From the fou tour. Two owe posing ways to play the semisector and how to keep digging when at the end of a mine its time to risk less to make more options action starts now. As we just mentioned. Interest in options trading seems to keep growing by the day. So bob has at least part of the reason why good to see you options trading has become the new Sports Betting millions staying at home have discovered Sports Betting and it has created options trading. Trading in equity options hit new highs in november continuing a trend that began earlier in the year equity options trading is 50 above last years level yeartodate on all of the options platforms. Much of the activity has occurred in out of the money call options with much of it in day trading. Buying in the morning and getting out in the afternoon analysts say that might make some sense if you only have a limited amount of money to invest, buying options at 1 or 2 may make more sense than buying a tesla or amazon or apple if the stock moves 5 , the value may also move a similar percent so you can make the same percentage with much less outlay of capital what could go wrong . The markets have been in an up trend. If that reverses, this type of trading will not be profitable and there is considerable speculation that this kind of day trading may have a limited shelf life many doing this now are younger and may have to start paying back Student Loans soon. When the pandemic is over, many of those staying at home will likely go back to work so many out there participating in the parkts. Markets it also seems dangerous. What are the thoughts on the surge we are seeing . We actually talked about some of this type of flow earlier when we saw this earnings disappointment there was a lot of activity when people were buying after the stock fell a lot of people made multiples of their money within a day. But you could potentially lose everything you are betting if you are making those short directional bets and as bob was pointing out, when you are going to work, you are usually not day trading from your desk. You can do that from there people are becoming smart about options investing. Ultimately i think volumes will stay more elevated now that there are more market participants. We have seen trends that were in place prior to the pandemic stay there during the pandemic we have already seen an explosion in interest in the Options Market tony oh, sorry this is similar to sportsbook. If you look at the way i think we are having problems with tony are fairly is really far out of the money call options are can you hear me yeah, we have got you sorry so these are more like lottery tickets than binary events which most sports betters are used to. The call options are unsis tan lk in the long run if people are looking to build a portfolio, i recommend they watch options action there are more binary type outcomes words of advice to the new byes its all about one day, in and out. Do it the options action way hedges, what better place to start. Carter, set us up with this the thinking is a little too hot, too crowded, too popular. Look at the first chart. Three comparative lines. You are looking at the stocks index. Basically threefold increase. What about the next chart . The steady or uptrend. You can see the trendline. We are pretty far above trend. Next chart in a channel. We are at the top of the channel. It doesnt mean we have to crash. It just means if you are in short. And the final chart. This isnt a oneyear chart. What you can see is a pin bawl we have been within the range. Extended measures. What do you make of this . Since the election we have seen this sector outperform the broad sector if we look where a lot of that performance has come from, it has come from multiple expansion. We have seen it outperform the Broader Market significantly granted, i think there are secular tail winds we have 5g, gaming and even working from home are good reasons why some of these companies will be doing better but it does feel extended to me. You can take advantage of the fact that implied volatility has come in. If you are looking to hedge or take a risk mitigated bearish position, looking at february, about 2. 5 of the current level of smh you may look at those and say that is some bit out of the money. By just trading a single put option we have the opportunity to potentially spread or roll or Something Like that. So we give ourselves flexibility and giving ourselves time for this to play out what if one is still looking for a way to get in on the semisurge. Tony has a name to look out for with report earnings next week i want to look at broad com if you look at the growth itself in 2020 they are expected to generate about 11 billion projected growth for all of the reasons, i think it is trading at a very reasonable 18 times forward earnings so i think a reasonable valuation and dividend yield is one of the strongest within the semiconductor space. While i agree with carter, i am not concerned about broadcom and i think next week they will report solid earnings. If you look at the chart, you have a steady uptrend for the last eight or nine months. I think the earnings Catalyst Next week is potentially what it could need to catch up if you look at the Earnings Announcement so far, the Options Market are implying about 5. 8 move while over the last 8 quarters the stock has only moved about 4. 2 so the stock doesnt move a lot on earnings so the trade structure is taking advantage of the volatility for broadcom are fairly elevated so i am going to january and selling the put spread collecting about 20. 70 to share the january 410s netnet i am collecting about 9 which is about 45 of the width. So a fair amount for the risk taking what do you make of the trade . Comparing this to some of the activity bob was talking about at the beginning of the show, day traders hoping stocks will move up in a short amount of time this will profit if it goes up if it goes up quickly, it will do more. And it is less than if you purchased it at the current strike price while we talked about smh, that isnt the same as broadcom carter . Yeartodate, semiwas up 52 avgo was up 50 versus 130 semis have killed them so it is a longterm setup for a semi thats so old school, carter to call it avgo. Broadcom we are more than a weekly tv show go to our website optionsaction. Com. Here is what is coming up next. Grab your magnifying glass. Thats a hat, by the way professor Sherlock Holme is investigating a volatility mystery. You see but do not observe plus, reach into your pocket, get your phone andwe tet us your question if its nice we will answer it on air when options action returns. Welcome back to fast money. Just a few minutes ago we talked about the explosion. Copper and gold are all going wild if you are looking to protect your portfolio against an uncertain backdrop but arent quite sure how, you are in luck. The professor is here. Mike, take it away it was interesting. I was taking a look at the indices we look at it is poised to drop below 20 before we get