Europe into a possible recession could absolutely kill the golden goose, if you will. Other producing nations produce oil for $35-$40 a barrel. It’s trading at $80. The last thing they need is a recession in Europe because you know what’s going to happen after we start talking about Greek bonds and Italian bonds? Then the stock market starts to dive and $80 oil prices will be history if that happens. Kevin Hincks: Hey James, as you know, when it comes to the oil markets that there’s a mid-June OPEC meeting coming up where they’re going to re-look at or re-investigate the production cuts. Here’s my question for you: Is the most important person coming to the June OPEC meeting a non-OPEC member, being Russia? I think that they’re chomping at the bit to up their production and get back in this game, back to their old levels. Are they the most important player in this mid-June OPEC meeting? James: Yes, they are. Saudi Arabia and Russia have been just great partners recently. Saudi Arabia’s probably the smartest OPEC nation in the room and they are going to be siding along with Russia. We’re looking at the spigots opening up. They have to. They are very extremely great traders and they understand that throwing a slow-down in global economy is the last thing that they need right now. I think they would be very happy with a $72-$74 Brent price. I think producing more oil, especially in Russia, is going to help that happen. We do see, at least by the 3rd quarter, production cuts going away and oil prices probably settling down $5-$7 from where it is right now, at least. Ben Lichtenstein: All right. Lastly, James, I’m curious your thoughts on Shale production because everybody’s dialed in on the increased production up about 10 million barrels per day as we’re nearing 11 million barrels per day, but, you know, not everybody’s focused on the fact that without this added production levels that we probably see crude oil at a lot higher prices. A lot of people are saying, “Why hasn’t this increased production, keep the price of crude down?” Is it your thought or opinion that without all of this added supply that we’d be up and through this at $75 level right now in the WTI. Is that production what’s actually holding us down a bit? James: What’s holding us down right now is the production. If 11 million barrels a day were being produced in a country that is a third world nation and doesn’t have a huge population of drivers and such, that would make a big difference, but, you know, we are using basically all the oil we need. What really changed the market recently is the fact that the U.S. is now exporting oil and that has really made it more of a global market. The fact that we see such a discount to WTI versus Brent tells us that oil production in the United States is around 11, adding up to 12, and, at that point, $80 oil for Brent and $70 for WTI is not going to last very long. We really see Brent down, like I was saying, $5-$10 this year. What’s going on in the United States right now will keep oil prices from doing the super-spike and I think we’re at a reflection point pretty soon. Ben Lichtenstein: Yeah, we’re watching that spread closely, too, right around 7 ½ right now. Traders, that’s James Cordier joining us this morning and he’s the President and Founder of OptionSellers.com. He’s also the author of The Complete Guide to Option Selling. James, it’s always a pleasure to have you on the show. Really good insightful thoughts there in terms of options and the energy markets.

Michael: Hello everyone and welcome to your June edition of the Option Seller Podcast. This is Michael Gross of OptionSellers.com. I’m here with head trader James Cordier. James, a lot of talk this month about bull market in commodities. It’s been getting a lot of media attention, obviously crude oil has been leading the charge, but what are your thoughts on that? Are we in a bull market right now or is it just speculation? James: You know, most often, Michael, at the 3rd and 4th and 5th year of an expansion economically is usually when prices of commodities start going up. There’s usually a glut of commodities during a recession. As years go by, a lot of the excess commodities are then purchased and consumed, and usually that is when you start normally getting higher prices. I do believe we’re in a bull market in commodities. It is lead by energies, which of course was pretty much facilitated through OPEC cuts in production, but let’s face it, practically everything comes from a barrel of oil. Whether it’s cotton or soybeans or coffee or what have you, everything derives off of a barrel of oil or a gallon of gasoline. Of course, energy prices have really risen quite a bit over the last 18 months. That leads us to believe we are in a bull market in many commodities. There are 1 or 2 that have certainly oversupply in them, but the commodity market has been in a nice uptrend. Usually, this does happen 3 or 4 years after the beginning of an expansion and its kind of textbook so far. Michael: So, we have oil markets possibly leading the charge here. Some of the grains have been aided by some weather issues. Do you see this spreading to all commodities or is it primarily limited to a few sectors? James: I think it’s limited to a few sectors. If you look at the price of sugar or coffee, we’ve got just massive production expected in South America this year. The coffee market recently hit a 12 month low, the sugar market recently hit a 12 month low, so it is really a market that needs to be picked, if you will, to be in a bull market. A lot of commodities do have up trends, but some of the major commodities that we follow are over supplied. I think that’s why we really enjoy doing what we do best, and that is analyzing fundamentals on the different markets, simply buying a basket of commodities or selling a basket of commodities. I think you can be more sophisticated than that, and that’s what we try and do here, of course. Michael: Yeah, in the media they like to get a story line, “Bull Market in Commodities” and that’s what they tag and they really maybe only focusing, as you said, on a few markets, some of the other markets. That’s why you get that play within the commodities where they’re not really as correlated to each other as maybe stocks. James: Certainly not. That’s where diversification comes in. If you’re long or short the stock market, basically you’re living or dying by if it goes up or down. Of course, in commodities, we follow 4 different sectors about 10 different specific commodities and they really do have their own individual fundamentals, and that’s what makes following the same commodities for so long very prosperous, because you do get to know them. They all do have personalities. You don’t simply buy a basket of commodities like you do stocks. It’s different than that. Michael: So, the person watching at home now and they’re saying “boy, it’s a bull market in commodities. This must be a good time to sell options”… that’s really kind of irrelevant if you’re an option seller, isn’t it? James: You know, the interesting commodities, I think, is what bodes well for us. Whether you’re selling options on your own or you’re doing it with ourselves, it does increase premiums of options on both puts and calls. Certainly, the interest by the speculator, whether it’s a bank in London or whether it’s a hedge fund somewhere in San Francisco, it does increase the value of the options. If you are picking up bull or bear market, it allows you to get in at very good levels, sometimes 40-50% out-of-the-money depending on which market it is. Michael: So now matter which side of the market it’s on, the media coverage of prices going up brings in a lot of public speculators and that drives premium. James: Whether you’re selling options on your own or you’re doing it with us, it really plays into your hands… it really does. Michael: Great. We’re going to take a look at a couple of these markets that’ve moving pretty good to the upside or we feel we have some pretty good opportunities to look at this month. Why don’t we go to the trading room and get started? Michael: Welcome back to the market segment of this month’s podcast. We’re here in the trading room with head trader James Cordier. The title of this month’s podcast is taking advantage of the bull market in commodities, and we’re going to feature a couple of markets this month that are leaders, what’s driving the bull market in commodities, but how to take advantage of it might not be exactly how you think it would be. A lot of people might think, “Oh, well I’ll just go out and buy a commodities index fund or maybe I’ll buy some individual commodities stocks or what have you”, and the problem with that is, one, as James mentioned earlier, sometimes these commodities aren’t all going to move together. So, you may buy one commodity and it’s not going to participate in that bull market like other stocks wood. Also, we don’t know when this bull market might end, so we want to position ourselves so, yes, we can keep taking advantage of this if the bull market continues, but also if it stops tomorrow we still want to be able to make money. So, we’re not going to position how just a common traditional investor might try and position. We’re going to talk about selling options here. Let’s go to the first market for this month… the cotton market has been one of the leaders of the commodities bull here. Obviously we’ve had a pretty sharp rally here since last October, James. We’re up almost 25% in prices through this week. What’s going on here as far as prices go? James: Cotton’s another example of one of the bull markets of 2018. We do have some more demand out of Asia than we thought. They were speculators that thought that supplies in China were slightly less than what early was previously expected. Cotton production in China is supposed to be down slightly because of some weather. Of course, the big news is we had just an incredible drought to start out the planting season here in west Texas. Basically, commodities like soybeans and cotton, everyone’s so concerned about the weather and when they talk about dry conditions or there’s drought going on, speculators come and bid up the market. A lot of the end users then need to get insurance and they’ll buy futures contracts for cotton, as well, and that really boosts up the price usually right as growing season is beginning. That’s what we’re here looking at again today for the cotton market in 2018. Michael: Okay. So, that drought has been pushing up prices, but here in the last couple of weeks, that started to lessen a little bit. We’re looking at a map here of Texas, west Texas, big cotton growing region. If you would’ve looked at this map, the darker colors indicate a severe drought portion, so we still have some going up in northern part of Texas, but if you would’ve looked at this chart 3-4 weeks ago, almost half of Texas was in that red. So, this has mitigated quite a bit to where we are right now and that has allowed a lot of these planters to really make some progress in planting over the last couple of weeks. As a matter of fact, stats we just pulled today, James, at the end of the week of May 13th they were 28% planted. At the end of the week of May 20th, Texas farmers were 43% planted, so that’s a lot of progress to make up in a week and that’s due to that they finally got some moisture. They were able to get the crop in the ground. 5-year average is only 33%, so they’re actually ahead, quite a bit ahead, of where they normally are in a 5-year average, so that moisture they did get has really done a lot of good for the Texas crop. USDA just came out with their most recent/first estimate for the ’18-’19 crop. You’ll see here, James, ending stocks actually above last year is what they’re targeting. James: Really a weather market right now. Anyone who lives in the United States, especially in the eastern half of the United States, I know we have clients and viewers from all over the world, but here in the U.S. it’s raining all the time. Precipitation is just dominating the weather market right now and, in the chart you just mentioned, for the Texas state, that was truly an extremely dry condition and that has mitigated quite a bit. We’re now 5-6% above the 5-year average for plantings. We now have precipitation coming in. We’re going to wind up having a larger crop than a lot of people thought about and then we’re going to have carry-over in the United States, the highest level in 10 years. I know a lot of people are going to look at this, “well, the carry-over was much higher 8-9 years ago”, but cotton was also around $0.40-$0.50 a pound then, too. That’s a big difference. Michael: One other thing we should probably bring up that’s really carrying a lot of weight here is that cotton also has a very strong seasonal tendency. Actually, it doesn’t even really start to break until about mid-June. What’s usually behind this? What causes this? James: Just as we were describing, Michael, if there’s any type of weather fears in Alabama, Mississippi, this year it was Texas, generally speaking, until the crop is planting and until the weather conditions look favorable for production that year, generally speaking that’s going to be the high point of the year as planting’s taking place in the southern states of the United States. As the planting is completed, it’s 85-95% completed, which will be proba

