The BEST Trade to Make NOW! ("Arbitrage" Opportunity?) - Wealth and Health Podcast

Summary4 min read

Wealth and Health Podcast — Episode Summary

Episode Title: The BEST Trade to Make NOW! ("Arbitrage" Opportunity?)
Host: David Jaffee
Date: January 21, 2026

Episode Overview

In this episode, David Jaffee presents what he considers the best options trade to make at the moment, focusing on a premium-selling, multi-leg strategy involving GLD (the SPDR Gold Shares ETF). He walks listeners through structuring a trade that balances risk, reward, and capital commitment, and discusses how to adapt these trades based on personal market views. The episode emphasizes constructing trades that act as "arbitrage opportunities" — potential setups where the risk and reward are disproportionately favorable. He also touches on how these strategies reduce portfolio volatility and can lead to consistent profits, contrasting his approach with that of other trading educators.

Key Discussion Points & Insights

1. Identifying the Trade Opportunity (01:01–01:40)

Market Context: David notes the current date (January 11, 2026) and says he’s eyeing option expiration dates out to February 6, but also mentions alternatives like February 13 or 20.
Asset Outlook: He highlights GLD's "bullish pattern," observing a significant rally over the past few months from $370 to $415.

2. Structuring the Multi-Leg Options Trade (01:40–03:20)

Debit Call Spread:
- Buy the 422 call and sell the 430 call on GLD, creating a vertical call debit spread.
- Offers $800 of upside potential with a cost of about $2.58 per contract.
Selling Naked Puts to Finance the Trade:
- Sell two naked puts at the 384 strike price (a 7–8% decline from the current GLD price).
- If more conservative, sell one put at a higher strike (394).
- David prefers selling two 384 puts because he would "love to own GLD at that price."
Trade Assembly (Order Entry):
- Explains how to set up the order: negative quantity for selling puts, positive for buying spreads.
- "I finally figured out how to modify the order details so that it shows two naked puts at a strike price of 384 and then one long call debit spread at the 422 by 430." — David Jaffee [02:38]
Potential Credit/Profit:
- Structure the legs for an even money, small credit, or small debit situation.
- For this setup: “You can see that in this situation we would receive a $12 credit for every increment that we would put on.” [02:56]
- “I’m picking up around $8 of potential profit and I’m only paying around $250–$260. To me, that’s an arbitrage opportunity…” [03:21]

3. Risk, Flexibility, and Position Management (03:20–03:54)

Assignment & Discount Buying:
- "By selling two of the 384 naked puts…this would give me the opportunity to get assigned and take ownership of shares at a substantial discount.” [03:36]
Flexibility with Other Legs:
- “You can actually add naked calls here. If you feel uncomfortable selling naked puts.”
- Demonstrates a further-modified setup:
  - Sell two naked puts (384), two naked calls (470).
  - “We’re actually picking up $108.” [03:50]
Tailoring to Market Bias:
- “Let’s say I was more concerned that gold was going to pull back. In that situation, maybe I would want to increase this to 3 [calls] and then maybe decrease the short puts to 1.” [03:58]
- Alternatively: “Or if I didn’t want to sell 3, then what I could do, I could sell 2 and instead of making it $8 wide, I can decrease the 430 to 428 and therefore I would be able to structure this for credit.” [04:10]

4. Closing Thoughts & Call to Action (04:10–04:44)

Encourages interaction: “If you have any questions, leave a comment below. Also, let me know if you like these type of educational videos. Please like this video and subscribe. And I appreciate your attention.” [04:26]

Notable Quotes & Memorable Moments

On risk/reward:
“To me, that’s an arbitrage opportunity, even though I know that the most likely scenario for this trade is that all the legs are going to expire worthless.” — David Jaffee [03:21]
On flexibility:
“By modifying the structure, it gives you substantial flexibility.” — David Jaffee [03:54]
On assignment and value:
“This would give me the opportunity to get assigned and take ownership of shares at a substantial discount.” — David Jaffee [03:36]

