Anyone Else Sick and Tired of all the Flow Services?
Why Most "Flow Alert" Services Are a Scam
There’s one product in the trading world that seems to dominate my feed harder than almost anything else: “Unusual Options Flow” alert services.
For $299 a month, they promise to deliver the exact trades “smart money” is making in real time. The sales pitch is intoxicating: “See the $10M call sweep that sent NVDA up 12%!”. The reality? It’s one of the most effective scams in retail trading today.
1. It’s Just Useless Noise
These services blast around 2,000+ alerts per day. The problem is that 99% of this data is completely meaningless.
There is zero context provided. Was the trade opened or closed? Was it part of a complex spread? Was the premium paid actually unusual, or just a wide market? Was the flow from a hedge fund or simply a market maker? You don’t know, and they don’t tell you.
2. The Flows Constantly Contradict Each Other
It’s routine to see $8M in bullish calls and $7M in bearish puts hit the tape on the same stock within seconds. The service happily blasts both directions. When the stock eventually moves one way, they crown that side “the smart money” and ignore the other. It’s a perfect heads-I-win, tails-you-lose setup.
3. Cherry-Picking on Steroids
They Cherry-Pick the 1 Winner and Ignore the 999 Losers.
They don’t show you the other 999 alerts that didn’t mean anything.
They’re selling randomness as alpha.
Throw enough darts, highlight the one that hit the board. Use that one as “proof” for their next marketing material. You never, ever see:
Full P&L of every alert
Win rate across the entire diarrhea of alerts
Performance if you had actually traded all the signals
It’s textbook survivorship bias. The losers are buried; only the winners are paraded.
At CI Volatility
We understand options flow in the right hands, and with proper analysis, can be a valuable component of a broader model.
But the retail “flow alert” industry built around it?
That’s survivorship bias bundled as a product.