Good afternoon. This is James Cordier of OptionSellers.com with a market update for May 5th. Well, we are starting to receive some very interesting economic data just recently. Not so much here in the United States, but definitely in the EU. Both German and Great Britain numbers recently are really showing some signs of slowing. It’s very interesting that with quantitative easing still in place throughout the European Union we have slowing already in some of the main economies, namely Germany. Here in the United States we still do have a fairly robust recovery developing. While there are some economic numbers here showing that it’s not taking off to a great extent, it’s still on firm footing. This has created a much stronger U.S. Dollar just recently. Which has brought a lot of commodity prices back into check. Earlier this year, we were having fears of the U.S. Dollar falling in value and investors rushing into precious metals, gold, silver, platinum, and the like, and as the U.S. Dollar now becomes “King Dollar” once again gold prices and silver prices have backed off markedly. What’s so interesting is if quantitative easing is still in place throughout the European Union, how is that area slowing already? That certainly is a big point for us looking forward to help decide economic growth. Globally, in China of course we have tariff talk, not that tariffs are going to necessarily take place to a great extent but, what that often does is it creates anxiety amongst major players and I think that’s what’s going on in Europe right now. We do see decent demand for commodities going forward. The energy patch continues to be relatively strong but we do see that plateauing as well later in the summer. June, July, and August is often the high for demand in energy across the United States and we see that possibly slowing this big rally that we’ve seen in crude oil recently. We love the idea of putting a very large strangle around crude oil prices. We have a nearly fifty dollar strangle around that market. We think that’s going to be an excellent opportunity going forward and we have sales in precious metals some fifty, sixty, and seventy percent above current prices. With a strong dollar, we think that’s going to be an excellent way to go into the last half of 2018. We will just have to wait and see. We really like the way portfolios are positioned right now. We did a lot of rebalancing over the first quarter and a half and we think that we’re going to be bearing fruit here going forward over the next six months. Anyone wanting more information from OptionSellers.com can visit our website. If you’re not already a customer of ours and would like to become one, you can certainly visit our website or contact Rosemary about possibly becoming a client if you wish. As always, it’s a pleasure chatting with you and looking forward to doing so again in two weeks. Thank you.

Michael: Hello everybody. This is Michael Gross of OptionSellers.com. I’m here with head trader James Cordier. We are here for your monthly May video podcast from OptionSellers.com. James, welcome to the monthly show. James: Thank you, Michael. Can you believe we’re going into May already? Michael: It sure went fast. This last month here we saw some key developments in the markets. We have a lot of tensions between China and the U.S. over trade, and then we’re, lately, looking at 10-year treasuries going over 3%. A lot of people are wondering how this may affect commodities. What’s your take on that? James: Well, the trade wars that are supposedly about to take place, I think, are simply negotiation. President Trump mentioned many times going into the election that he was going to do “the art of the deal” and get us some more fair playing field, especially with China. Certainly the deficit that many goes out to China and doesn’t come back is something that he’s going to work on and, I believe, it’s more negotiating than it’s actually going to be major changes, as far as trade tariffs and such. Will some be put in place and some enacted? Probably so, but I know Mr. Mnuchin is going to China I believe in the next week or two, and he’s going to have probably the checkbook ready so he can basically get an olive branch going out. Needless to say, everybody wants a strong economic global growth and a trade war is not going to help that; however, getting a more fair and balanced trade, especially with China, I think is a really good idea and I think that’s what we’re going to get over the next month or two. All the discussion about it, I think, is going to be more of just that: just discussion. Michael: So, you don’t see any major changes in any commodities in the immediate term? Any immediate strategies people should be doing right now or as a result of that or, primarily, do you just see things leveling out here? James: Michael, the discussion of a trade war, like in soybeans or something that’s going to affect the demand for oil, I think a person or an investor should use that to look at the idea that it’s going to be settled. It’s not going to be a large disruption to production or demand in any of these commodities. When the price of a commodity is affected by discussion of it, I think you should take advantage of that. 3-6 months later, the fundamentals that we see now are going to be in place then, and basically it was hype that was going on and I think it’s going to offer opportunities. For markets that you’re following, if there’s trade discussion that’s going to move up or down the market that you were hoping to sell either puts or calls on, I think that’s going to be great picking in order to do that. Michael: Okay. Well, for those of you watching, we have an exciting show for you ahead this month. We’re going to be addressing a very common question we get. A lot of times, people sell an option, they get into the trade, the option moves a little bit against them, and then the question is “Well, what do I do now? Do I adjust the trade? Do I get out of it? If so, where do I get out of it?” What we’re going to do this month is we’re actually going to take you into some of our real trades we are doing in portfolios. Some of these, you’ve probably seen us talk about before. Pull back the curtain a little bit and show you a risk-parameter we might use and then recommend something you can use at home, as well, if you’re trading on your own or just get a little bit better insight into how we might do it professionally. A good analogy, and, James, I know you can comment on this, is we all saw the incident with Southwest Airlines this month where they had the problem with the engine. Certainly a tragedy for the people involved that it effected; however, one thing that really stuck out to me is the pilots that landed that plane and saved all those people. Have you heard the transcripts? They’re just cool as a cucumber. They knew exactly what to do, they had processes in place for every situation or condition, and you pilots out there that are clients, you know exactly what I’m talking about. When people are trading, and you know this more than anyone, James, you should have a contingency. Anything that happens, you should have a plan for that happening and have that type of control. That’s how you avoid that “what should I do” when you get into certain situations. When you’re trading, you deal with the same thing, James, am I right? James: I certainly do, nothing like that pilot was facing this past week, but in a similar note, you do have a plan. We are generally positioned in anywhere from 8-10 commodities and when one is causing the plane or the bow to veer right or veer left you simply need to make the adjustment. It shouldn’t be a huge deal to your portfolio. You should really be able to make a minor adjustment. If you’re in 10 commodities and 1 is going really in a direction you weren’t thinking, you should have a plan for that. It shouldn’t be a panic. It shouldn’t be large turns like this. You should just be turning the wheel like this and we’ve got an adjustment that needs to be made, the cocoa market or the coffee market or the silver market, and you just steer the plane and get it flying level again. Your portfolio, whether you’re having a portfolio with us or you’re investing with one on your own, you should never have a position that makes that much variance to your account. If you have 1 position in your account, name the commodity- it doesn’t really matter, and if it moves 5-10% in a short period of time, if that makes your account move larger than it really should be, it shouldn’t have a large variance because the market moved 5% or 10%. If it is doing that, you’re simply not positioned correctly. Always have in your portfolio 8-10 commodities and if 1 is making the plane go like this then you just pull it back like that. You should never have a position on your account that you can’t, in order to make the plane fly smoothly again, if you would. It happens all the time. We’re not right all the time. We’ll have 8-10 commodities in a portfolio and by-goodness, 1 is going to be causing this to happen and you just straighten the plane. Just like that brave pilot did, he knew exactly what to do. My goodness, 1 engine went out and he was able to do that. We have 10 engines on our plane. We should never have one commodity or another commodity make the plane go like this. It really shouldn’t happen. For your investors at home, if that’s happening to your portfolio you don’t have a diversified portfolio, and that is something that we at OptionSellers.com always strive to have so that when something happens that was unexpected, there’s a big headline in a certain commodity, you just straighten the plane and that’s what we do. Michael: That’s what we’re going to talk about today. If you’re trading at home or you’re checking out this strategy, one of the biggest advantages you have as an option seller is that flexibility James was talking about where if you’re trading, and say you are worried about a Chinese trade war or this or that, you have the ability to build out a strategy that can benefit from nearly any type of economic condition. It’s one you should use if you’re an option seller. We’re going to address and use a specific example this month from a market we talked about. We’ll show you how to adjust a trade if you do get into those type of situations where it’s not working exactly the way you hoped it would, and we’re going to give you a couple examples here of how to do just that. James, why don’t we move into the trading room and we’ll talk about our markets this month. James: Sounds good. Michael: Welcome to the markets segment of the OptionSellers.com May Podcast. We are going to talk about a market this month that we featured in last month’s podcast and that we’ve got a lot of questions on over the past month so we’re going to talk a little bit about it. This does go into the topic of this month’s podcast, which is how to turn a losing trade into a winning trade. So, first let’s talk about the market… this is the cocoa market. You saw us feature this market in last month’s podcast. Cocoa we talked about selling the 32 December call options. The markets rallied a little bit since then, did not threaten a strike, but it’s up a little bit. James, do you want to tell us what’s going on with this trade and this market? James: Michael, what’s going on with cocoa right now is the last several years we’ve had a production surplus worldwide. In 2018 and 2019, some of the largest cocoa analysis around the country is predicting the first deficit in quite some time for world production. Basically, high prices cure high prices and low prices cure low prices. The initial trade is that we’re going to have a production deficit this coming year and then the market must go much higher because we’re running out of cocoa, but in all actuality what happens when the price of something is rising that is dampening down demand. So, for example, when cocoa was trading around $2,000 and $2,100 a ton, chocolate manufacturers were purchasing cocoa. As it rallies, they purchase less and less and less, and the demand has already taken place. So, when we do get an announcement of a production deficit, that usually gets the last of the buyers, the headline traders, to get involved with the market. We saw a spike here recently in the last day or two where cocoa was threatening $2,900 a ton. Keep in mind that’s up almost 50% in price over the last few months. Basically what that does is commercial demand then starts to fall and then basically it’s a speculatively driven market. Usually a market that has moved 50%, we have just a couple percent difference in production, 2-3 years ago up until now, and yet we’ve had a 50% increase in price; thus, we think that’s a temporary move in the market. While we were suggesting sell

