Dear Trader,

It was almost perfect timing. Just like in 2022, something I thought would never happen, happened.

In 2022, I developed a solid approach to trading S&P 500 (SPX) on the day of expiration. At the time, options expired every Friday and that was IT. Then in February of 2022, the CBOE announced they'd begin trading options on Monday, Wednesday, and Friday, with plans to add Tuesday and Thursday in the near future.

I'm not one to brag, but I have to say, I saw what was coming and jumped in with both feet. Within weeks, I was guiding my traders through the 0DTE landscape, and we were making money.

Over the next year or so, I was consistently landing triple-digit winners using my cash zone trades. Like all things, though, things changed. I'll be frank, it took me a hot second to figure out what shifted, but something seriously shifted.

Then the lightbulb went off: there are a lot of hedge funds, asset managers, and retail traders unloading options on a daily basis into the 0DTE market looking to make "income."

Within 18 months, mutual funds and ETFs opened up that sold the idea they created "income" every day by selling 0DTE options on SPX and the names that shortly followed (Invesco QQQ Trust (QQQ) and iShares Russell 2000 ETF (IWM), for instance).

At first, I was discouraged because these traders were KILLING the exact options that were part of my cash zone trades. As I figured out what they were doing, it took me a good week in the "lab" (periods of time I stop trading and just research) to figure it out.

The Premium Flood That Broke the Model

What changed was the absolute deluge of premium selling hitting near-dated options. Just about everyone, outside of myself, was selling as much 0DTE premium as they possibly could, because they needed to produce "income."

Author's note: you'll see my use of quotations around the word income, because that is NOT what you're doing when you sell premium in options. These trades do have a cost, and I'm about to explain that.

With asset managers, hedge funds, mutual funds, and ETFs selling premium, the common approach would be to simply go along with the crowd and do the same. I saw opportunity instead.

What I realized was that there was so much volume moving one way, prices in short-dated options were becoming aggressively wrong. And that wrongness has persisted. Here's an example.

On Monday, the S&P 500 had a range of over 100 points, yet at the end of the day, I could set up a play that would make money if that index moved more than 30 points. I put on that play and banked a nice win.

The Spillover Nobody's Watching

What you may not know is there's a spillover effect. S&P 500 option prices trickle down to their component parts. The nine stocks that just began trading 0DTE in January are seeing the same effect on their options because they make up such a huge chunk of the SPX.

Have no doubt, when they add Tuesdays and Thursdays (which they will do shortly), we'll see mutual funds and ETFs designed to create "income" on these names too.

The current effect of 0DTE option volume in SPX has already made the option prices in these nine names too cheap. When the ETFs around these names launch, premium prices are going to reach another level of cheap.

This is where Project MNS comes in. When you combine Licia's charting skills and the fact that the options she's looking at are statistically too cheap, a person like me can make some serious dollars.

Licia and I are hosting a zero and one DTE 3-day live event starting today called Own the Clock.

I'd like you to join.

I'm going to teach you why these options are so cheap, and Licia is going to show you the trends of 0DTE options and HOW she charts them.

Join the two of us today at 2 PM ET.

Your only option,

Mark Sebastian