My Personal 2026 Market Playbook as an Options Seller and Hedge Fund Manager

Hey! As we start 2026, I want to share a few very personal market views and investment ideas I'm going to actively explore this year. This is not a recommendation and not a directional forecast. It's simply how I currently see market structure, volatility, and opportunity from the perspective of an active options seller and short-volatility hedge fund advisor.

1) Metals: the parabolic move may be behind, but volatility lingers

Gold and silver already had their most emotional, parabolic phase. The important nuance is that implied volatility rarely normalizes as fast as price action does, and that lag is where options sellers get paid. So, I'll be very active in GLD, SLV, PALL, and URA, both in my personal portfolio and in our hedge fund. The specific edge I'm watching is post-spike IV that stays sticky after the trend fades, especially when the surface flips into volatility backwardation. That's a perfect setup for short-dated and 0-DTE premium harvesting.

2) Crypto: stagnation is the edge

My base case for crypto is not another explosive trend, but prolonged consolidation. That's exactly why IBIT, the iShares Bitcoin Trust ETF with liquid options, is so interesting. Implied volatility remains structurally rich, often well above realized volatility. I don't trade crypto directionally, but I sell premium strategically. Compared to the industry's obsession with upside narratives, this approach is far less exciting, but it creates a much more consistent income engine.

3) Rate cuts shift income opportunities

If rate cuts continue, my famous "yield engineering" trades like SPX box spreads and risk-free butterflies become less attractive. At the same time, they open a different door. Lower rates support REITs (Realty Income - O - remains my personal favorite), utilities (XLU), healthcare (XLV, UNH), and dividend growth ETFs (SCHD). I consistently combine these with aggressive call writing, creating my Triple Income Strategy. This approach targets an additional 11-18% per annum, with extremely low volatility and zero vega risk!

4) Mega-cap tech stays dominant, but very selectively

I remain constructive on technology and AI as a factor, especially with the launch of the Magnificent 10 index (MGTN). MGTN has cash-settled futures, and Cboe has also published notices around listing options! I expect the outperformance of the Magnificent Seven versus the equal-weighted S&P 500 to persist longer than most anticipate. In the short term, I'm less optimistic about broad exposure via QQQ, XLK, or SMH. Still, this remains the most profitable segment of the market, with extraordinary profit margins.

5) Quiet volatility will reward structure

Contrary to seasonal statistics, I expect longer periods of suppressed volatility in 2026. In that environment, classic short-volatility trades may underperform versus calendar spreads, diagonals, and omnidirectional structures, such as 4-4-1 and flyagonals. At the same time, hedging vega and convexity becomes essential. You never know when the next Black Swan will appear, which is why I continue to provide dedicated Black Swan hedge ideas!

I'll be sharing specific, actionable options trade ideas very soon. I'm also actively working on the 2026 update of our Trading Plan. Let's start 2026 focused, structured, and prepared!

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