Good afternoon. This is James Cordier of OptionSellers.com with a market update for April 20th. Well, a lot in the news lately concerning tariffs and a possible trade war with the likes of China, of all countries, the second largest economy in the world. The Trump administration, I think, is basically playing a game of chicken and getting them to lower tariffs in their country and getting more of a fair trade platform. I think everyone is pretty much in favor of that. We’ve had a lot of questions recently… What would a trade tariff mean to some of the positions that we hold in commodities? Wouldn’t that be bearish for commodity prices? Good question. Over the last several weeks, there has been a lot of discussion about it and, primarily, soybeans are one of the target commodities that a lot of people are discussing. A tariff against soybeans and putting a premium on them would probably be negative to prices here in the United States and probably neutral to bullish in countries like Argentina and Brazil. Our commodities that we trade here, of course, are on U.S. exchanges. We are actually positioned for soybeans to fall later on this year, so a tariff against soybeans would actually probably help our position there, so we’re certainly not too overly concerned about that, but we do watch and wonder what implications might mean to the different commodities and we’re certainly abreast of that. Quite often, a lot of investors look around the country for different aspects of what can move the markets. Interestingly, right now is the incredible snow and rain in the northern parts of the United States right now. Generally speaking, that will be bullish for large prospect for corn and soybean harvests later this year. So, as we are hoping for a very large crop in soybeans, some October-November of this year, and lower prices, which would actually profit our accounts, our hats are off to those of you in the northern United States bearing the cold and the wind and the rain and the snow. That is helping all of our accounts later on this year. So, for those of us around the world and in the southern half of the United States, our hats are off to you. Thank you very much. We do anticipate that actually helping our accounts later on this year. That should be a nice addition to the strangles that we’ve applied recently in silver, some $13-$14 around the price of silver, practically 100% of the underlining price. In crude oil, we’re looking at strangles of $52 and $53 wide on barrels that are now worth $60. Basically, we’ve been reloading accounts after a really nice 2017. We’ve spent the last 90 days positioning in markets like that with what we think are going to be great opportunities that will certainly be bearing fruit later this year. We’ll just have to wait and see. Anyone wanting more information from OptionSellers.com can visit our website. If you’re not already a client and wish to become one, you can certainly contact Rosemary at our headquarters in Tampa, Florida about possibly becoming one. As always, it’s a pleasure chatting with you and look forward to doing so again in 2 weeks. Thank you.

Good afternoon. This is James Cordier of OptionSellers.com with a market update for March 30th. Well, when everyone first opened their account and we had a new account call, the two of us, three things were always discussed, and that is fundamental analysis that we do at our company. We are trying to analyze and discover commodities that are underpriced. Of course, in that case, what we would do is sell put premium. In cases of finding commodities that are overpriced, we are going to sell call premium, but the most important discovery of all is identifying markets that are fairly valued. That is truly our favorite positioning for adding premium and return to your account. Two weeks ago, we spoke about Goldilocks environment in commodity option selling and let me describe a little bit more what that is because we have identified and now have extremely high premium in three or four of those markets. Gold, for instance, we have a situation in gold that it will probably be well supported because of financial activity around the world. We have very good buying of several commodities both in Europe and in Asia and a strong economy here in the United States. That will likely keep gold supported. At the same time, of course, when gold made its big run to nearly 2,000 several years ago, that was based on the idea of quantitative easing creating a great deal of inflation. What we have right now is quantitative tightening. We have a very strong global economy, which should keep gold prices supported and we have quantitative tightening right now for interest rates and money around the world, which should definitely keep a cap on any large rally on gold. Imagine, if you will, in 2018 a $100 trading range for the gold market. That is what we see. We are also now looking at gold strangles that are $800 wide. There you are. Silver in 2018 having a $1.50-$2.00 trading range for the entire year and a $15 strangle around that market. Exactly. Crude oil. Fundamentals now are extremely supported because the United States is now exporting oil. At the same time, we’ll be producing 11-12 million barrels. That is also identifying a fairly valued market because the United States can now be the largest producer and, by quite some large number of barrels, oil should not run up to the 70’s or 80’s this year, we don’t think. At the same time, the fact that the United States is now exporting oil, we don’t have the bottleneck happening in the Houston area, which used to bring oil prices down. We see oil in approximately a $10 trading range throughout the rest of 2018. We have just identified a $50 strangle around crude oil. So, when we talk about identifying fairly valued markets, that’s what we’re referring to, and that, I think, is going to offer great premium collection in 2018 and should be a very good return at the end of this year. We’ll just have to wait and see. Anyone wanting more information from OptionSellers.com can visit our website. If you’re not already a client of ours and wish to become one, you can contact Rosemary at our headquarters in Tampa, FL about possibly becoming one. As always, it’s a pleasure chatting with you and looking forward to doing so again in two weeks. Thank you.

