Appreciate all you do!! … TOC is one of the finest forum and source of information for all levels of trader from beginner to advanced. looking forward to the set !
Chris, I have always known you (thru this forum) to be realistic in your assessment of trades but your recent claims of teaching strategies that never fail and always make ’000′s of dollars is a complete U turn. We all know that no such strategies don’t exist. Are you OVER marketing your product? I suggest you go back to your old self and bring in some realism. There are always pluses and minuses in every trade. Tell us the downsdide. A trade that is too good to be true, it usually is. Run!
I have not claimed that any strategy is fail proof or that trading is risk free. The entire point is that any options strategy can and will lose money and that if you hope to be profitable over the long-term that you need to address that fact.
A lot of folks out there are teaching people to commit large percentages of their capital to one strategy. This is often an “all or nothing” approach. Either the trade works out and we have a good month or we experience a severe capital draw down because we can’t see the risks and don’t know how to mitigate them. Yet, it’s the way most retail traders approach trading.
The alternative is 1.) implement really good risk management, 2.) diversify your risk over several strategies, time frames, and underlying products, and 3.) develop a method of managing this portfolio of trades. The result is that you end up with some trades each month that make money, a few that lose money, and some that break even. If your management skills are up to snuff you’ll know when to cut the losers out from your portfolio, or adjust the position if appropriate, to keep the losing trade(s) from eating into the profits or your account’s capital.
You are also correct that there “are always pluses and minuses in every trade.” What that really suggests is that there is a good time to use some trading strategies and then there are times when there is a better choice available.
So, you ask what’s the downside? Well, if you implement the concepts that I’m referencing, despite a high probability of success each month there will be months when you break even or suffer a limited loss. How limited? That depends upon your risk management decisions, but the guidelines that I use are conservative and intended to keep me out of serious trouble. No doubt some traders will choose to get more aggressive in hope of earning greater profits and will take on more risk as a result. We must all find our balance in this.
The one reassuring thing is that the greeks don’t lie. They tell you exactly where your risk is and how to mitigate or eliminate that risk. It’s just then a question of how much risk you’re willing to have in your portfolio and how you want to go about managing it. You want to get long the market? Fine. How long? How about 100 SPYder shares? Too much? Add some negative deltas. Too little? Add some positive deltas. The trick then is to figure out how to add the positive or negative deltas. Long premium? Short premium? Perhaps the underlying? These are all management decisions.
That’s what the course is all about… Management.
I assure you that I have not changed from my old self. I can’t tell you how many SPYder shares you should be long or short. What I can do is show you some ways to get long or short delta, while keeping the probabilities of success squarely in your favor.
Now that I know that the voice on those videos was not yours, I am very comfortable. You are still the same realistic person I have known. I will be signing up right away! Apologies for the outburst on the wrong guy!
Very good video…Look forward to seeing the 8.
Excellent !! Chris..
Appreciate all you do!! … TOC is one of the finest forum and source of information for all levels of trader from beginner to advanced. looking forward to the set !
Chris, I have always known you (thru this forum) to be realistic in your assessment of trades but your recent claims of teaching strategies that never fail and always make ’000′s of dollars is a complete U turn. We all know that no such strategies don’t exist. Are you OVER marketing your product? I suggest you go back to your old self and bring in some realism. There are always pluses and minuses in every trade. Tell us the downsdide. A trade that is too good to be true, it usually is. Run!
Jay,
I have not claimed that any strategy is fail proof or that trading is risk free. The entire point is that any options strategy can and will lose money and that if you hope to be profitable over the long-term that you need to address that fact.
A lot of folks out there are teaching people to commit large percentages of their capital to one strategy. This is often an “all or nothing” approach. Either the trade works out and we have a good month or we experience a severe capital draw down because we can’t see the risks and don’t know how to mitigate them. Yet, it’s the way most retail traders approach trading.
The alternative is 1.) implement really good risk management, 2.) diversify your risk over several strategies, time frames, and underlying products, and 3.) develop a method of managing this portfolio of trades. The result is that you end up with some trades each month that make money, a few that lose money, and some that break even. If your management skills are up to snuff you’ll know when to cut the losers out from your portfolio, or adjust the position if appropriate, to keep the losing trade(s) from eating into the profits or your account’s capital.
You are also correct that there “are always pluses and minuses in every trade.” What that really suggests is that there is a good time to use some trading strategies and then there are times when there is a better choice available.
So, you ask what’s the downside? Well, if you implement the concepts that I’m referencing, despite a high probability of success each month there will be months when you break even or suffer a limited loss. How limited? That depends upon your risk management decisions, but the guidelines that I use are conservative and intended to keep me out of serious trouble. No doubt some traders will choose to get more aggressive in hope of earning greater profits and will take on more risk as a result. We must all find our balance in this.
The one reassuring thing is that the greeks don’t lie. They tell you exactly where your risk is and how to mitigate or eliminate that risk. It’s just then a question of how much risk you’re willing to have in your portfolio and how you want to go about managing it. You want to get long the market? Fine. How long? How about 100 SPYder shares? Too much? Add some negative deltas. Too little? Add some positive deltas. The trick then is to figure out how to add the positive or negative deltas. Long premium? Short premium? Perhaps the underlying? These are all management decisions.
That’s what the course is all about… Management.
I assure you that I have not changed from my old self. I can’t tell you how many SPYder shares you should be long or short. What I can do is show you some ways to get long or short delta, while keeping the probabilities of success squarely in your favor.
Christopher Smith
TheOptionClub.com
Chris,
Now that I know that the voice on those videos was not yours, I am very comfortable. You are still the same realistic person I have known. I will be signing up right away! Apologies for the outburst on the wrong guy!
Jay