It is always interesting to see a new website that sets out to be a one-stop shop for market news and analysis. There are already more than a few such websites on the Internet, many of which have been around for several years. So one of the most obvious questions that comes to mind when encountering what is effectively a startup in this business is, "What have you got that the others don't?"
After all, headlines are headlines, most actives are most active, and you would have to search far and wide for competing market summaries on a given trading day that differed by more than a point or two of emphasis. As I was discussing with a colleague recently, one of the ways these websites distinguish themselves from each other is the path to being a paid customer. Many ostensibly free financial information websites provide a certain amount of free content but then begin to scale up, offering ever more "exclusive" or "professional" or "premium" content for those willing to cough up a few bucks. Like the free stuff? Try the newsletter. Like the newsletter? Try a subscription to our fully automated trading service that does all the work for you.
You might call it the "For a few dollars more" strategy.
MEET THE MONSTER
optionMonster has also embarked upon this well-worn path -- offering a variety of free resources, a number of free tools by way of third parties, and a set of more advanced items and services available by way of paid subscription. The focus on the website is on tools for option traders, as well as information about option trading such as put/call, volatility, and open interest information, that stock and market index traders often rely on as part of their overall market analysis. But optionMonster also seeks to be more than just another option website.
By including basic market information that appeals to traders and investors who trade options as well as those who do not, optionMonster increases the likelihood that the website will be visited and bookmarked by a wider audience of traders than might have been the case otherwise. Part of this strategy involves borrowing tools and resources from a number of excellent third-party providers such as Portfolio 123, iVolatility, and Schaeffer's Investment Research (among many more) to supplement the analysis provided by optionMonster's own team of writers and analysts.
OptionMonster is divided into eight departments, not including the site map: News and Insights, Webcasts, Quotes and Charts, Markets, Tools & Resources, Learning, Newsstand, and Premium Research. Each department has smaller pages within it, so that the News & Insights department, for example, includes Headlines, the Morning Briefing, Pre-market Commentary, Bulletins, Options to Watch, Stocks to Watch, High Volatility, and Index Options. The Webcasts department provides links to multimedia presentations Afternoon Tea and Rocket Fuel as well as podcasts and multimedia from the Chicago Board of Options Exchange (CBOE), CNBC, and Reuters. Quotes & Charts includes links to option chains, depth/Level II tables, a detailed quote page, price history, basic and advanced charts, as well as news.
The Markets department consists of a market summary, major movers, North American and world stock indexes, links to more than 90 different exchanges around the globe, an extensive currency quotes listing, and a cross-rates table. Tools & Resources includes the Ticker Trigger, Portfolio Builder, Strategy Scanner, Position Simulator, Option Tools and Institutional Research. The Learning department includes links to other educational websites, the optionMonster bookstore, online classes, a strategy screener, glossary, and an option quiz called "Options IQ." The Newsstand department consists of three sets of links to financial news resources, technology news resources and global news resources.
There's also a Premium Research department that includes an explanation of what kinds of research are available through the subscription service, a subscription page where traders can subscribe to either OptionTrader Pro, which provides twice-weekly market observations and investment ideas, or InsideOptions, the "top-end" product, which provides multiple investment ideas a day. Both services are available by email or at a special section within the optionMonster website, and can be subscribed to on either a monthly or annual basis.
I want to focus on the Tools & Resources department at optionMonster because it offers variety of interesting features, many of which come from third parties. For example, optionMonster's Ticker Trigger feature lets traders enter in a given ticker symbol and then click on any number of links to access company information, earnings information, analyst ratings, shareholder and institutional ownership data, key financials, and technical charting. These links are to well-known sources such as Yahoo! Finance, Zacks, Cnn Money, Reuters, and the Sec. Divided into two sections, the lowermost section provides similar information as it relates to the stock market in general. Links to earnings highlights, surprises, and conference calls (regardless of the ticker symbol that was entered in the window at the top of the page) can be found here, as can stock sector maps, Ipo information, and stock screeners.