Michael: Hello everyone. This is Michael Gross of OptionSellers.com here with head trader James Cordier here for your April Option Sellers Video Podcast. Well, James, we didn’t see any abatement in the volatility in the stock market this month. In fact, Fed chairman Jerome Powell last week coming out, maybe spooking investors, talking about asset prices and maybe even financial markets being overvalued here… a little ghost of 2007. What do you think is going on here? James: Michael, it’s interesting... for the first time since quantitative easing was first announced practically a decade ago, investors and money managers now actually will have an option of not just pouring money into long stocks but fixed income is going to now be some of the talk. The tenure is approaching 3%. With what Jerome Powell said this past week, we will be reaching 3%, possibly 3.25 and 3.5 coming up over the next 6-12 months. With that in place, does the stock market have now still a free ride to the upside? Investors are going to be putting some of their money into fixed income and for the first time in practically a decade there’s an alternative from just being long the stock market. Michael: Obviously at this point, a lot of investors, especially high net-worth investors, are always looking to diversify into alternative asset classes. Physical commodities as hard assets always seem to have an appeal in any type of environment really but especially in this type where you have a lot of the jitters about paper assets. James: There’s probably more jitters now than I can think of over the last decade. As you know, we have investors contacting us on a daily basis, I think, just for that reason. Investors wanting to diversify right now from the stock market, I think, is hitting a really great stride right now. Wanting to get into markets that are uncorrelated to what the DOW does and what the S&P does is not only really popular right now but a lot of the real investors, you know, the people with millions of dollars under management, they are looking for alternatives now and I think they’re going to find some, not only in yield bearing accounts like fixed income but certainly in commodities like what we do, as well. Michael: Of course, we are in springtime now in the commodities markets. That means there’s a lot of things that happen in a lot of the physical commodities in the springtime, especially the agriculture markets and energy markets. We have some great seasonal tendencies, as well, in the spring. James: We do. Needless to say, a lot of people look at commodities and they think about the weather. Over the next 90 days the weather will be a really big factor. Quite often, end users for soybeans, corn, and wheat, they need to get insurance and make sure that they’re going to have these products for what they do and basically for animal feed. Of course in the United States, the largest producer of corn and soybeans, the weather is key. Often, they build in a certain premium during the months of May, June, and July just in case the farmers in the United States don’t do exactly what they would have hoped each year. Of course, later on in the year, once again the U.S. farmers are the best in the world and the spring rallies that often happen normally are just great sales for doing what we do. Michael: Speaking of those rallies or markets, we have a couple we’re going to feature this month that are maybe a little ahead of themselves. Now we have some of that inflated call premium. If you are one of those investors, it’s just learning how to sell options or learning how to sell options on commodities, these are two markets we think are really going to help you... Good opportunities, actually markets we are taking advantage of now in our management portfolios. We are going to cover those for you here in just a minute. Thank you. Michael: Okay everyone, we are back with our Market Segment for this month’s podcast. The first market we’re going to discuss this month is the soybean market. Soybeans have been in a strong rally the past couple of months primarily as a result of some things going on down in South America. James, do you want to talk a little bit about that and what’s driving prices right now? James: Michael, corn, soybeans, and wheat are all about the weather. The third largest producer in the world is Argentina. They’ve had a very dry growing season this year. For that reason, they do have reduced yields and we’re going to have a little bit of tightness out of that South American country. They are the third largest producer in the world and basically the U.S. weather is normally the big catalyst for the market moving up or down. This year, Argentina, which of course they have the opposite season here in the United States, their summers/our winter of course, and while there’s not much to talk about in the United States, traders look elsewhere. In South America, especially in Argentina, they had a really dry season. For that reason, the soybean prices have been bumping up to nearly 12-month highs over the last couple weeks. Michael: Yeah, we have seen some reduced yield expectations right now. We were at 60 million metric tons out of Argentina just a couple of years ago, now we are hearing it might be down as low as 40 million… it’s not reflected yet here. I guess that has been driving prices substantially higher, but we’re nearing the end of that growing season there now, aren’t we? James: We really are. Quite often, traders and investors will price on the worst-case scenario, so then once the corn and soybeans are actually harvested, often the weather wasn’t as bad as people thought and then the market readjusts to the current level of the production it actually turns out to be. Michael: So what you’re saying is although we’ve had some problems out of Argentina, they do about 50% of the production done in the U.S. or Brazil. From what I’m hearing, they’re thinking that production out of Brazil may make up some of those losses out of Argentina already. Is that correct? James: Unlike Argentina, just to the south of Brazil, Brazil has had just wonderful growing conditions for cocoa, coffee, soybeans, orange juice, sugar. Brazil is just a wonderful garden right now for growing soybeans. I think the Brazilian harvest will be larger than expected and that will make up probably a quarter and a half of what we’re going to be losing out of Argentina this year. Michael: Of course, as South American harvest is under way, we get started with planting here in the United States. The market probably starts focusing on what’s going on with the U.S. crop here pretty soon. If they do, the United States has some pretty big supplies heading into the planting season this year. James: We’re certainly going to have harvest pressure probably starting September-October of this year, and the Argentinean drought it probably going to be a forgone memory at that point. Supplies are going to be more than plentiful in the United States, and of course the U.S. is going to be the supplier to the world because of our ending stocks here in the United States, which is something I know we want to talk about as well. Michael: Starting off the year, we have the second highest ending stocks in the last 30 years and the highest in over a decade, so we’re already starting off the year with big supply. Now, the planting intentions, which we’ll know more for sure the 29th of March when that report comes out, but right now estimates are we’re going to have at least as many acres planted as last year, 90 million with estimates now at 90-92 million, so if we even have average yields we could be looking at all-time record ending stocks for next year. Like you said, that harvest pressure coming in… if they’re harvesting that size of a crop you’ll get some pretty substantial harvest pressure. So, the trade you’re recommending here right now, you’re thinking that this rally is probably going to fizzle and we’re going to see steadier lower prices. What are you looking at to trade here? James: Michael, we think that come October-November, soybean prices will probably be below $10 a bushel. We’re trading around $10.40-$10.50 right now. Basically, on the dry conditions in Argentina, we’re thinking that soybeans have a little bit of a chance to rally another 20-30 cents. They could get to the mid-upper dollar region. We love the idea of selling soybeans at the $13 level, so we’re going to be recommending soybean calls at $13 and $13.25 thinking that while soybeans might have a big of a rally going into May and June, we love the idea of being short in fall. So kind of like football, we’re not exactly throwing the ball to where we think the market is right now, but we’re selling options to where we think the runner’s going to be, and the runner being a huge harvest in the United States come September and October. $13 level for soybeans, you’ve got to bet on something, and boy we don’t see that happening nowhere being near that price. Michael: Yeah, that’s a pretty big cushion there to be wrong. The USDA itself has average on-farm price this year at $9.25, which is down here. So, that seems like a pretty safe bet. Let’s go ahead and move on to our next market right now, and that would be the cocoa market. Michael: James, cocoa is another one of these markets that has had a pretty good run here over the last several weeks. What’s going on here with prices? James: You know, similar to soybeans that we just talked about, one of the main producers of cocoa is the Ivory Coast. They are the largest producer in the world. They’ve had dry conditions this past year and, while those dry conditions certainly will reduce some of the pods yielding this year, we have what’s estimated to be 2% less cocoa being produced worldwide in 2018; however, a 2% drop in production has now caused and created a 30% increase in price. The balance doesn’t quite weigh out but we do have specul

Good afternoon, this is James Cordier of OptionSellers.com with a market update for March 16. Well, in reading the Wall Street Journal this past week, and maybe some of you have read the same article that I was reading, it was talking about the end of Goldilocks. They were referring to interest rates creeping up towards 3% on the 10 year. Basically, they’re forcing investors and money managers to consider some fixed income. Goldilocks, of course, was interest rates at basically 0. They’re only real investment idea was to go along with the stock market. And, of course, US stocks and stocks abroad have done extremely well over the last several years. And now, with the idea of fixed income becoming parts of certain portfolios, the stock market, while it still may climb in the coming year or two, will likely have to do it on its own accord – not just basically a free ride, which in case it probably has had them in the last year or two. Going forward, commodity option buyers love uncertainty. In our thoughts going forward, we do have a Goldilocks environment going forward for us. A vibrant US economy, a vibrant Asian economy, and of course the European economies are doing extremely well just recently. Along with rising interest rates, certainly not a rapid pace of raises, but probably a quarter here and a quarter there, that is Goldilocks for what we do here at OptionSellers.com. A lot of option buyers love uncertainty. We see certainty ahead in many fronts. We thank 2018 for some of that reason. It’s going to be quite good. We do have seasonal trades coming up in the next 30 to 60 days, one being soybeans. We love the idea of being short that market going forward. We are going to have an abundance of soybeans this fall, and we think using strength in that market over the next 4 to 8 weeks is going to be an excellent idea. We think that’s going to definitely help pads accounts in 2018. Anyone wanting more information about OptionSellers.com, can visit our website. If you’re not already a client of ours and would like to become one, you can contact Rosemary at our head quarters in Tampa, FL about possibly becoming one. As always, it’s a pleasure chatting with you, and I look forward to doing so again in 2 weeks. Thank you.

Good afternoon. This is James Cordier of OptionSellers.com with a market update for March 2nd. For those viewers today who have read The Complete Guide To Option Selling, possibly Chapter 10, which describes the credit spread, our favorite form of positioning accounts in short options and commodities, we describe it as the Maserati of all option positioning. Basically, the credit spread allows you to add premium to the account and have a safety measure of having one long position versus possibly three or four short sales. Basically, what the long position does is it babysits the position until later on the market decays. We normally buy back the position and then we offset our one long position getting some of the premium that we purchased it for back and put into the account. Basically, what this does is it smooths out the equity curve in times of high volatility. The high volatility sometimes scares people but what that does is it allows us to sell options much further out in time and much further out in price than we would normally be able to do. 2017 we did extremely well during the low volatility times but we were selling strikes quite close, and in 2018 and 2019 it looks like we’ll be able to sell options even further out of the money and with all the luxury of having a long position on to protect it. We started doing that this past week in gold, and silver, and crude oil, and we’re now looking to position the exact same way utilizing the rally that’s going on in the wheat market right now – something we really feel is going to be an attractive position later this year. We think that the credit spread is going to offer great returns in 2018. We’ll just have to wait and see. As always, it’s a pleasure chatting with you and looking forward to doing so again in two weeks. Thank you.

