Education
How GammaRips Works
One V5.4 options trade a day, or none. Scored while you sleep, pushed to your phone at 07:30 ET. Here's the full pipeline.
Your morning at 07:30 ET
At 07:30 ET, one message lands in your phone. Either it's today's single V5.4 pick — one ticker, one contract, a pre-set −60% stop and +80% target — or the engine says no trade today and you do nothing.
At 10:00 ET, you place the trade: buy one contract at market, arm both GTC exit orders, put your phone down. At 15:50 ET on day-3, an exit reminder fires if the trade is still open. Close at market, log the outcome, move on.
That's the whole product. Everything below is how the engine gets to that one message.
What is unusual options activity?
Unusual options activity (UOA) occurs when options trading volume significantly exceeds normal levels for a particular stock. It can signal that institutional traders — hedge funds, pension funds, large trading desks — are building new positions.
Key indicators include the volume-to-open-interest ratio (fresh activity vs. existing positions), dollar flow (total capital deployed), and directional imbalance (calls vs. puts).
GammaRips tracks this across 5,230+ tickers every night, then applies deterministic filters to isolate the single highest-conviction setup.
The enrichment gate
Each night the scanner produces hundreds of raw flow events. Three deterministic gates narrow that list down to enrichment-worthy candidates:
Overnight score ≥ 1
The scanner's internal conviction score must clear a minimum floor — combines positioning size, strike breadth, Vol/OI, and directional imbalance.
Spread ≤ 10%
The bid-ask spread on the recommended contract must be tight enough to be tradeable at market. Wide spreads on thin contracts are dropped.
Directional UOA > $500K
The name-level net directional dollar flow must exceed $500K. Institutional footprint, not single-contract anomalies.
Anything that fails any gate is discarded. Whatever survives is enriched with news context, technical levels, and a recommended contract — that full list is published to /signals.
Selecting the one V5.4 pick
At 07:30 ET, the notifier runs a second filter stack over the enriched list and picks at most one contract:
- V/OI > 2 — the day's flow on that contract must be more than double its standing open interest.
- Moneyness 5–15% OTM — the recommended contract must sit 5 to 15 percent out-of-the-money, not at-the-money and not deep OTM lottery tickets.
- VIX ≤ VIX3M — the term structure must be in contango. If VIX is above VIX3M (backwardation), the regime gate fails closed and the engine skips the day.
- Deterministic tiebreak — when multiple candidates survive, a five-key deterministic ordering picks the same contract every time given the same inputs. No randomness, no human judgment.
Some days the filters eliminate every candidate and the 09:00 message says so. That's the correct behavior — skipping beats forcing a trade.
Execution rules (V5.4)
- Entry: 10:00 ET day-1 at market.
- Stop: −60% option price, GTC.
- Target: +80% option price, GTC.
- Hold: up to three sessions.
- Exit: 15:50 ET day-3 at market if stop and target both untouched.
- Conservative tiebreak: if a single bar touches both stop and target, the stop wins (lower-bound assumption).
Every closed trade — winners and losers, counted the same way — is written to the public paper-trading ledger at /scorecard.
Signals vs. trade recommendations
GammaRips publishes paper-trading performance and educational content. Every pick and ledger row is the output of a mechanical engine — not personalized advice. You trade your own account; GammaRips does not manage your money. Past performance does not guarantee future results.