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In this video, I wanted to quickly go over a little intro on weekly options. Most people don't know what weekly options are, so if you're new to trading or you’ve heard the term, this video will help give you an idea of what these things are.

They were first introduced actually in 2005, so they haven’t been around all that long, and most people still don’t know that they exist, but they behave just like most of the monthly options in pretty much every aspect except of course that they only exist for eight days and hence, that's where they get their weekly feature.

They are introduced each Thursday into the market, and then they expire eight days later on Friday. They're not just one seven-day contract. They’re introduced on Thursday before and then they expire that next Friday.

But what's important to know about weekly options is that they aren’t on the week that has a monthly contract. In most cases, the weekly options will be for most of the weeks preceding and after that monthly contract, but they won’t overlap and correspond.

The way that most people use them is that it provides traders with more targeted expiration dates for hedging and speculation, but we use them mainly here at Option Alpha for earnings trades that come up every quarter for most stocks.

One of the great features of weekly options is that you can target some hedging that you do or speculation for a very short period.

You don’t have to go out far on a monthly contract, 30 or 60 days out if you’re only trying to hedge maybe a company announcement that is coming out next week.

You can use a weekly option to more deliberately and specifically target that individual event. It makes it really good for that purpose, but as far as general trading goes, we don’t use them that often here at Option Alpha because we’re more of position traders, so we don't trade the weekly options.

We like to have a little bit bigger positions in the monthly contracts. But we will use them for earnings trades to take advantage of that implied volatility crush that happens after earnings, that one-day event.

Here on the screen, you can see we have a calendar, and this would be July. It just shows you what that timeframe looks like. They would come out on a Thursday and then they would expire the next Friday. That’s usually what happens.

Honestly, our little calendar here is wrong, but we couldn't figure out how to change it in the graphic thing that we had because this is showing us the third Friday in the month which would usually be monthly options, but you get the whole idea.

This is about the timeframe that it happens, are they come out on Thursday and then they expire on that Friday. [Inaudible] slip on just that tiny little feature, but I don’t want a million people commenting on this video saying, “But it’s the third Friday of the month?”

I get it. I understand. We’re just trying to show you how weekly options work. That’s it. Those are how weekly options work, how they are beneficial in the market.

If you have any comments or questions about how you trade them, how we trade them, please ask them right below in the comment section. I’ll make sure that I get back to all of those in a timely fashion so that you guys get your answers. Happy trading!