Michael: Hello everybody. This is Michael Gross of OptionSellers.com here with head trader James Cordier. We’re here with your March OptionSellers.com video podcast. James, as we head in to March here, what’s on everyone’s mind is the obviously the big development we had here in February. Big stock sell-off, it’s on everyone’s mind right now… stock investors are busy brushing themselves off, wondering what’s next. Over here in commodities, we didn’t really see a lot of movement in the markets themselves, but we had some developments in the option and option volatility. Why don’t we start off this month by maybe just talking a little bit about what happened in stocks themselves. James: Michael, it’s interesting, a couple of years ago we had BREXIT. We had Switzerland leaving the European Union, we also had the election outcome a year and a half ago. All these events didn’t really change fundamentals on a long-term basis, but what they did do is they injected a lot of volatility. The 3,000 point drop in the Dow Jones here just a couple weeks ago did exactly that. It turns out that there’s something called the volatility index in stocks. There was an instrument that was built for people to go short or long on it. It seems as though everyone was way short volatility. In the stock market, that got unwound, it developed a 3,000 point drop in the Dow Jones, and now we’ve got to the stock market recouping quite well. It’s probably going to continue to rally everything as far as we can tell. The U.S. economy looks good, the global economy looks good, stock profits look excellent right now. Volatility spiked in a dramatic way. For ourselves selling options on commodities, we saw volatility index spike as well. Precious metals, energies, and some of the foods did have a spike. In many cases, a lot of the positions we had did increase in value during this large increase in volatility. It’s not always fun when this happens, but it is absolutely a key ingredient in option selling. It allows us to sell options, as you know, 40-50% out-of-the-money. Without that creation that happens every 6-12 months in the volatility index in commodities and in stocks, we wouldn’t be able to do what we do. It’s a key ingredient and it did happen this past month. We’re very excited about the opportunities that it has now in selling options. Michael: It was kind of ironic, James, because you and I were watching this unfold, we were watching the stock market take a nose-dive, and we’re watching our commodities boards and basically nothing is going on. We have gold and silver prices staying silver, the grains and foods were business as usual, crude took a little bit of a sell-off, tied into stocks, but that was really the only one. Over in natural we had to sell off, but that was really already under way. It didn’t have much to do with stocks. Yet, you saw option volatility spill over from that stocks and it increased the value of those options temporarily, but now you’re seeing that come off a little bit. Is that right? James: It is. The volatility index in the stock market is practically to the same level as it was prior to the 3,000 point sell-off. In commodities, it has now come back about 75% of the level that it was at. The fundamentals never really changed at all, especially in commodities, and I think it sets up a great landscape for doing what we do. We’ll find out relatively soon. Michael: You know, a lot of people, they want to get diversified from stocks. That’s one reason why they’re interested in selling commodities options in the first place. You know, it was interesting… on CNBC they had an article about on the biggest day down in the Dow it was down, what…1,075 points or something like that? They ran an article that there was only 7 stocks higher that day and 2 of them were cereal and tobacco. It was Kellogg and one of the tobacco companies- I forget which one. CNBC’s analysis of that was, “well, even when stocks are down, people will still eat and they’ll still smoke”. That’s a point we make constantly is that no matter what’s going on, people still need to eat, they still need to drink coffee, and they still need to put gas in their tanks. James: The breakaway from the correlation from the stock market was very evident on that day. Gasoline and crude oil and soybeans and coffee… business as usual. That’s why a lot of our clients like being diversified away from the stock market. On that occasion, we did see the volatility index increase options on commodities, as well, and that’s just a key ingredient for us doing the business that we do. They did increase while we were in them. We just see, going forward, just a great opportunity to use that additional premium to position clients. Michael: So, we got a little bit of a surge in volatility, that pushed premiums up, and now that’s coming off. The premium is coming back down a little bit, but now we’ll have that historical volatility in the market. One thing you and I have talked about is now that opens up opportunities for us to do some strategies that maybe we weren’t able to do before. James: Right. In 2017, we saw volatility come down steadily the entire year, which really produced a great return for a lot of option sellers last year. Chapter 10 in the Third Edition of our book, we talk extensively about credit spreads. We haven’t had the opportunity to do that the last year or two because volatility has been low. The influx of volatility that happened over the last 30 days now allows us to do this. It is probably the most safe, sound option strategy there is. With the additional premium now, we’re looking forward to positioning in that fashion the next 6 months or so. Michael: Okay. One observation we were making as well is when volatility is up in options, obviously that’s when we want to sell them, but when the volatility is higher there can actually be less risk in selling the options because you’ve already had that surge in volatility. So, often times the path of least resistance is to come back off that volatility after you sold them. James: We saw that the months after the BREXIT, we saw that months after the Trump win during the election of 2016, and, boy, we did quite well right after that period. We expect that to happen again this year. We’ll see if that’s how it plays out. Michael: All right. As we head into March, we’re going to show you a couple ways maybe you can do just that. We’re going to move on to our feature markets segment and we will cover that in just a couple minutes. Thank you. Michael: All right. So, we’re back with our markets segment this month. The first market we’re going to talk about this month is the natural gas market, a market that’s near and dear to our hearts. Natural gas, if you’re unfamiliar with commodities, it’s a great market for selling options. There’s a ton of liquidity there and also you can sell options very far out-of-the-money, so it’s one of the core markets you want to focus on if you’re building an option selling portfolio. One of the first fundamentals that we look at when we look at markets like natural gas is going to be the seasonal tendency. As we know, seasonal tendency charts are not guaranteed by any means, but they do give you an average of what prices have tended to do in past years at different times of year. What we find is there are underlying fundamentals that tend to drive these every year. We’re going to take a look at the ones in natural gas right now. James, do you want to talk about that and why we see this type of movement in gas prices often in the past? James: It’s interesting, Michael. Often, suppliers want to bulk up for seasonal demand in winter, and everyone is basically building supplies going into December, January, and February. If the winter, especially in the Northeast, falls just a little bit shy of expectations or it’s 5 degrees cooler or warmer than normal, the supply actually is more than ample and prices usually start coming down in January and February as we see that we’re going to have enough natural gas and we’re not going to be running out. Again, here in the United States, we’ve had an extremely mild winter. Philadelphia, New York, and Boston, it has been some 10-15 degrees warmer this year than normal, and prices have come down just like seasonally they do. Supplies of natural gas this year are surprisingly low. Right now, we are approximately 23% below the supply of last year. We’re 19% below the 5-year average. That is because we’ve been exporting natural gas, something brand new to the exporting ability right now here in the United States. It’s setting up really nicely for the seasonal rally that we’re expecting. Natural gas right now is near it’s 12-month low here as we end February, often where it is this time of the year. Seasonally, what then happens is suppliers start building supplies then for summer cooling needs, which is like May, June, and July, and that often will give us a price spike starting in March and April. Michael: So, what you’re saying is this is really a factor of distributors accumulating that inventory, driving demand at that wholesale level, which is really what’s pulling prices higher… at least it has in the past. James: Exactly right. If we get through the winter, and it looks like we are again this year, prices usually come down because we are more than well supplied this time of the year. What wholesalers do for summer demand for cooling needs, especially in the Northeast, is they start building supplies and that demand boosts the prices starting in March, April, and May, and it’s setting up quite well to do that again this year. Michael: You know, it’s interesting, James, we talked about stock prices coming down earlier and a lot of people noticed a correlation and said, “oh, natural gas prices came down with stock.” That price really had nothing to do with that move in stocks. Natural gas prices were already coming down as a resu

