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maxpain

July 26, 2011, 7:26 am
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max painmaximum pain

maxpain is calculated in 2 ways. The basic open interest method and the cash value method.

The open interest method is not correct, but it is quick and easy to calculate. Here, one simply looks at the combined open interest for both calls and puts. Then, the strike price with highest combine open interest is considered maxpain.

The cash value method is the correct method for determining maxpain.

Assume the stock will close at the first strike price. Determine the intrinsic value of each call option by finding the difference between the stock price and strike price. Remember that an out of the money option has zero intrinsic value. Determine the cash value of each call option by multiplying the intrinsic value by the open interest by 100 shares per contract. Add up all the call cash values to find the cash value of all call contracts at that stock price. Now do the same for put options, calculating intrinsic values, cash values and a total cash value. You now have the total call and put cash values for all options at that stock price.

Now assume the stock will close at the second strike price. Repeat your call and put option calculations to find the total cash values at that price.

Continue repeating for strike prices, assuming the stock price will close at the strike.

Finally, when you have the cash value for each strike price, simply look for the lowest amount. That is the maxpain cash value. The corresponding strike price is maxpain.
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Weekly Max Pain

July 27, 2011, 8:08 pm
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max painmaximum pain

Welcome to the Weekly Max Pain calculator. There are many monthly stock option max pain calculators. However, there are no weekly max pain calculators, until now.

Max Pain is the point at which options will expire with the least amount of money lost by the option writers. The theory is the market makers are the option writers while retail investors are the option buyers. Either market forces or the market maker will drive the stock price toward the point where most combined call and put stock options expire out of the money. Thus, reducing the cost to the option writer.

The "pain" is the pain to the option buyers, who lose option premiums when options expire out of the money.
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GOOG Weekly Max Pain

July 29, 2011, 9:36 pm
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Stock option data brought to you by the maximum pain website.

Here is the weekly max pain cash value graph for Apple stock. The ticker symbol is GOOG. For complete information, such the cash value graph, open interest graph, volume graph and all underlying stock option for GOOG stock this week, please visit the max pain website.
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AAPL Weekly Max Pain

July 29, 2011, 9:37 pm
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Stock option data brought to you by the maximum pain website.

Here is the weekly max pain cash value graph for Apple stock. The ticker symbol is AAPL. For complete information, such the cash value graph, open interest graph, volume graph and all underlying stock option for AAPL stock this week, please visit the max pain website.
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SPY Weekly Max Pain

March 9, 2012, 6:05 pm
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Stock option data brought to you by the maximum pain website.

Here is the weekly max pain cash value graph for the S&P 500 ETF stock. The ticker symbol is SPY. For complete information, such the cash value graph, open interest graph, volume graph and all underlying stock option for SPY stock this week, please visit the max pain website.
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QQQ Weekly Max Pain

March 9, 2012, 6:06 pm
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Stock option data brought to you by the maximum pain website.

Here is the weekly max pain cash value graph for Nasdaq ETF stock. The ticker symbol is QQQ. For complete information, such the cash value graph, open interest graph, volume graph and all underlying stock option for AAPL stock this week, please visit the max pain website.
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AAPL Pain

May 11, 2012, 8:58 am
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Apple is one of the best stocks for max pain because of the high interest from the public. Apple has a large, loyal, and sometime fanatical fan base. Many of these customers become retail investors in the stock. Beyond that, Apple is one of the best performing stocks. This leads other retail investors to participate in AAPL stock. Someone once famously quipped that everyone owns and talks about AAPL stock. Many of these investors dabble in the options, partially because of the high stock price. For example, a call spread is equivalent to owning the stock, but a fractional of the price. This leads to large open interest in the weekly and monthly options. The MM has to write more calls and puts, and therefore has to hedge with more common stock. The end result is the larger number of contracts has a exerts a greater pressure toward the max pain strike. In fact AAPL has been the poster child for max pain theorist as demonstrated by the articles below.
Here is the weekly max pain data http://www.maximum-pain.com. Or click the chart below.

 

aapl pain.

AAPL Pain
A site dedicated to open interest Max Pain theory and AAPL options sentiment. What is Max Pain? It is a theory which states on options expiry a stock will close

Aapl Pain 5-31-11 - YouTube
5-31-11. tlewi13 53 videos. Subscribe Alert icon Subscribed. Sign In or Sign Up now! Loading... Alert icon. You need

Max Pain Theory: Apple Options Should Be Sold, Not Bought
Jun 3, 2011 Max Pain Theory - Apple Options Should be sold and not bought

The maximum pain of Apple weekly options: One year later - Apple
Below: His chart of 52 weeks of Apple Max Pain. For his analysis of what happened last week, see here. Posted in: Apple, Chicago Board >

What Foxconn's blast did to Apple's Max Pain price - Apple 2.0
A case study in how the options market reacts to breaking news

Apple Max Pain Theory | AAPLTrader
Max Pain continues to rule Apple Stock. Learn how to profit from Max pain by watching this video.

