I have to come clean and admit that I occasionally like a little excitement in my trading. Sure I love to make money and be profitable with high probability spreads that have defined risk, but that can be dull. And I don't mind dull to make money. Understand I use these strategies (Verticals, Iron Condors) continually as my revenue generator so that I can take very small pieces of capital and get kooky with them. When I say kooky I mean that I still monitor and define my risks, but I may implements strategies I know have a relatively low probability of success. Often times for me this can mean BUYING options or straddles in products I know are unpredictable. I am not a very frequent option buyer as you can tell. Fans of Seinfeld can relate in this way: Remember when George decided he was going to do the opposite of whatever he thought he should do and the results were terrific? He promptly told a woman he was bald, unemployed and lived at home and she fell for him. My point is that we all get rules and probabilities and guidelines for success and understand we need to put the probabilities in our favor, but once in a while it is fun to just let loose. Again, very small amounts of capital and limited risk with this!

The instruments one can use to fulfill those needs of excitement are often easy to find. Watch the news or read the paper and it becomes evident fairly quickly where the real flyers in the market are. Finding them is easy, but now what do we do with them? You are wise enough to realize if something has the potential to really take off and be profitable, generally it also has some inherently large risks. That is the reason we play in limited risk and limited capital in these areas.

Let's talk about some recent volatile instruments, commodities, oil, financials, currencies, solars and a smattering of some sector ETF's. I am not going to prescribe anything in particular so don't hold your breath. I will tell you I have played with Google, FSLR, LEH, and BSC (ouch) C, YHOO and some Oil and Currency ETF's. What have I done? I have bought small amounts of stock, options, sold naked puts, sold verticals and calendars all in products I would normally avoid. Notice everything above has limited risk and I watch it diligently.

The problem with trading in this manner? First, it may not be successful. Second, these are products you may fully understand but don't often trade. Experience in a product is huge and that is why many successful traders use the same products consistently. Finally, what frequently happens is that folks dabble small in a flyer and if they are profitable they start over allocating to that product. You can guess how that turns out.

Remember the most important aspect of this article. This is your SMALL play money and not meant to be a staple of your trading strategy. Scratch those itches and play, but be smart!

thinkorswim, Inc. and its registered employee, Steve Quirk, do not solicit or recommend any form of trading in the individual stocks (or their derivatives) mentioned above. Please do careful, independent research before investing any money as well as weigh the possible consequences on your particular financial situation before doing so. The risk of loss may be substantial.