Michael: Hello everyone. This is Michael Gross of OptionSellers.com. I’m here with head trader James Cordier. Welcome to your first OptionSellers.com Podcast of 2018. You’ll notice we are doing this in video format this year and we’re hoping we can use some video accompaniments to help you understand some of the concepts we’re talking about. We still will be doing some audios throughout the year, but we hope you’ll like the new format. Here we are in 2018. Stock markets are raging. Global economies are doing pretty well right now. So, we have a lot of global growth going on right now. We’re going to talk about, starting off, what that might mean for commodities. James, maybe you want to lead into that a little bit. What do you see for commodities going on this year? James: Michael, it’s interesting. Over the last several years, quantitative easing, here in the United States and across all of Europe, was thought to eventually make economies stronger. A lot of people were kind of not so hot on that idea, but certainly that has turned the corner. European economies are doing extremely well. China is bolstering once again. Here in the United States, along with some tax implications, the sky is the limit right now on economies worldwide. Of course, the stock market is doing great. Demand now for raw commodities look like it has finally turned the corner. There has always been too much supply. Needless to say, we had the Chinese economic boom of infrastructure spending several years ago. Basically, the market just came down from that and it has been waiting for real demand to finally develop and now we’re here. Copper prices, crude oil prices, some of the energies are making 2-3 year highs based on stronger economic growth throughout the globe right now. Chances for a weaker dollar look pretty special right now for 2018. All systems go right now for commodity prices, probably trending higher maybe throughout the year. Michael: Okay. So, you see this as, at least partially, a demand-led type strength possibly into commodities as a whole in possibly 2018. I know you’ve been talking recently about inflation creeping back in to the conversation here. Let’s talk a little bit about that. What role do you see that playing in 2018 and how might that affect commodities? James: Michael, 2% inflation has been the unachievable mark for several years now. Janet Yellen was trying to produce that. We’re finally there. A lot of some of the most brilliant people who do the bean counting for us for inflation are looking now at 2-½% inflation for 2018. The price of crude oil is such a dramatic input for different price costs throughout the world. A barrel of oil goes into grains and clothing and manufacturing. The price of crude oil has increased some 35-40% recently. That is going to start showing up in the inflation rate. We expect to see that probably the 1st and 2nd quarter of 2018, but investors are getting ahead of that right now. They’re not necessarily waiting for this 2.5, 2.75 inflation number to come out. They see it already and investors and traders want to get involved with it before the “white of their eyes”, they used to say. Michael: Okay. So, many of the people watching this show are interested in option selling or selling options on commodities. Obviously, inflation doesn’t necessarily mean every single commodity is going to be rising in price in 2018, the core fundamentals are really going to be the determinative of that, but it is a supportive factor and something to keep in mind. As an option seller, as somebody that sells commodity options, or you’re thinking about selling commodity options, how does inflation, the possibility of maybe the index as a whole being a little stronger, what affect does that have for commodities option sellers? James: Commodity option sellers can get into a market that has already taken off. For example, the price of oil was recently at 50 and it’s up at 65. A lot of investors are going to say, “Well, how do I get involved with oil? It has already made quite a move.” That’s the beauty of option selling. A person or an investor can still sell a $50 crude oil put just as though their break even was $50 where this bull market in oil started. That is one way an option seller can take advantage of a market that’s already moving… already left the station. With $50 oil right now, everyone would love to have that back. The writing was on the wall with OPEC production cuts… the more demand here in the United States and abroad. Basically, as an option seller, you can get in on that ground floor price that so many people missed out on. The price of gold recently has rallied $100. Do you want to buy gold here at $1,375 an ounce? Maybe, maybe not. We just rallied $100. By being involved with option selling, you can sell puts at the $1,100 mark, so you have nearly a $300 cushion for the market to do a variance. As the market goes higher, if in fact it does, option selling allows people to get in on what was the ground floor, but you get to wait to find out and see if it actually develops or not. The gold market has been trending higher, the crude oil market has been trending higher, a lot of the foods have, and some of these markets you can sell options 30-40% below the current price… A great way to still participate in inflation hedge for investors the rest of the year. Michael: Then you have the other side of the market, too, where often times when markets are rallying they get in the news crude. Perfect example. The general public wants to get in on it and what’s their favorite strategy? They want to buy the calls. So, all of a sudden demand for the calls goes up and people start rushing in and those premiums start going up, and there can be opportunities on both sides of the market. James: Exactly right. So often, the market will overshoot because of hedge funds that are pushing the market up. Then, of course, the public wants to get in and they don’t’ want to trade futures contracts so they want to buy call options. What that winds up doing is pushing call prices way about the fair value of where the market is likely going to reach. Basically, it sets up the perfect strangle, something that we’ve talked about often in our books and some of our material that our readers enjoy so much, I think. Michael: So, overall for 2018, what’s your take on commodities? Do you see this as a favorable environment for selling options? James: Michael, over the last 3 or 4 years, we’ve been involved with option selling on commodities without the volatility, without the public’s participation, without hedge funds participation, so the premiums on both the call and put sides have been slightly tight over the last 2-3 years. That’s about to change. We’re going to see inflated premiums on both sides. Explaining why put premiums inflated in a market heading higher is a little difficult for the laymen, but basically it is blowing up the volatility. It allows you to sell puts at a much greater value than normally you would, but the thing is, as the public comes into commodities, as investors come into commodities, often they want to be involved with the options, and often they want to be involved with the call options. So, while we do see an up market in oil this year and in gold and silver this year, the levels that the public and investors are willing to pay, we’d be happy to take the other side. We’re probably going to see options on commodities inflate to the tune of 30-40% this year, so not only are you picking levels that the market is likely not going to reach, but now we’re going to add just that much frosting to this cake as far as being able to sell options, I think. Michael: If any of you are interested in reading some of our research on some of the markets James is talking about, you’ll want to catch our upcoming edition of the Option Seller Newsletter. That will come out on February 1st. If you’re not already a subscriber, you can get a sample edition at OptionSellers.com/newsletter. James, we’re going to go ahead and move into our next section now and talk to you about some of the markets James is referring to right now and show you some strikes we are looking at. Michael: We are back with the markets segment of the podcast this month, and what we’re going to do is talk about a couple markets that you can follow at home. These are real markets we are looking at for our managed portfolios right now and we are going to talk about some things you can possibly do if you want to try some of these on your own or just maybe get an idea of how we do it when we’re looking at a possible trade. The first market we’re going to look at this month is the wheat market. This is really just a straight-ahead play here this month. It’s a bread and butter market. We’re looking at a market with clear cut fundamentals, discernable seasonal tendencies, we’re not looking for any big moves in the market, we’re just looking for the market to keep doing what it’s doing. Let’s take a look at the fundamentals first. When we look at it right now we are looking at World Wheat Ending Stocks. If you don’t know the importance of ending stocks or stocks to usage ratio in grains, I encourage you to go on our blog and look at our seminar on this… it is OptionSellers.com/agriculture. Ending stocks really measure the supply at the end of the crop year after all the demand has been taken out. It has a really big influence on price. 2017-2018 is expected to be an all-time high in World Wheat Ending Stocks. We’re also at a record level on stocks/usage ratio from a global basis. So, what this tells you is supplies for 2018 look to be very burdensome for wheat for the major part of the year, so that’s a key fundamental you need to keep in mind because what you want to look at is supply and demand and this is telling you that this is going to be weighing on the market all year long. James, you follow this quite a bit. What do you think

Good afternoon. This is James Cordier of OptionSellers.com with a market update for February 17th. Well, we look back and we see the Brexit about a year and a half ago. A little over a year ago, we had the surprise results in the U.S. election and now in 2018 in February we had a 3000-point move in the Dow Jones Industrial Average. And of course these three things all have in common is a great influx of volatility into the market. Basically, setting up very large premiums in both puts and calls in stocks and in commodities. While we’re positioned and looking at positions while the volatility index rises like that is not always the most fun, but we are looking at underlining futures prices in crude oil, and in silver, and in gold, and primarily they’re quite close to where they were as the stock market crash began. Of course now the stock market is coming back. It wouldn’t surprise us over the next two to three weeks to see them testing their recent highs yet again. And then we see the volatility index probably inching down. We do like the fact that volatility hit at the beginning of the year. It will likely come as we go into the second, third, and fourth quarter and at that point we should be able to make hay as the options then come back in and we position ourselves at this time. As so many clients refer to our cash position over the last six months, ‘why are we margined at twenty-five percent?’ Well, volatility was low and now you have your answer. We’re looking at putting premiums back into accounts. We’re looking at putting more margin facilities into use and we do like the idea of selling options now that volatility is extremely high. We’re looking at the second and third quarter of this year as likely decays in a lot of the options that we’re holding and look for new adventures such as natural gas. That market has traded absolutely perfectly seasonally the last eighteen months and we expect it to do the same thing again the remainder of the year. Anyone wanting more information from OptionSellers.com can visit our website. If you’re not already a client and wish to become one, you could contact Rosemary at our headquarters in Tampa, Florida about possibly becoming one. As always it’s great chatting with you and looking forward to doing so again in two weeks. Thank you.

Good afternoon. This is James Cordier of OptionSellers.com with a market update for January 13th. Well, each year at this time, early January, we’re often trying to analyze the landscape of the upcoming year and try to find out what nuances, possibly, will be shaping trading this coming year. We appear to be about to get a helping hand from something that’s been lacking from the commodities markets for several years. That is one word that has been talked about often on the business channels as well as the Wall Street Journal recently, and that’s inflation. Many money managers around the world want to participate in commodities but they really need a little bit of a push from time to time. 2018 looks like they’re going to get that. There are certainly some increases in certain commodity prices already this year. That has a lot of investors looking at the possibility for inflation and getting a hedge around themselves. Often, money managers want to buy precious metals, they want to buy energies and some of the foods, and that’s what has been lacking in commodities over the last 3-4 years. We think that in 2018 we are going to have those additional buyers and participants in the market. Often, that increases the value of options, both puts and calls, something we think will be very well taken advantage of by us this year. We do want to add 2 or 3 commodities to our book this year. We’re hoping for grains to be a larger content of our portfolios and, of course, in the soft markets like coffee and sugar, as well. We do see that happening. We’ll have to wait and see. We always want to be diversified as much as possible, but not just diversifying in order to only do that. We want to wait for opportunities. We think we’re going to get those additional opportunities in 2018. We’ll have to wait and see. We are very optimistic about the landscape going forward this year. We’re going to be trying to take advantage of those in the coming weeks and months, and we’ll see how we do. Anyone wanting more information from OptionSellers.com can visit our website. If you’re not already a client and wish to become one, you can contact our home office in Tampa, Florida and ask Rosie about becoming one. As always, it’s great chatting with you and looking forward to doing so again in 2 weeks. Thank you.

