The Best Option Traders Lock In Their Profits

Recently, I had an important chat with a stock-option manager who is still seeking for the mysterious formula to yielding dependable returns with option investing each month. He mentioned some things which were so obvious to me and brought up many past memories.

The thing in particular that really stood out to me was when he alleged “Non-directional option investing doesn’t mean we will produce a return on investment in every direction. It really means that we produce a return if the asset doesn’t move in any direction. Another way to look at it, it’s really a directional strategy, sideways.” This is very true, and most schools say that it’s easy to manufacture returns with options simply because we can produce money for every direction the market goes. This is true in some points of view and false in others.

Investors using Condors as their main strategy understand what I am saying here; especially if you are investing in the Iron Condors which most schools and written materials preach. If you are investing with this option spread this year, you most probably aren’t earning much. This is because that the Iron Condor is just as directional as the other option spreads only that it’s direction is sideways. To most, it’s just as difficult to forecast a non-move in the market as it is to forecast market that will be moving.

So many option traders have called me recently to tell me the same thing. “I was doing great with Condors and Credit spreads for a few months, but then last month I lost nearly my whole trading account.” This is so common amongst option traders in today’s market.

This is exactly why I don’t teach traditional Condors and Credit Spreads. If you are a few days from expiration, and the RUT is right at your short strike, then you are trading the way most people trade this strategy, and soon you’ll be telling the same story to your best friend, and you’ll be hiding the truth from your wife! You laugh now, but you won’t be when it happens to you. Another problem with this style of trading is that the stress level is so high that it really ruins your life.

Anyway, to deal with this problem San Jose Options Mentoring has redesigned Iron Condors and Credit Spreads. We have a different technique which gives the underlying much more wiggle room, lowering our stress level and keeping us out of dangerous situations. Remember, the less you have to adjust your condor, the better off you will be in most cases.

Besides teaching a safer way to trade Condors, we’ve also developed techniques to lock-in our profits on them. Most option traders exit their trades when they make a profit, but we can lock-in our profits and stay in the trade.

There’s yet another technique we’ve developed that I’d like to mention before we go. Every trader has some trades that don’t work out right? Well we obviously do too, but in our case, we usually end up with a Bonus Trade which gives us a chance to make back our loss with very little or no risk at all. It’s these little details to trading that make all the difference at the end of the year.

So winner or loser, we have developed a pretty nice way to trade Iron Condors as well as many other strategies.

Are you ready to become an elite option trader? Improve your Option Trading now by visiting San Jose Options Mentoring online at www.sjoptions.com. Visit today and get a Free Video on Option Greeks, a $200 value absolutely free!

Option Trading Success part 2

Welcome to part two of a video series of six on how to trade options successfully. There is some really good advice in these articles and videos, and if you are seriously interested in becoming a successful options trader, then I highly recommend that you spend one hour of your life watching these videos. You can find them all on You Tube.

Back testing is one of the greatest things that you can ever do as an options trader. Now this task can be rather tedious especially with the software that is offered on the current market. The most popular software out there is Optionvue and the other is Think or Swim, the latter being a brokerage. Now in both of these software packages it takes hours and hours of manual labor to produce back testing results. Recently, San Jose Options has released their new back testing tool called the Options Toolkit. With this software we can turn hours into seconds. If your time is valuable to you, then I would highly recommend this software over anything else on the market.

For instance, I used to spend several hours using other options analytical software to back tests stocks over earnings release dates. I was able to find some winning trades; however, the work was so tedious and boring that I did not have the patience to back test 4000 stocks. Now, with the new San Jose Options back tester, I can turn days in into seconds with the single click of a mouse.

Experience is another key to finding success as an options trader. The reason is that the stock market changes constantly, and if you do not have years of experience, you will always be surprised by the next move. Having experience helps understand the market in a deeper way which is very important when it comes to making adjustments on your option trades. Experience traders also do not panic like to beginners do, and this can really make a big difference at the end of the year.

Trading with paper money is another great way to become a better options trader. Most option brokers on the market offer a paper trading account. I personally like what Thinkorswim has to offer. I find their software very robust for trading options, and their paper trading accounts uses the same software as the real account, so it’s a great way to learn. Obviously, it’s a good idea to make consistent returns in your paper trading account for several months before entering option trades with real money. As stated before experience is very important because the stock market changes rapidly and wears many faces.

