right now, catching you up after a tumultuous week. indices ending the cdaydown. however, for the week, the dow is nearly unchanged. the s&p moderately higher. the nasdaq is up more than 4%. that nasdaq number, though, may be giving investors a false sense of security. we'll explain that plus we are still in the midst of earningsnd system one restaurant side could provide welcome refreshment. on the desk tonight, mike khouw,

carter worth, and bonawyn eison. we wanted to provide you with an options psa on risk management there is a unique car insurance happening around options and svb and similar names that could leave you vulnerable if you're not sure how to handle it. mike, you did tweet out a warning and it's worth repeating as we look down the options change further out in time. >> one of the important things to remember is you do occasionally get special circumstances. you might trade options on silicon valley bank, and suddenly you wake up and the stocks have been halted. your question is, what becomes of the options that i currently hold so, it's interesting, and it's available publicly if you're interested you can go to the occ.com. that's the options clearing corporation. and they publish info memos. it's there fr there i learned the following. options clearing corporation was and is imposing no restriction

on -- and in silicon valley bank shares that means if you hold puts that are expiring today or the subsequent expirations, you can still exercise those options that's not to say that there aren't some important changes, though number one, the options clearing corps normally automatically exercises options that are in the money by a penny or more, and they suspend that in the event of trading halts as you have in this chase so both stocks are halted. options are not going to be exercised automatically. you need to instruct your broker secondly -- not going to be handling it. that's broker to broker. this isn't something customers node to worry about, but one of the side effects is it's going to be more cumbersome. the shares aren't available to borrow what's going on here the occ is going to make combinations if it is necessary to do so if the shares aren't available. the there are settlement

problems, they can actually push back the settlement date, they can even change the deliverable. for example, if you exercise push, there's a chance that rather than needing to deliver the shares they're going to come up with some kind of cash settlement process the important thing for you to think about is whether the value of these underlying stocks is blow the strike of the puts tha you own. i assume nobody's going to be exercising call options. and you would want to exercise those options if you believe they are first republic just announced they're going to be doing a private investment, sometimes known as a pipe transaction. it's different than a secondary. that stock is trading lower afterhours and it's down 75% since last thursday, which is the last time those other banks were trading the you're wondering, is silicon valley bank less than where it was trading when it was available to do so, same thing with signature, i'd say look at the bang that's still alive. look at the bank that just

received $30 million 75% lower than it was. the value of signature bank to the extent there is any value at all, the value of shares to the extent there's any value at all must be lower than when it was when they were available to trade. >> let's look at the broader markets. what a week between gains and losses as investors grappleds with fallout from silicon valley bank and the rest of the market. the bank causing unusual options and etfs, but also stirring up action of the tlt and xle energy etf. carter, a quick recap of what you think of the s&p 500. >> terms and numbers -- date is an arbitrary time frame. but what we have is an s&p that is down % versus the s&p up 2. the s&p 100 up four and a half, the s&p top 50 up eight and a

half, meaning it's in order of the larger you are, the better you are, and the qs up 15% without the move in the qs, the market would be worse. this is elemental. what do you do about the move in the qs do you chase that, or is it itself getting done? my hunch the latter and it itself is already being overdone. >> what do you think >> we had this performance we've seen over the last couple weeks. pretty much if you chart the qs or gld or safe haven assets against banks, you'll see an inverse chart so i think as carter mentioned earlier, who is your incremental buyer and as you've known for some time i have been leaning bearish. i think rates and everything else points to a declining economic outlook. >> i'm going to go out on a limb and say mike agrees with those two gentleman in new york. >> that was a very good bet. the situation here the biggest firms, the ones that have been

doing best most recently are actually also among the more expensive ones if you're looking for value, this isn't the place you want to be these broad indices, whether you're looking at the sector xla or qs, this is going to be -- this is all the familiar names the bang names or maga names if we're going to borrow from dan nathan's act ro enemies. if you're looking to push a short or hedge your portfolio, which is what most of us are going to be doing because you own stocks you're dealing with higher vola volatilities trading the a bigger premium than you would historically see, so i think you could just look out to may, put a put spread on in the qqqs to hedge, and you have a better opportunity to do so now that these things have

gone up. i was looking at a 275 put spread in may, and you can risk 2% of the value of the underlight qqq shares to put that trade on and get some nice downside protection. this is different than an outright tail hedge. this is different than making a big bearish bet. this is just basically looking for maybe range bound to weaker, really, is what we're thinking this is a trade that's very similar to the ones i have on in the sbx. >> let's get to the banks here and talk about what we've seen in the xlf as well as regionals. i would imagine, carter the charts look similar. >> they do the regional banks are a beta trade within financials. insurance stocks also getting hurt asset managers also hurt the regional banks are the epicenter of the problem the issue is this -- there is weakness to take advantage of, discounts that are good, and then there's weakness to stay away from, discounts that are bad. it's not a discount. it's a value trap.