Good afternoon. This is James Cordier of OptionSellers.com with a market update for November 10th. Well, so often in the investment world, we’re all looking for the next best buy, or which stock is about to take off, or which piece of real estate has been overlooked and is probably going to be increasing in value. Option selling, especially on commodities, is probably the only investment around where you can identify fair value and actually predict a market to go sideways in price and to prosper from it. Quite often looking for the next big winner in the stock market or in a commodities market is what everyone is scrambling trying to do. In 2017, some of our best investments were identifying fair value markets. We in think in 2018 we probably have a similar list coming up and we’re starting to take positions accordingly. Precious metals have a lot of interest right now. We think that gold and silver are going to be very well supported throughout the remainder of 2017 and probably the beginning of 2018, as well. A lot of investors are trying to diversify away from the stock market and that does include being long some precious metals. Of course, the stock market is precariously high right now. That has some gold fever taking place, as well I’m sure – and of course, you have North Korea, you have Saudi Arabia, you have things going on in Asia – these are all nice supporting factors for the markets of gold, and silver, and platinum. What’s so interesting right now is the third leg required for the gold market, in our opinion, to have a sustained rally, and that would be inflation. And we simply don’t have any now. We don’t see any coming anytime in the near future. This is providing a very stable mark in the precious metals. The gold market we do see having a $100 trading range. We see gold right now trading at approximately $1300 an ounce. We do see it getting up into the high $1300’s – probably in the next six to twelve months. We also see it testing the downside somewhat. It might go down as low as $1200. But we do see this probably being a collar on this market and, you can use the same parameters for silver, as well. One of our very best investments in 2017 was predicting fair value markets. We had a couple. We had coffee. We had natural gas and, we certainly had precious metals. We are positioning with this in mind for 2018 and, we think 2018 is going to be a very good year based on these facts. We’re shorting precious metals, up some sixty to seventy percent from the current price and, we love going long from thirty percent below the going market value because we are slightly bullish on the market, as well. One fundamental factor that changed in 2017 and that was in the crude oil market. For the first time in decades the United States has been able to export as much crude oil as they want. So, instead of the market taking a tail spin in October, November, and December, this year, large exports left the United States. That, along with cuts from production from the OPEC nations has propelled the market to heights not seen in approximately three years. That did stop us out of some of our crude oil recently. We are going to change the parameters on crude oil. We think it’s still going to be kind of a sideways market over the next year or two but, we do have some of the definitive bearishness that takes place in winter each year, probably alleviating. So, the deep sell-off that takes place in the fourth quarter with now large exports leaving the United States, those might be a thing of the past. We’re going to be adjusting our parameters on the price of crude oil going forward. We now think that petroleum prices are likely also a fair value market – practically a widget if you will – especially with the United States about to produce ten million barrels a day. That will keep large spikes up in price from happening, as well. Anyone wanting more information from OptionSellers.com can visit our website. If you’re interested in becoming a client of ours, you can certainly contact our headquarters in Tampa, Florida and ask Rosie about becoming one. As always, it’s great chatting with you and looking forward to doing so again in two weeks. Thank you.

Michael: Hello everyone. This is Michael Gross at OptionSellers.com here with your podcast for October 27, 2017. Well, we marked the thirtieth anniversary of the stock market crash of 1987 this month. With stocks hitting new highs every day, a lot of investors are asking that same question – can it happen again. Some people say no, some people say yes but, an interesting prospect comes into play here with the news on tax reform. Will tax reform get passed? How will that affect the stock market? [I’m] here with James Cordier our head trader. James, welcome to the show. James: Thank you every much, Michael. Good afternoon to you. Michael: James, what’s your take on this. Everybody’s building up to tax reform – how it could affect stocks, if it does or doesn’t go through. Do you have a viewpoint on this right now? James: Michael, the discussion about tax reform is certainly extremely business-friendly. Practically all facets of the U.S. economy would likely benefit from this and of course bringing overseas dollars back to the United States, allowing companies to generate more income through investment as well as the one-percenters that sometimes sit on their hands when taxation is too high, a great number of these things could be alleviated if tax reform goes through. Certainly, I think, that’s what a lot of the bullishness is with the stock market right now. It’ll be very interesting to see the next thirty days how that plays out and then what the stock performance is after that. Michael: I saw this month that Goldman-Sachs projected there’s a sixty-five percent chance tax reform gets passed in 2018 but, there’s also some dire warnings what could happen to stocks if it doesn’t get passed. Do you think there’s a built in assumption right now in equities that this does go through and if it doesn’t, there’s going to be some disappointed bulls out there? James: I think so. Certainly, the stock market is forward thinking and they are looking at tax reform in the very near future, probably the first half of 2018 like you mentioned. There is no question that the stock market is at precarious levels. If it continues to get positive forward thinking, no reason why it can’t go up but, sooner or later, it’s going to get a dose of medicine that it may not tolerate and tax reform not passing would certainly be one of those possible culprits. Michael: Alright. Certainly something to watch over the next several months. Let’s hope we can get it done. Topic for this month’s podcast is two markets for year-end positioning and, we’re going to talk about a couple markets here that probably don’t care much about what happens in stocks. They’re completely uncorrelated. As we know from anybody that’s listened to us or read our materials we trade commodities primarily because that non-correlated aspect to stocks and each other. Primarily answering to their own supply-demand fundamentals. Out first market this month we’re going to talk about is the natural gas market. James, this is a market you’ve talked about here previously – the last month or two. But now we’re coming into the time of year where a lot of small speculators, people that aren’t real familiar with commodities often think of kind of that pop analysis, ‘boy, I should buy natural gas heading into winter because it’ll probably go up.’ A good article you wrote this month about that says maybe you want to do just the opposite. Do you want to talk about that a little bit? James: Michael, it’s interesting natural gas just has incredible historic volatility. With hurricanes that came into the Gulf of Mexico several years ago and then some extreme winters that we’ve had a few years ago as well, and that has brought investors looking at things like natural gas going into the winter season. The last few fourth quarters in the United States have been relatively mild. That is one of the reasons why natural gas is down this year going into winter heating season. It appears to us that natural gas supplies however, will be quite ample. We do often with the first cold blast in either November or December you do have speculators, both large and small, run into that market. The bottom line is this: Natural gas is now produced in so many not only nations around the world, but also states here in America. The idea that we could run out of a certain amount of the supply, one mishap or another as far as production, or if there’s a big spike in demand, natural gas can go to the moon, and right now that criteria has really been taken out of this market. We have a great deal of new drilling, especially in Texas. We have natural gas basically being produced as a by-product. So, we think natural gas in the low 3’s is probably fair valued for the market right now. We are going to be very keen to selling calls above the market on again if we do get a bit of spike here in November or December but, we’ve had positions laid out for several months already as high as $7 in natural gas. I know that seems quite high above the market right now and it certainly is however, we probably get one more push up in probably late November, early December, and at that point we could probably be looking at selling calls practically double the price of natural gas. So, we’ll be watching very closely for that when some cold temperatures finally come down from Canada here over the next thirty days, or so. Michael: Yeah, and talking about supply, the latest supply figures showing natural gas supplies in the U.S. at 3.595 trillion cubic feet. That’s near a historic high for this time of year. So that’s really backing up what you’re saying there as far as supply goes. But we have another dynamic in natural gas as well. I know another thing we look at, especially this time of year, is we have a seasonal tendency and, that seasonal tendency do tend to get a little spike in the fall at some time leading up to winter, as you mentioned, and then natural gas prices historically have tended to decline sharply after that. Can you explain a little bit for our listeners why that tends to happen? James: Generally, we were building supplies here in the United States just for that reason, for a potential frigid winter, especially in the northeastern United States. If the winter turns out to be anything other than a historic low temperature winter, we have more than enough supplies and of course, natural gas is used to be heating homes and businesses and fueling factories and such. But it never quite seems to be such a demand driven market in the winter as it normally would be possibly several years ago when natural gas supplies weren’t as high as they are right now. The market does seem to make a little bit of a pop to the up side in November/December but, it’s interesting if you look at a fifteen or twenty year seasonal pattern for natural gas, it actually falls into January and February only to bottom out then. So, I basically think that you have bullish investors trying to game the market a little bit before winter. If we have anything other than an extreme historic winter season prices do fall on expectations of the demand not being as high and then, we actually go down in January and February and that often then is the seasonal low for a rally going into spring. Michael: Very good. So, it’s a combination of fundamental high supply-side factors and we also have a seasonal tendency. And remember, if you’re listening, we’re not trying to predict prices going to be lower. We’re simply trying to predict where they’re not going to go. At this point, James feels that the pressure is going to be on the bulls this season and the highest odds trades are going to be selling those calls high above the market with expectations that prices could be lower but they don’t necessarily have to do that for call sellers to make money. If you’d like to learn more about the natural gas in this trade, you want to check the blog. We have a full-length article there and we talk about different potential trading opportunities there. That’s OptionSellers.com/blog. James, let’s move into our second market this month. That is the coffee market and, this is another market we’ve talked about recently but we’ve had a significant development there during the month of October. We had the event of coffee flowering, which takes place in Brazil – a big time of year for coffee. Do you want to talk about that and what’s going on down there? James: Michael, the most important seasonal factor to influence coffee prices over the entire year is the weather in Brazil in the months of October and November. We have a record number of coffee trees in the largest producing country of Brazil and, they are waiting for precipitation and that normally takes place in October and November. If, in fact, precipitation does develop during these two months, you have the largest number of trees ever on record waiting to produce cherries, which of course turn into coffee beans later on. What’s so interesting about October is that leading up to October weather patterns in Brazil are normally moving from west to east. A situation develops where it starts moving from south to north and during this transformation, it’s often dry in Brazil and people start getting excited about the fact that we might have a smaller crop next year. Precipitation, as we can see it right now, looks like it’s going to be right on course for October and November. We think that we’re going to probably be looking at the largest production ever coming out of Brazil next year but we will be keen to watch is for some periods of time, maybe a week to ten days, where it’s not raining in Brazil. That’s when you get investors, once again, speculating that it’s too dry there. It’s seems to make the news quite well because that is an important timeframe. So, we will be looking for rallies in coffee in October and November to take a short po