to christmas but if you look at the longer term vix futures, you will see they still remain elevated you may wonder by the time five or six months rolls by, we will be past the inauguration its possible if we are looking at the situation, we may be looking more macroand dealing with the krur rather thcure rate symptoms themselves. Thats what we do when we see volatility as in gld when you see spikes in things like oil and natural gas, gold, silver, things like this, oftentimes thats accompanied by elevated volatility. So that could be potentially bullish. What is the opposite of that the u. S. Dollar. When you think about everything being done to essentially deal with the situation we are in, a lot of that is potentially bearish for the dollar you may remember that carter and i outlined a bearish trade and some of you may be wonder now that we have seen it decline, if we are unwinding i am not inclined to. I am looking out to june thats the way to put a bearish bet on the dollar. Keep in mind what is going on with our economy, depress the dollar is going on in other economies, you may not see quite the move you would expect if you see upticks in things like inflation. But i think the things we are doing to support the economy both on a monetary and fiscal basis are bearish for the dollar vix is on track for its worst performance since 2017 carter, do you see downside ahead . Sure. The reason of putting that trade on and walking through the dollar charts a week or so ago is the critical juncture on the index. This is hard to stop and i think ultimately we get down to the value of the dollar we saw in 2014 tony, what do you think of mikes trade there are many ways to play a weak dollar, not just a rise in commodities. Just a comment on the trade itself if you placed that first trade, this is a great example of how you can roll some of the profits from that first put and put it out to june. And the fact that carter said we broke 92 on the vix, i think we are headed down to 23. 50 but if other currencies also devalue their currency, you may not see the dollar decline as much one of the things we have done on options action we have a long trades as in eem. I agree you shouldnt have all of your eggs in one basket, but look at long gold and others just to comment on vix, i think the reason you have spot vix so low is because in the short run there is a lot of optimism with vaccine two weeks away, a peaceful transfer of power into the new year when you look three to six months out equity markets i think are priced to perfection there are concerns whether Consumer Spending will continue at the same rates, everything from delinquency rates on loans and whether or not everything will go as smoothly as he would think. If you go more than three or six months out, you are seeing more devaluation. Most vicx equity declines ar coming from the market i think we will see a better window going into the new year than lately when we have had better support than when we have deferrals on payments. Up next, digging for gains what rocks to look under and send us your tweets. We will answer some of them on air. We will be back after this its a thirteenhour flight, thats not a weekend trip. Fifteen minutes until we board. Oh yeah, we gotta take off. You downloaded the Td Ameritrade mobile app so you can quickly check the markets . Yeah, actually im taking one last look at my dashboard before we board. Excellent. And you have thinkorswim mobile so i can finish analyzing the risk on this position. You two are all set. Have a great flight. Thanks. Well see ya. Ah, theyre getting so smart. Choose the app that fits your investing style. The teams been working around the clock. Wire, weve had to rethink our whole approach. Were going to give togetherness. Logistically, its been a nightmare. Im not sure its going to work. Itll work. I didnt know you were listening. Its got all my favorite shows turn oright there. Boom, i wish my Trading Platform worked like that. Well have you tried thinkorswim . This is totally customizable, so you focus only on what you want. Okay, its got screeners and watchlists. And you can even see how your predictions might affect the value of the stocks youre interested in. Now this is what im talking about. Yeah, itll free up more time for your. Uh, true crime shows . British baking competitions. Hm. Didnt peg you for a crumpet guy. Focus on what matters to you with thinkorswim. Welcome back to options action. A few weeks back tony took a shine to gold trading. It declined and it is just on a verge of a massive breakout. So from my perspective i see a target of 24. I am buying the 20 call vertical spending about 2 call options and collecting about. 75. That trade turned out to be solid gold jumping into the green this expires in february what are you doing to it my price target was 24 about 60 to 90 days out. We have exceeded that. When you have a trade like this where you have exceeded the upper strength, you have two options. You could take the profits and run. We are up about 120 on this trade and there is nothing wrong with taking profits and being comfortable with that. But you can also turn what is a small winner into a much larger winner by rolling it up. Because i have so much time left here, i was looking at february 25, by rolling it up to the february 2028, i can still take the credit if you were simply looking at trend analysis, how far above, whatever moving average you want to choose, in my case the 150, freeport has only in its history been this far above its 150year average. Just about this point is where it gave back a good 20, 25 . Up next, we have your tweets and final call im searching for info on options trading, and look, it feels like im just wasting time. Thats why Td Ameritrade designed a firstofitskind, personalized education center. Oh. Their awardwinning content is tailored to fit your investing goals and interests. And it learns with you, so as you become smarter, so do its recommendations. So its like my streaming service. Well except now youre binge learning. See how you can become a smarter investor with a personalized education from Td Ameritrade. Visit tdameritrade. Com learn but before we sign i gotta ask. Sure, anything. We searched you online and maybe you can explain this . I cant believe that garbage is still coming in. That is so false frustrated with your Online Search results . Call reputation defender today to join tens of thousands whove improved their online reputation. Get your free reputation report card at reputationdefender. Com or call 18778668555. Its time for the final call carter stock market is up 15 . Too far, too fast, sell them tony . Selling in january at 4. 10, 3. 90 put spread. Mike . Hedge your semiexposure with a spread unfortunately, i dont think the i promise to help you find a bull market some where, mad money starts right now. Hey, i am cramer. Welcome to mad money, welcome the cramer america my job is not to entertain you but to educate and teach you, call me at 1800743cnbc or tweet me jim cramer not enough