Similarly, optionMonster provides under "Options Tools" a number of links to resources such as Yahoo! Finance, iVolatility, OptionsXpress, CommodityWorld.com, and more. These websites provide specific information on volatility, open interest, greeks, price increases or decreases, put/call data, margin calculators, and option strategies.
Similarly, optionMonster provides links to investment research from investment banks, business schools, financial associations, and central banks. The Other Tools subdepartment has links to information on other financial instruments including exchange traded funds, futures, mutual funds, and bonds.
Another third-party offering through optionMonster is the Portfolio Builder, which comes courtesy of Portfolio 123.com. The Portfolio Builder -- or, more specifically, the offer from Portfolio 123 -- lets traders get access to two of Portfolio 123's statistical portfolio models: Garp (Growth at a Reasonable Price) Top Rated and Value with Momentum. Sample portfolios can range in size from $50,000 to $1 million.
Two other features at optionMonster come courtesy of 888optionsnet.com, the Strategy Scanner and Position Simulator. The Strategy Scanner is essentially a table that compares 18 different option strategies (long calls, short ratio put spread, condors, and so on) with the optimal market conditions for that particular strategy. The other feature is 888optionsnet.com's Position Simulator, which lets option traders enter in the date, starting stock price, interest rate and dividend information, expiration cycle and starting volatility to start off with, and then enter in specific position information (long or short, number of option contracts, call or put, expiration month, strike price, and volatility). The Position Simulator will then create a profit/loss graph, and compare starting values with test values, profit/loss, and delta.
BE A MARKET MONSTER
If you can't beat 'em, join 'em. Or at least let them provide content for your website. In many ways, optionmonster.com takes this approach in order to have a significant amount of content for both option and nonoption traders and investors. Although still in beta, optionMonster provides the sort of market information that still brings traffic to many similar -- if not the most popular -- financial websites. That said, optionMonster has a significant option component --some provided by optionMonster content providers and some provided by third parties -- that will likely draw option traders toward this site and away from others that appear to give short shrift to traders in puts and calls. optionMonster should also be complimented for its inclusion of multimedia in the form of podcasts and video briefings such as Afternoon Tea and Rocket Fuel.
Former Chicago floor trader Jon "Dr. J" Najarian, whose list of credits and accomplishments includes a stint as a linebacker for the Chicago Bears, provides much of the written content at optionMonster, including the Afternoon Tea and premarket commentary. In addition, the website boasts a stable of writers who prepare and produce headline news stories, items for the morning briefing, options and stocks to watch sections, high-volatility alerts, and headline bulletins. Najarian's brother, Pete, is also one of the minds behind optionMonster credited for a great deal of the analytic work along with "Dr. J."
It could be argued that optionMonster has benefited from the financial websites that have come (and gone) before it. What makes optionMonster promising is its combination of free content equally worthwhile for stock as well as option traders, with topical news and analysis that can be used to help traders and investors select from among the best trading opportunities and ideas. Add to this the tools accessible through optionMonster (third party or now), and you've got the beginnings of a worthwhile destination for investors, speculators, and traders -- particularly those interested in derivatives, either as stock substitutes or stock hedges.
If one thing is lacking it might be a robust stock-screener, and a trader can't help but fantasize about the possibility of a partnership between optionMonster and any number of quality stock-screener websites on the Internet. This is especially true given optionMonster's inclusion of content from websites like iVolatility and Optionetics.
As it stands today, optionMonster is a strong initial effort (founded only in 2006) that is only likely to improve as the website designers get more and more feedback from option (and nonoption) traders who use and -- eventually -- come to rely on the information and analysis optionMonster provides.--David Penn, Technical Writer
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Originally published in the June 2007 issue of Technical Analysis of STOCKS & COMMODITIES magazine. All rights reserved. © Copyright 2007, Technical Analysis, Inc.