you want to stay away from the weakness in banks. >> mike, what do you think >> yeah, i mean, first of all, this is deep-end of the pool stuff. all you need to do is take a look at how the regionals did this week. it's been exceptionally choppy i certainly fielded a lot of questions from people who wondered whether this is a good opportunity to get in. it is important to remember when you're dealing with financial stocks, these are levered financial sheets doesn't take much more things to go sideways. i think you want to see things settle out more before you start dipping your foot into the water here >> all right, and let's move on to tlt you're talking about safe haven trades what do you think of this trade at this point? >> the move has been -- we're talk about rates, volatility within the rate sector, which to me has been exacerbated. i think that's what catches your

eye. i'd be inclined to play here you can really drill down into the fed and get a better understanding of monetary policy, versus trying to understand what happens in a situation where there's an infusion in a particular regional bank and what happens when those assets get market to market i think there's quite a bit of trading opportunity in the fixed income portion of your etfs and i'd be looking here for indices while the fed and policy remains front and center. >> let's talk about gold now there's a big fat decision coming up. that happens wednesday one safe haven trade could see a big move higher. mike, what's the trade here? >> here's the thing. if we start to see -- look what tlt did today. when bonds are going up, rates going down gold also tends to be a safe haven in time of trouble i think we're seeing that. we have had good size moves this week my thinking is you want to own it here.

i think it's a good hedge against the portfolio. it's a good hedge in the rate picture. so i was actually trying to take advantage of the dynamic that we have so i was talking before about skew, which is how out of the money put options on equity indices traded at a praem yum to the at the money volatilities. when you're dealing with commodities such as gold, the exact opposite dynamic exists and that is because a lot a people think -- and you'll see a premium to the call options instead, and you can take advantage of that when you're putting the call structure on it typically doesn't work for you but in this case it actually does i was looking at the may 180 to 200. you can buy that $15 call spread for a little over 3 bucks so once again risks just over 2% or so of the underline to make a bullish bet here gold is going to trade off the

news we get next week with the fomc decision. we can expect that if the rates stay where they are, and in the very unlikely case they would go lower i don't see how they could justify that, but if they did, it would be off to the races for sure, and of course if you a barbell on, that's when you could see it pay off on both sides. >> we know, carter, that at the beginning of the year you really liked the gold trade and probably like it more now. >> i do. if you think about it just in the perspective of, if the market's peak was january 2022 right now, the s&p is down about 19%. and gold miners are down they're still stocks but gold is up 8 -- 9 since then, and it is doing its job. it is a hedge. it has always been a hedge, and it is serving that purpose in a perfect way. >> hedge for you, bonawyn? >> it is not the only one, but a

worthwhile hedge, particularly considering there's a worry about contagious quality gold is one of the places you're looking. >> what are the other hedges you have >> listen, i think the evangelists in bitcoin argue this is the type of securities we're looking for. you can argue whether it's a security or commodity. not going get into the weeds of but being there's a concern about the underlying banking system, i think you can argue boit c bitcoin is in place for these events. >> what do you say to young bonawyn in. >> i'm not sure i know anything about it, other than the chart looks okay but i'm not sure anyone know what is bitcoin is. >> the chart looking okay is a lot. mike in terms of other hedges? i'm guessing not bitcoin for you. >> you know what's interesting about the bitcoin conversation is it used to be a good barometer of the risk on risk

off trade. in a risk on/risk off va environment -- the it does serve as a hedge, you would expect to it rise when equities fall i don't have an exposure to it, but i could understand why one might. the other hedges that i would advocate are exactly the ones we've already discussed. you can put on put spreads in index or index processes, you can own gold and in the case of tlt, it's interesting because options premium tend to be low there, and this is moving around more than it historically does, so that also i think is a mechanism that you can use to hedge directionally by using options on tlt. >> still to come, a potential bright spot after an agonizing market week on restaurant stock. how should you be petitioning? an options order up next. there's much more "options action" right after this