Timestamps for Key Segments

01:01 – Introduction to the trade and GLD’s context
01:40 – Building the call debit spread and selling naked puts
02:38 – Order entry and trade modeling
02:56 – Expected credit and profit analysis
03:21 – Arbitrage opportunity explanation
03:36 – Assignment risk and price advantage
03:50 – Adding naked calls for additional credit
03:58 – Adapting trade structure for various market forecasts
04:26 – Listener engagement and outro

Summary & Takeaway

David Jaffee’s strategy offers a comprehensive method for retail traders to leverage multi-leg options for consistent profits with manageable risk. He underscores the importance of flexibility, structured thinking, and being deliberate about potential assignment. His use of "arbitrage" is more about creating trades with highly favorable probabilities and payoffs, rather than riskless gains.

This episode is valuable for listeners looking for actionable, detailed options strategies, especially those seeking to combine bullish outlooks with rational risk management tactics.

For more resources and detailed training, David invites listeners to visit beststockstrategy.com.

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Transcript4 lines

[00:00]
A
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[00:37]
B
My name is David Jaffee. Welcome to the wealth and Health Podcast where you'll learn valuable skills and positive habits that will improve your life. This podcast originally aired as a video on my YouTube channel at YouTube.com beststopstrategy. The wealth and Health Podcast is brought to you by beststockstrategy.com
[01:02]
C
Right now it's January 11th. I need to go to sleep soon, but if we look out to the February 6th, you can also choose the February 13th or the February 20th. But let's choose the February 6th. We can then buy a call debit spread so that way it'll give us upside potential because GLD is in a bullish pattern. You can see over the past few months it's gone up tremendously from about 370 all the way to about 415. We can buy the 422. We can then sell the 430. By buying the 422 and selling the 430. This gives us $800 of potential upside and we're only going to pay around $2.58. Now to finance that we can sell some naked put options at strike prices where we would love to take ownership. What I like to do is I like to go further out of the money and I'll sell two of them. So I'll sell two of the 384s. If I only wanted to sell one then I could sell one of the 394. But in this situation I would prefer to sell two of the 384. And the way that we would do this is we would Change this to negative 2. I finally figured out how to modify the order details so that it shows two naked puts at a strike price of 384 and then one long call debit spread at the 422 by 430. Generally speaking, I like to structure these trades so that they're around even or a small credit or even potentially a small debit when putting them on. You can see that in this situation we would receive a $12 credit for every increment that we would put on. So if we wanted to do 2 increments, then we would sell 4 of the naked 384s and then we will buy 2 of the 422 by 430 call debit spread. The great thing about this trade structure is that I'm picking up around $8 of potential profit and I'm only paying around 250 or $260. To me, that's an arbitrage opportunity, even though I know that the most likely scenario for this trade is that all the legs are going to expire worthless. Additionally, by selling two of the 384 naked puts, because I would love to own GLD at a strike price of 384, which would be around a 7 or 8% decrease from where it's currently trading at, this would give me the opportunity to get assigned and take ownership of shares at a substantial discount. Another thing that I really like doing. You can actually add naked calls here. If you feel uncomfortable selling naked puts. Let me model that out right now. All right, so in this situation, we're going to sell the 470 call options as well. So here you can see that we're selling two naked puts at 384. We're selling two naked calls at a strike price of 470 and therefore we're actually picking up $108. By modifying the structure, it gives you substantial flexibility. Let's say I was more concerned that gold was going to pull back. In that situation, maybe I would want to increase this to 3 and then maybe decrease the short puts to 1. Or if I didn't want to sell 3, then what I could do, I could sell 2 and instead of making it $8 wide, I can decrease the 430 to 428 and therefore I would be able to structure this for credit. If you have any questions, leave a comment below. Also, let me know if you like these type of educational videos. Please like this video and subscribe. And I appreciate your attention.
[04:45]
B
Visit beststockstrategy.com and submit your email address to receive invaluable free training. Please give this podcast a positive reading and review. If you have any questions, visit beststockstrategy.com and send me a message.