Max Pain happening tmrw | The Mac Observer Forums
apple max pain theory. which talks about trading around the max pain theory, very interesting.

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Max Pain

June 14, 2012, 1:52 pm
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Max Pain is the theory that hedging activity by the Market Marker drives the stock price toward a specific point on the option maturity date. The market maker must sell the options to the buyers. At the same time, he will hedge to remain neutral by establishing a position in the common stock. As the option maturity approaches, the MM must rebalance to remain neutral and this drives the price toward max pain. Why does max pain work so well with AAPL stock? AAPL seems to have more weekly and monthly option open interest. Few stocks come close to the option volume of AAPL. This means the MM has sold more options, and therefore must establish a larger position as a hedge. The more options involved, the more stock, and the greater force behind max pain.
Here is the weekly max pain data http://www.maximum-pain.com. Or click the chart below.

 

max pain.

OptionCalc (Max Pain& Current Pain Calculator)
In the option market, wealth transfer between option buyers and sellers is a zero-sum game. On option expiration days, the

maxpain.info [Max Pain Calculator]
Symbol, Last, Target, Diff. ROST, 47.0000, 87.5000, 40.5000. SHLD, 46.1600, 72.5000, 26.3400. SINA, 55.0500, 80.0000, 24.9500. AIXG, 11.7100, 36.0000 ...

Max Pain Calculator, Historical Option Trends, & Historical Data ...
2 days ago ... Calculate the maximum pain strike price & Graham value for nearly any stock symbol. Research historical option prices to identify trends.

Option Pain Calculator
Option Pain. Contact Us. Current Pain. Knowledge Center. Option Jumps. Announcement We introduce new, powerful Current Pain Chart. my account ...

Max Pain Options
We'll show you how to use the max pain theory to make money trading options. This is an easy, conservative strategy for making money from the concept of

Euro Shorts Cover Modestly Following Max Pain; Dollar Bullish Bets ...
As expected, following the maximum pain rip in the EURUSD late last week, which took the pair from 1.38 to just under 1.4250, all the weak

Apple closes at or near Max Pain 8 weeks out of 10 - Apple 2.0
New evidence suggests that since last summer the tail has been wagging the dog

Max Pain Definition | Investopedia
Max Pain - Definition of Max Pain on Investopedia - The point at which options expire worthless. The term, max pain, stems from the Maximum Pain theory, which

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AMZN Max Pain

July 3, 2012, 8:26 am
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The maximum-pain.com website shows the weekly and monthly max pain cash values for any stock, including AMZN. If you want to know the AMZN max pain for this week, click the link above or click on the graph below. Keep in mind that max pain changes with the option open interest. Existing options may close while new option contracts are opened. This means you will need to check back frequently to determine if max pain has changed.

 

max pain.
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Max Pain Definition Video

October 6, 2013, 9:11 pm
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Do you want to know what max pain is? Would you like to learn how max pain predicts the future price of a stock? Please watch the video. In less than 4 minutes the video explains how max pain can be used to predict the stock price. Is it magic? No, it based on the fact that a market maker who wrote option contracts created hedge position in the stock to remain neutral. As expiration approaches, the hedge must be adjusted. This adjustment, or rebalancing provides pressure on the stock ptice.

For more information, please watch the video or visit maximum-pain.com.

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Max Payne

January 5, 2014, 5:31 am
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AAPL max pain
Search engines seem to be confused.  A search for "max pain" yields results that are mostly for "max payne".  This blog is dedicated to the former.  The stock option max pain theory that says you can forecast the stock price on a maturity date by looking at the strike price where option buyers will loose the most money.  Maximum pain as name for the theory is perhaps melodramatic, but meant to describe the loses incurred by the option buyers.

So what (or who) is Max Payne?

Max Payne is a fictional title character of a video game.  The game by Remedy Entertainment uses the name as a play on words.  It is a not so clever attempt to underscore the violence of the video game.  The game itself was a hit and spawned at least one sequel.  The game introduced bullet time prior to the Matrix.  It was also praised for its graphics and distinct neo-noir feel.  The games also incorporates many names from Norse mythology which is fitting since the company is in Finland.