In the last part of this video we discuss why it’s important to keep about 25% of your money in cash. Good option traders know how to make adjustments, they know how to lock in profits, and they need this money to do just that. It’s never a good idea to use up all of your capital in your trading account. This can lead to serious problems. So again, if you want to become a good option trader, then leave plenty of money in cash so you can always do what you need to do.

To Find Success with Option Trading visit the San Jose Options Course at www.sjoptions.com

Option Credit Spreads Destroyed My Life

Hello option traders and welcome to this discussion about credit spreads. In a few words today we’ll be discussing why it’s so important to have adjustment plans before you enter into a short-term credit spread options trade. Although the credit spread is very popular amongst option trading community the high risk in the trade is not always talked about. Credit spreads can be very risky trades if they are not being hedged by other option strategies, and being that most option traders do not know how to hedge this position, many of traders are losing their trading capital on a daily basis.

The first spread learned by most beginning option traders is the credit spread. It’s a very simple strategy, but what many beginning option traders do not know is that this particular strategy can be very dangerous. There are many courses on the internet that teach this strategy, but the reason is not because it’s a great strategy, but rather, it’s simple, and it’s easy to sell. What I mean to say is that teaching credit spreads to beginning option traders is simply a great business but the fact is, many option traders who only trade credit spreads lose a lot of money each year. Not only do they lose a lot of money, but it’s also a very stressful way to live. Let me explain why.

It’s well known that an option trader can enter into a credit spread with a 90% probability that he will make money on the trade. That is well known. That is the popular belief, especially amongst beginning option traders. This is true, but do not ignore the other side of the picture. Even though you have a 90% probability to make a profit on the trade, you must consider what goes on while the trade is in play. People don’t talk about the level of stress involved.

Salesman don’t tell you how far behind you can be on a credit spread in just a few days if the trade goes against you. Salesmen don’t talk about how you can lose 90% of your trading capital the very first monthly trade credit spreads. Salesmen don’t tell you this stress related but this particular option trade. They don’t tell you that you won’t be able to sleep at night.

Those who tell you that credit spreads are non-directional trades are not telling you the whole truth. It’s true that a credit spread can make money in any direction, but the direction cannot be very far. Also, if the trade goes the wrong way from the beginning, you will be in a very dangerous position, and you will be way behind on the trade. If you are trading short-term credit spreads, you often times find yourself standing at the edge of a cliff and very close to losing all of your trading capital.

Well to conclude this class on the risk of the credit spread, I just like to finish and say that there are many other types of trades that are much safer than this particular option spread. And if you do insist on trading credit spreads, try to combine them with other strategies so they are not so risky.

Thank you,

http://www.sjoptions.com

The Iron Condor is Risky

Hi everybody and welcome to San Jose Options. In this demonstration we will be discussing the dangers of Iron Condors. The Condor is an excellent income strategy, but there are ways to do it correctly and ways not to do it. The purpose of this article is to make every option trader aware of the risks that are involved in trading option spreads if you do not know what you are doing. In particular, trading iron condors close to expiration is very high risk and can lead to catastrophic losses to your trading capital.

In the You Tube video that is embedded into this article you will see an Iron Condor placed on the symbol SPY. This is a perfect example of how not to trade Condors.

This is the strategy that is taught by 99% of the courses on the Internet. Don’t be misled, and don’t fall into the trap. Take a look at this video and see firsthand the stress and the risk involved with this option strategy.

As this option trade nears expiration it becomes more and more risky. The Delta on the position can change extremely fast because the Gamma is extremely high. This means that the trade is outrageously volatile as it gets closer to expiration, and again, if you are near the short strike just a few days before expiration date, then you will be extremely stressed because you will be in a horrible situation. Please watch the video at the 6 minute mark to see what I am talking about.

To wind things down, I hope you have learned some new things about the Iron Condor. I hope you can see that it can make money, but it can also be very risky. Trading Condors into expiration can be very stressful. If you are interested in learning a better way to trade this option spread, then I highly recommend San Jose Options mentoring program.

Thank you and have a great day!

The Latest Options Trading System

NEW OPTIONS TRADING SYSTEM I have always considered my option strategies to be very safe, but recently, I developed a new twist on things that has given me a way to trade with risk-free insurance. I’m very excited about my new trading system, and I would like to tell you about it.