Michael: Hello, everyone. This is Michael Gross at OptionSellers.com. We are here with your monthly podcast for August 25th, 2017. I’m here with James Cordier. James, welcome to the show. James: Thank you, Michael. I’m always glad to be here and share our knowledge and wisdom. Michael: Excellent. Well, we are here in the last week of August and we are heading into Labor Day weekend and right around the corner is, of course, September. A lot of people come back from vacation, a lot of traders come back into the fold, and often times we find out where we really stand in a lot of markets that may have drifted one way or the other during the summer. Right now, as we look at stocks, kind of off a little bit. From the beginning of August we’re down, although up a little bit early in the week here at time of recording. We’ve had a little push downwards and, James, I know you addressed this in your bi-monthly address to clients on video, but do you want to talk a little bit about what might be going on right now in equities? James: Yes, Michael. The equities market, as everyone knows, has been hitting all-time highs throughout the first 6 months or so of the year; however, just recently, a bit of a speed bump with just absolute chaotic times right now in Washington D.C. A lot of the Trump ideas that helped get him elected, which propelled the stock market recently, are in question. Tax relief and de-regulation and 0% interest rates all might be influx right now, and, certainly, a lot of the reasons why people were buying stocks over the last several months were these very business-friendly ideas. I wouldn’t say that they’re gone and out for sure, but certainly they’ve taken a back seat to just simply getting Washington squared away. Hopefully these ideas will come back because they definitely are business friendly. While we’re not in the stock market, we certainly do root it on, because I’m sure a lot of our listeners and a lot of our clients do have stock holdings, so we’re always rooting for it. It has taken a little pause here for certain reasons, and a lot of them are some of the goings-on right now in Washington D.C. Hopefully it’ll get straightened out before too long. Michael: Yes, obviously this market is still in a bull market. There has been no bottom falling out and there may still be some reasons to buy the stock market. Just some interesting stats I saw was that as of earlier in the week here, on the whole year the S&P was up about 9%- not too bad, but certainly off the highs. Interesting note, James, the Russell was even on the year- no gain at all. James: Right. I noticed that, and a lot of the ideas of deregulation and, you know, lower taxation, that should be helping the small caps. The Russell being basically even on the year really does bring into the question is “How broad is this rally?” Certainly, the Dow Jones, basically we cherry-pick 30 stocks and the ones we like we put in there and the ones we don’t like we take out. Certainly, the Dow Jones has done extremely well, but some of the larger gauges of the stock market, like you said, are unchanged or up a percent for the year, and I think that was an eye opener to a lot of investors that saw that in the news here recently. I know it was to me, as well. Michael: Well, I’m just glad, James, that you and I don’t have to forecast the stock market because that’s certainly too many moving parts there for me. I know you feel the same way. James: Likewise. I really enjoy investing our client’s money and talking to our listeners today based on fundamentals of 10 commodities that have been around here forever and will likely be consumed for years and years to come. Michael: On that note, why don’t we talk about something we do know quite a bit about and that would be autumn seasonals, which is the topic of our podcast this month. We’re going to talk about a couple commodities here that we do study very closely and maybe do have some insights into. As far as talking about seasonals to begin with, if you’re a listener or have been listening to us for a long time or you read our book, you’re certainly aware of seasonal price tendencies in commodities. It is something that we follow very closely. They are not the buy-all and end-all of price forecasting, but they can certainly be a very big factor and something that can help you tremendously as an option seller. James, I know we were talking quite a bit about grain seasonals this summer and how they often sell off into the fall. Lo and behold, that seems to be exactly what happened across the board. James: Boy, it really is. Grain stockpiles around the world are at extremely ample levels. We did have quite a weather rally in the month of July and, Michael, it always seems to be too hot or too wet or too cold or something, then the market rallies. Come fall season, generally, some of the greatest producers of the world of grains are here in the United States and, lo and behold, we’re going to have quite a bit of a bumper crop in corn, wheat, and soybeans. When you add that to carry-overs from all the other production in the world, lo and behold, prices come back down to earth and they’re doing again this year. We’re not even through August yet and we’re making quite a push to seasonal lows here probably over the next 30 days. We have corn, wheat, and soybeans testing 12-month lows. It wasn’t that long ago, just a month ago, they were testing 12-month highs. Certainly, there’s a bit of a whipsaw action this year, like most years, and as we get into September and October we think prices will probably be quite heavy because of seasonal factors. Michael: Yeah, the seasonal tendency is not always perfect, as you and I know. At the same time, grains this year seem to follow it to a tee. They start declining oftentimes into harvest, the market starts anticipating that harvest, starts anticipating that excess supply coming on the market, and prices tend to start going. That’s exactly what they’ve done this year, especially now that we’re past the pivotal parts of potting and pollination in corn and soybeans. So, it’s just an example. If you’re listening at home and following grains, this is an example of what seasonals can do and how they can help. It’s not always perfect, but it certainly can help. That’s what we’re going to talk about now as we come into autumn. It’s a key time of year for a lot of commodity seasonals. The seasons are changing, there’s a lot of things going on fundamentally, and the first market we’re going to talk about of course, James, is one of your favorite markets, which is the crude oil market. This is the key time of year for crude oil, as well. Maybe you want to talk a little bit about the seasonal there and what tends to happen this time of year? James: You know, Michael, you mentioned something really interesting. The seasonals aren’t the end-all to commodity trading; however, it certainly is a tool that we enjoy using. It’s not spot on every year, but what we like to do, as you know, is we gauge the fundamentals going into a seasonal time frame. If they coincide with the seasonal factors, that is certainly something we like getting involved with. The energy market coming up again is one of these. As you know, Libya, Nigeria, and west Texas are producing some 20-30% above what they were expected to produce as far as reference to oil production. If you take west Texas, Libyan and Nigerian extra barrels that they are now producing in excess of what people were expecting, it is going to come extremely close to what the OPEC production cuts were. So, Michael, if you look at it that way, the production cuts that were creating quite a bull stare in the market this summer, that seems to be coming to an end based on the fact that production is going to equal out with the extra barrels coming from those other locations. Michael: The media really hit that hard and talked about the OPEC cuts and the bulls came out of the woodwork. It didn’t seem to have much of an effect, and now you’re saying that it may have no effect on supply whatsoever, being made up elsewhere. So, as we head into fall, we’ve already taken away one of those big bullish bullets, so to speak, is what they were hanging their hat on. If we look at a seasonal chart, which if you are getting the upcoming newsletter we do have this featured prominently in there, but James, we see crude oil going into the 5-year seasonal average here, and it tends to start falling pretty dramatically in September. Now, we talked about fundamentals and underlying fundamentals driving the seasonal, but what are the fundamentals that tend to happen this year that tend to cause that price decline? James: Michael, that’s a really good question, and a lot of our listeners and clients probably have the same question. It’s basically we are looking at a balanced to over-balanced oil market; however, in the months in June, July, and August, the United States, which is the largest consumer of energy in the world, heads out for driving. It is driving season and if you think that that’s just a saying, it truly does matter. When you have some 300 million people that have vacation ideas versus stay-home ideas, that makes an enormous difference to the consumption of gasoline in the United States. In July and the first half of August, the United States set all-time records for consumption of gasoline. That is what has propelled the market here for the last 4-8 weeks that got us out of the 40’s. It got us up to $50 a barrel in crude oil. However, the magic is, starting in September and then October, all those driving ideas and all those vacations are now pictures in albums, or should I say pictures in people’s Apple iPhones. People are sitting at home and they’re digging in for school and fall, and that makes a huge difference. We think that seasonal is setting up practically perfectly again this year. Michael: So, you’re somewhat bearish as we head i