A story is playing out right now that’s not getting nearly the attention it deserves, and that’s probably because it doesn’t come wrapped in the latest buzzwords or a shiny AI ticker.
But this one really matters, especially if you’re serious about options trading.
Berkshire Hathaway just reported another solid quarter: Earnings are up, no major red flags, the usual.
But one line in that report should have every trader sitting up straight:
Cash on hand: nearly $382 billion.
That’s not a typo. It’s a record pile of cash just sitting there, waiting.
Warren Buffett isn’t throwing that capital at stocks, bonds, or even his own company (no new buybacks announced).
And he’s not doing it because he’s suddenly shy at 95.
No, Buffett is biding his time for a reason: He doesn’t like what he sees in this market.
And he’s not alone.
Prominent Morgan Stanley and Goldman Sachs analysts have come out in recent days warning of a significant market correction on the horizon — likely within the next 18 to 24 months.
Their reasons vary: inflated valuations, stretched consumer credit, the Fed potentially holding rates higher for longer…you’ve seen the headlines.
But the takeaway here is simple: Buffett’s wielding an enormous dry powder position because he’s waiting for a fat pitch.
He knows that chaos brings opportunity, and he’s willing to let it come to him.
So…what does that mean for you as an options trader?
Pull up a chair and I’ll tell you.
Here’s What It Means
The next 6 to 12 months could present the kind of conditions where serious traders can achieve serious gains.
If you’re only thinking about “what’s hot this week,” you’re missing the larger setup.
Here’s what you should be thinking about instead:
1. Watch Volatility Creep
Volatility doesn’t explode out of nowhere. It builds slowly and quietly.
We’ve been in a low-volatility environment for a while now, but that’s starting to shift.
The VIX may be calm, but individual names are showing bigger daily swings, particularly in overextended sectors.
When volatility starts expanding across the board, options premiums get juicier.
That’s great for sellers, but it also means you need to be more surgical on the buy side. Know what you’re paying for and why.
2. Keep a Buffett-Like Watchlist
If Buffett’s waiting for better prices, so should you.
Now’s the time to build your “hit list” — stocks you want to own if they drop 20% to 30%, and the levels you’re willing to buy them.
Then use options to put that plan into action. Selling cash-secured puts 10% to 15% below market lets you get paid to wait.
If the stock never hits your strike, you still keep the premium.
If it does? You buy it at your price, not Wall Street’s.
3. Be Patient…But Not Passive
Buffett isn’t frozen. He’s just selective. There are still plenty of names moving cleanly, especially around earnings and macro catalysts.
The key is picking your spots.
Don’t chase. Instead, wait for setups where you’ve got an edge: maybe it’s skewed IV, a high-probability spread, or a directional play that aligns with volume flow.
If you’re trading just to feel busy, you’re missing the bigger opportunity.
Ready, Not Reckless
The smart money is already preparing for the next wave, and you don’t build a $381 billion cash pile by accident.
That’s Buffett, Charlie Munger (RIP), and the entire Berkshire machine sending a message: Be ready, not reckless.
For options traders, this is the time to sharpen your skills. Don’t worry about calling the top — focus on controlling your risk, stacking small wins, and staying liquid.
Because when the market finally breaks — and it will — there’s going to be a flood of opportunity for those who planned ahead. Everyone else will be scrambling.
Be in the first group, not the second.
Stay street smart,
Jeff Zananiri
