SOI Glossary

If you haven't already, please watch the newsletter tutorial: http://www.sascapitalag.com/newsletter-overview/. Otherwise, it is very likely you'll misinterpret how to read the options below. Estimated margin requirement for a naked put position is listed. Anything requiring margin of 50% or greater is highlighted in red and marked above average risk (i.e., go lite if going at all).
Note: newbies and small accounts may want to stay away from any option with red.

Rules For Closing Out Early:
1.) Options that are within $10 of their strike go on watch.
2.) #1 + option is under 200 day is on alert. If P/L is positive, it will be closed for small profit (profit target not hit).
3.) #1 + #2 + earnings coming up in 10 days. This closes regardless of where P/L is. Generally, #1 and #2 should prevent this from slipping too much.
Watch is similar to a thunderstorm watch. It's awareness. Alert means time to take action.

Each:
This is the "unit of premium" or UoP. It shows the amount of return based on a specific amount of premium. In the example below, .80 is the UoP. Each .80 will return 9.04%. UoP is linear. 1.60 will return 18.08%.
* Each .80 = 9.04% (163% A)
The "A" value is the annualized return based on the expected holding period.

NNOB:

No New Open Below price. If stock price is below NNOB price, no new positions should be opened. The option is a hold only below NNOB.

IV:
This is implied volatility of the option. Think of IV as a way to measure how overpriced an option is. Options with an IV over 55% are fairly overvalued. Meaning, the option has an air gap and there is room to fall. Over 55% will highlight yellow rather than red and only appears if IV is over 55% . IV often over estimates. But the higher the value, the more likely volatility will come into play. I've found well known brands usually have IVs that are below 60%.

High returns do not equal high IV. Even lower return options can have high IVs.
If going with higher IV options, in this case any over 55%, it's best to go lite.
References to "market" are the S&P 500 index.

Please note: Earnings are only estimates.  Check announcements from each company as the estimated earnings date draws near.

What does it mean when an options drops from the list?
Mainly this happens because premiums no longer present a good return. Options that fall off the list are no longer positions to open. They may still be held or closed out.
An option can be removed because of its distress level, which is a sign of higher than average bankruptcy risk. Continuing to hold these positions presents higher than average risk.

Sizing:
This is a risk measure playing two roles. It is an overall indicator of risk on the option. It's values are:
* Small
* Normal
* Large

These are position sizing values. More risk equates to smaller position sizing (below normal number of contracts). Below average risk equates to above normal number of contracts. A normal number of contracts is personal preference and usually dependent on account size. Smaller accounts with a normal size of one contract would not go in on a "small" sizing since they have no way to reduce risk through contract sizing.