The video game was also made into a movie.  Mark Wahlberg played the lead character, a New York police detective.  In the movie he is out to bust makers of a new drug that killed his family.  This is a rather overused plot and was poor written.  Mark Wahlberg is mostly deadpan in his performance, and not offering any chance for audience empathy.  Perhaps the most unusual feature is the valkyries.  In true Norse mythology these beings selected the valiant warriors from the dead on a battlefield to live in Valhalla in Asgard, awaiting a final battle at the end of the world.  In this respect they were angelic beings.  In the film, they seem to be darker, menacing and in some ways demonic.

The game and film become associated with stock options only because of the similar sounding names.  The search engines make no distinction between the two.  A max pain search result yields a mix of both.  The search engines assume the user has mis-typed the Max Payne name and returns data accordingly.  What perhaps is most disturbing is that more results seem to be for the game or film than the stock market.  One might think that stock option trading is the more relevant and important topic, especially when spelled correctly in the search.
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VIX Max Pain

March 24, 2014, 5:54 am
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The VIX max pain data is from http://www.maximum-pain.com. Or click the chart below.

 

VIX (CBOE Volatility Index) Definition
The ticker symbol for the Chicago Board Options Exchange (CBOE) Volatility Index, which shows the market's expectation of 30-day volatility. It is constructed ...
VIX Index Quote - CBOE Volatility Index Index Price Today
VIX Stock Quote, and financial news from the leading provider and award-winning MarketWatch.com.
CBOE - CBOE Volatility Index (VIX) Options and Futures Micro Site
Introduction to VIX Options and Futures - The CBOE Volatility Index (VIX) is a key measure of market expectations of near-term volatility ...
VIX:IND - Bloomberg
Index performance for Chicago Board Options Exchange Spx Volatility Index (VIX) including value, chart, profile & other market data.
CBOE Volatility Index - .VIX - Stock Quotes - CNBC.com
CBOE Volatility Index, .VIX real time stock quotes, news, videos at CNBC.com.
VIX - CBOE MKT VOLATILITY IDX Stock quote
CBOE MKT VOLATILITY IDX. (Market Data Express:VIX). Add to Watch List. Set Alert. 15.00. Data as of Mar 21. +0.48 / +3.31%. Today's Change. 12.
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AAPL Weekly Max Pain

July 1, 2011, 8:43 pm
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Stock option data brought to you by the maximum pain website.

Here is the weekly max pain cash value graph for Apple stock. The ticker symbol is AAPL. For complete information, such the cash value graph, open interest graph, volume graph and all underlying stock option for AAPL stock this week, please visit the max pain website.
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Weekly Max Pain

July 1, 2011, 8:48 pm
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max painmaximum pain

Welcome to the Weekly Max Pain calculator. There are many monthly stock option max pain calculators. However, there are no weekly max pain calculators, until now.

Max Pain is the point at which options will expire with the least amount of money lost by the option writers. The theory is the market makers are the option writers while retail investors are the option buyers. Either market forces or the market maker will drive the stock price toward the point where most combined call and put stock options expire out of the money. Thus, reducing the cost to the option writer.

The "pain" is the pain to the option buyers, who lose option premiums when options expire out of the money.
↧

GOOG Weekly Max Pain

November 1, 2011, 8:41 pm
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0
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Stock option data brought to you by the maximum pain website.

Here is the weekly max pain cash value graph for Apple stock. The ticker symbol is GOOG. For complete information, such the cash value graph, open interest graph, volume graph and all underlying stock option for GOOG stock this week, please visit the max pain website.
↧
Search

SPY Weekly Max Pain

March 1, 2012, 8:35 pm
$
0
0


Stock option data brought to you by the maximum pain website.

Here is the weekly max pain cash value graph for the S&P 500 ETF stock. The ticker symbol is SPY. For complete information, such the cash value graph, open interest graph, volume graph and all underlying stock option for SPY stock this week, please visit the max pain website.
↧

QQQ Weekly Max Pain

March 1, 2012, 8:50 pm
$
0
0


Stock option data brought to you by the maximum pain website.

Here is the weekly max pain cash value graph for Nasdaq ETF stock. The ticker symbol is QQQ. For complete information, such the cash value graph, open interest graph, volume graph and all underlying stock option for AAPL stock this week, please visit the max pain website.
↧
↧

AAPL Pain

May 1, 2012, 8:54 pm
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0
0
Apple is one of the best stocks for max pain because of the high interest from the public. Apple has a large, loyal, and sometime fanatical fan base. Many of these customers become retail investors in the stock. Beyond that, Apple is one of the best performing stocks. This leads other retail investors to participate in AAPL stock. Someone once famously quipped that everyone owns and talks about AAPL stock. Many of these investors dabble in the options, partially because of the high stock price. For example, a call spread is equivalent to owning the stock, but a fractional of the price. This leads to large open interest in the weekly and monthly options. The MM has to write more calls and puts, and therefore has to hedge with more common stock. The end result is the larger number of contracts has a exerts a greater pressure toward the max pain strike. In fact AAPL has been the poster child for max pain theorist as demonstrated by the articles below.