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welcome back it's been a busy week of market action and next week is not looking any different. we have big names slated to report quarterly results if you're looking for a bright spot in the name of red, traders miff a name for you mike, what are you look about >> we're taking a look at darden restaurants. this is an interesting situation, because we have a lot

of economic turmoil that we're confronting ourselves with, and this is maybe a discretionary area, but what's interesting about darden is from an operational standpoint they've doing well they've seen sale and margin outperformance we did see an uptake in seated diners over their most recent reports we've seen this is a company that has a decently strong balance sheet. they have good size and i think that puts them at a competitive advantage. the downsides are that we're in a tough economic environment we could see people pulling back and darden does trade at a bit of a premium to the group. so as i was taking a look at this, a couple things to think about over the past 0 to 12 reported earnings, what we've really seen is generally positive performance coming out of the earnings, but the moves tend over the next month or so to be generally pretty muted this upcoming report is going to represent the final and last

three years. we haven't seen move mrs. than 10% except going back a little longer than that i think what you can do is look at putting on a call diagonal. i was looking at putting on an april/may diagonal, potentially at the money 150 call spending just under six bucks and spending the nearer dated 155s in april net net you're going to be spending about $3.60 a contract to put this trade on, so 2% over the stock praise this is the kind of trade you want to use if you have a modestly bullish view going into a catalyst such as earnings. if you see a situation like we saw in fedex this week and they blow the doors off and stock is up 12% on the day -- including the intraday and aftermarket move they reported this is for that modest 5% to 10% upside over the course

following the month of earnings you're looking for. >> carter, what do you think >> modest upside is the word we're looking for. that's not a bad thing stocks relative to mcdonald's, to chipotle, to yum, to the restaurant group, is very, very good the chart is up and to the right in a benign way. not robust like nvidia it looks headed higher i would want to be long going in. >> how about you, bonawyn? >> if one was to want to play in the discretionary area, they have performed good. the company's been delevering consistently since 2020. also like you're taking advantage of the easternings premium and gives you the option if you want to to put on a -- >> are you concerned companies are going to have a from a pass to take down unguided given the

uncertainties? >> if they have a free pass you would expect that's going to be baked in we have seen some weaknesses one did trade off a little bit today, and that's one of the reasons you want to use options in a situation like this we are in a fairly volatile market condition if you could own the stock or own an options trade that risks a little over 2% of it to make a modestly bullish bet rather than getting long in the stock, that's a way to play it. that's a good way to think about options trades in a market like this these are substitute for long or short equity positions. >> coming up, after a huge week of action, we're answering your questions. got a lot of them. next

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for my roth ira. what's your thought on the 31 june 16, 2024 call a potential gap fill >> i think this is challenging consider it's for your roth ira you're using time as your advantage to continue to build wealth using something so short date in the your roth ira gives you the risk of burning up all that action premium i prefer you just buy the stock if you want to long exposure. >> our next tweet says in 2021 and 2022 the treasury yield and dollar index were quite similarly correlated do you anticipate the same in the u.s. dollar index? >> i'm in the camp rate goes lower and equities go lower and, the dollar here is a pair of 2s. they're not that correlated right now. i think the dollar is going sit tight as rates go lower. >> it's like your favorite phrase these days.

>> you know what it is it's real wisdom i think. >> that is very true our next fan asks, with the volatility coming from banks how would you feel about selling pltr puts for the june 16th strike >> first of all, i like the way you're thinking which is when volatility is elevated and you have a stock you like, maybe you can take advantage by selling cash covered puts. the worst thing that happens is stock falls and you own it as a discount to the current share price. the june puts would yield you just shy of 8% over the next 90 days and if ift stock is put to you it's going to be 18% discount where it is today that said, i'm not crazy about it itself. there's a high short interest here that actually creates a floor for stocks because even if the market hates them you're going

to see the short covering rallies. that provides upside skewness but i like where your head's at. if you like palantir, go forth and prosper. >> is sell nvidia april 21 ps 175 -- >> deeper money kuhls don't offer you much value i would not suggest calling those. if you're intent on selling something, maybe the 275,500 would be better. >> how does that chart look? >> steep, uncorrected, cwdroed things like that. >> bad >> sell or not sell, i would ing. it's an entire trading experience. with innovation that lets you customize interfaces, charts and orders to your style of trading. personalized education to expand your perspective.

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good luck. td ameritrade, this is anna. hi anna, this position is all over the place, help! hey professor, subscriptions are down but that's only an estimated 15% of their valuation. do you think the market is overreacting? how'd you know that? the company profile tool, in thinkorswim®. yes, i love you!! please ignore that. td ameritrade. award-winning customer service that has your back. time for the final call. carter. >> gold, you want to be long, and oil, too.

>> bonawyn >> i tend to agree gld, i like mike's trade. >> mike? >> that makes all of us on the exact same page, but i think you want to make call spreads. >> that does it for us see balk here next friday at 5:30 for more "options action. but don' 5:30 don't go anywhere, taking stock starts right now. >> regulators plan to try once again to auction off svb after they were unable to do so. >> i think silicon valley is a unique outlier they did everything wrong. >> there's so much '08 ptsds. >> credit suisse becomes the latest crisis. >> and that's continuing here in the u.s. first republic as 11 banks team up for a 30 billion deposit rescue.