RECENT DISCOVERIES Recently, I’ve developed a Self-Adjusting trading system which in a few words is “Simply Amazing!” What I’ve done is discovered a way to trade with nearly Risk-Free Insurance. What this means is that the insurance I use to protect my trades virtually risks nothing if I do not use it. In a normal situation, insurance strategies lose money each month and eat up the profits, but I’ve designed a way around this problem!

IRON CONDORS WITH Risk-Free INSURANCE One common way that I use this trading system is with the famous Iron Condor. Historically, the Iron Condor cannot handle a market that is moving in a whip-saw pattern. But now I can enjoy the slow-moving Iron Condor in a volatile market by simply using my new insurance plan. I have developed a way to insure the Iron Condor if the market moves up or down with an adjustment strategy that has been until now, virtually undiscovered.

PUTTING IT TO USE Finally I would like to say that I am very excited to put this new option trading system to use. I’ve already been implementing the new concepts into my current options portfolio, and I am seeing instant results. While I will be extremely happy if the market goes sideways, I will be even happier if the market moves over the next two weeks. Thank you for reading this article, and good luck in your option trading.

Before I leave I would just like to say that if you really want to learn how to trade options, then you should consider talking to me about my latest strategies. Visit my website, and I’ll send you a free video to get you started on the right path.

Learn Risk Free Insurance Option Trading System focusing on Max Safety & Max Reward Options Trading. You will only find this strategy in the San Jose Options Mentoring Course

Options Class Schedule

Did that calendar on the student site get wiped out? I don’t see the class schedule anymore.
No, I usually post classes a few hours or 1 day ahead of time. I like to base classes on the current market.

Thanks, see you in class!

Tonight’s Option Class

In the student account tonight we’ll be analyzing and adjusting this trade. I have attached an images of my new adjustment here. I couldn’t start the trade with very much locked in, but it’s still a nice trade which is up about $200 today. As time passes, then I can lock in profits while my positive Delta increases.

Thanks and have fun!

Adjustment Tips for the Day

November 30, 2009
I just posted a new Iron Condor that helps adjust my deltas and takes advantage of the spike in the IV. See the Condor board for that trade. Then I also closed out my previous RUT Condors using the rules we teach in the course. You might have slightly different RUT trades, etc., so do your analysis and then we’ll see you in class later today! Have fun.

See a Risk-Free Option Trade in Action!

See a Risk Free Options Trade in Action!

Hi everybody, I just wanted to take a moment to make a short video of one of our live trades to illustrate how effective and profitable one can be using the San Jose Options trading system. In this video you will see a live options trade which is currently yielding over 10% and has the potential to make realistically up to about 50% over the next two weeks. You will also see that this trade is virtually risk free. So with that being said, please take a moment to watch this video and see the potential that each option trader has if they get the right education. Have fun and good luck trading your options!

Risk Free Insurance Plays with Options

New Trading System by San Jose Options

WE JUST GOT BETTER!
We already had some of the safest option trading strategies ever taught anywhere, but one thing leads to another, and we just got even better!

RECENT DISCOVERIES
Recently, we’ve developed a Self-Adjusting trading system which in a few words is “Simply Amazing!” What we’ve done is discovered a way to trade with nearly Risk-Free Insurance. What this means is that the insurance we use to protect our trades virtually risks nothing if we do not use it. In a normal situation, insurance strategies lose money each month and eat up your profits, but we’ve designed a way around this problem!

FOR EXAMPLE
Let’s say you want to trade an Iron Condor, but you want to do this with insurance to the upside and to the downside. Well, 99.99% of all option traders only know how to design a trade where the insurance will eat up most of the profits if the Iron Condor is profitable.

With our newly designed Risk-Free Insurance Method, we can trade the Iron Condor with surrounding insurance plays which do not take away from the Condor profits. In fact, many of our insurance plays will also make money while simultaneously adding insurance to the position.

STUDENT FEEDBACK
Student feedback on this new strategy has been awesome. I am loving it myself. In all my years in the option educational field, I have never seen or heard of this technique. Students are saying that I invented this. They could be right, but all I know is that our new Risk-Free Insurance strategy is the best thing I have ever seen when it comes to trading options.