Here is the weekly max pain data http://www.maximum-pain.com. Or click the chart below.

 


aapl pain.

AAPL Pain
A site dedicated to open interest Max Pain theory and AAPL options sentiment. What is Max Pain? It is a theory which states on options expiry a stock will close

Aapl Pain 5-31-11 - YouTube
5-31-11. tlewi13 53 videos. Subscribe Alert icon Subscribed. Sign In or Sign Up now! Loading... Alert icon. You need

Max Pain Theory: Apple Options Should Be Sold, Not Bought
Jun 3, 2011 Max Pain Theory - Apple Options Should be sold and not bought

The maximum pain of Apple weekly options: One year later - Apple
Below: His chart of 52 weeks of Apple Max Pain. For his analysis of what happened last week, see here. Posted in: Apple, Chicago Board >

What Foxconn's blast did to Apple's Max Pain price - Apple 2.0
A case study in how the options market reacts to breaking news

Apple Max Pain Theory | AAPLTrader
Max Pain continues to rule Apple Stock. Learn how to profit from Max pain by watching this video.

Max Pain happening tmrw | The Mac Observer Forums
apple max pain theory. which talks about trading around the max pain theory, very interesting.

↧

VIX Max Pain

March 1, 2014, 9:06 pm
$
0
0
The VIX max pain data is from http://www.maximum-pain.com. Or click the chart below.

 

VIX (CBOE Volatility Index) Definition
The ticker symbol for the Chicago Board Options Exchange (CBOE) Volatility Index, which shows the market's expectation of 30-day volatility. It is constructed ...
VIX Index Quote - CBOE Volatility Index Index Price Today
VIX Stock Quote, and financial news from the leading provider and award-winning MarketWatch.com.
CBOE - CBOE Volatility Index (VIX) Options and Futures Micro Site
Introduction to VIX Options and Futures - The CBOE Volatility Index (VIX) is a key measure of market expectations of near-term volatility ...
VIX:IND - Bloomberg
Index performance for Chicago Board Options Exchange Spx Volatility Index (VIX) including value, chart, profile & other market data.
CBOE Volatility Index - .VIX - Stock Quotes - CNBC.com
CBOE Volatility Index, .VIX real time stock quotes, news, videos at CNBC.com.
VIX - CBOE MKT VOLATILITY IDX Stock quote
CBOE MKT VOLATILITY IDX. (Market Data Express:VIX). Add to Watch List. Set Alert. 15.00. Data as of Mar 21. +0.48 / +3.31%. Today's Change. 12.
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Max pain and Stocks with high Option Open Interest

July 1, 2014, 9:03 pm
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Max pain theory states that the market maker is forced into a position on stock XYZ because he has to sell/ write the call options that are bought.  The market maker buys the stock to cover and offset the obligation he took selling calls.  This  covered position or hedge must be maintained and re-balanced heading into option expiration.  This activity drives the stock to close at max pain.  Of course, the MM may be writing put options as well.  But there are always more call options bought than put options.

If there is only a few options for stock XYZ, there is a small open interest.  The hedge position is also small and the act of re-balancing it does not affect the stock price very much.

On other hand, if there are a large number of open contracts and a large open interest then the hedge will be large.  A larger hedge means more shares traded.  More stock bought or sold means more pressure to close at max pain.

The conclusion is that max pain works best for stocks that trade a large number of options.  The more option open interest there is, the more likely max pain is.

The question then becomes which stocks have the largest amount of option open interest?  Say we were to ask how many stocks have more than 50,000 call open interest at any point in time?

AAPL routinely has more than 50,000 call options open.  This was true before the 7:1 split.  Since the 7:1 split it stays well above the 50,000 contracts.

YHOO has traded with just over 50,000 open calls for the June 27 expiration in the week prior.  The BIDU IPO is likely the reason behind the activity.

BAC had 60,000+ open calls for the week heading into June 27 maturity. Also, it appeared to be over 50,000 for the week of July 3rd expiration

CBS had near 90,000 open calls for 6/27 and near at least 70,000 for 7/3

MU also had 80,000+ open calls for the week of 6/27.
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