Frequently Asked Questions
There's so much. Where do I start?
As with many things, the best place to start is at the beginning. If you are new to options you will want to familiarize yourself with option basics so that you understand the underlying product that you will be trading.
Assuming a basic understanding of options, you will want to download the videos for Module 1 and begin there. Work your way through the other modules. Supplemental materials are also provided, which may help "fill in the blanks" if you're struggling with a particular concept.
Still seem overwhelming? Help is available in our member's forum. Select the appropriate section and post your questions. We also have regular live group trading sessions where you are encouraged to ask questions, as well.
I Got A Message That I Exceeded My Download Quota. What's up?
We implemented a daily download quota shortly after the Trading Room opened because a few people were using automated download programs that would download everything at one go. This kills the bandwidth and causes some real problems with the server, which makes it difficult for others to log into their accounts or to access material on the site. In some cases the security software was being tripped resulting in people being unable to access the server at all.
When we implemented the daily quota it was set at a high enough level (30 files per day) that a member can literally download so much video content that they could not watch it within a 24 hour period, by which time the quota would reset. So, the idea was that by the time you actually watch the materials that were downloaded you can start downloading more stuff.
What the quota is not intended to do is restrict your access to any specific material. It’s just there to regulate bandwidth and server resources.
About a year or so after opening the Trading Room we upgraded the server that hosts our site. At that time we increased the download limit to 45 files per day. We continue to monitor the server resources and allocate as much as we can to our members.
I have a Mac. How do I play the WMV videos?
If you have a Mac, you can play the .WMV video format with Windows Media® Components for QuickTime, by Flip4Mac™, directly in the QuickTime Player. Learn more here:
Another solution is a free video player download called VLC Media Player, which you can get from several sites including CNet Download:
Which broker(s) do you recommend?
I do not recommend brokers. Personally, I trade almost exclusively with ThinkOrSwim. I have tried a number of brokers and they offer what I have found to be the best combination of options savvy support, a best-of-breed trading and analytic platform, and reasonable cost structure.
They are not the cheapest game in town, but they deliver a lot for the commissions they do charge. If you are inclined to open an account with them, feel free to use my name and mention TheOptionClub.com, then ask for our special commission rate which is $1.50 per contract with no minimum or ticket charge. They'll set you up and once you fund your account you'll have access to their software and their services.
Do I Need Special Software?
You do not need any particular piece of software. You will find that most of the videos feature the ThinkOrSwim trading platform, which will provide you with all of the features you might require for most of the income trading strategies, but it is not a necessity.
What you will need is the ability to review your option positions' greeks. A good options broker will be able to provide you with this information through their trading platform. If your broker does not provide that information, there are many third party programs that provide this information as well as analytics.
My preference among the third party software offerings is OptionVue. It is the finest third party options analysis platform I have found. It is not cheap, though. I am an OptionVue client, I do have to pay for my software as well as the data feed. The reason I pay for it is because it's worth the money.
The one feature that OptionVue does not have is the ability to beta weight the portfolio. In my opinion, this feature has limited application in the context of individual stocks but can be helpful when trading broad market products like the SPYder or IWM. Aside from portfolio beta weighting, OptionVue doesn't miss a trick and offers several features that you cannot find on the TOS platform.
How Much Capital Do I Need To Trade?
Not much. In fact, I suggest that you limit yourself to no more than $5,000 until you are able to trade for a few month without losing money. Just limit your trades to one or two contracts, keeping your position sizes small.
One of the reasons I got the $1.50 contract rate with no minimums or ticket charges is so that you can afford to trade one or two contracts. Small size means small losses! Trust me, you will lose money when you first start trading.
At some point as your skills develop and you learn to control your losses, you'll find profits creep into the picture. Maintain that for a couple months and then ease your account size and position size up a notch.
The bottom line is that if you are losing money with a $5,000 account you will lose even more money trading a $50,000 account. Stay small. Lose little. Increase your trading size only after you have achieved profitability, but do so gradually. Make yourself prove to yourself that you can stay profitable before committing more capital.
By the way, if you don't believe it's possible to trade multiple options positions in a small $5,000 account, I am doing it and tracking all of the trades in our forum and during our live group trade sessions. The goal is to just break even for several months, which means that you're not losing money. Learn how to not lose money, the profits will come.
Don't believe me on that one? What are Warren Buffet's top two trading rules? Well, the first one is "1. Don't Lose Money." What's the second? It's "2. Don't forget rule no. 1."
When Are The Live Events?
Live events are scheduled routinely on the Calendar and are typically announced in the News section. To learn when our next live event will take place, just click on the "Calendar" tab after logging into the Trading Room. From there you will be able to see all scheduled events and obtain information about attending.
What Are One-On-One Sessions?
One-On-One sessions are offered to members who feel that they need a little extra help understanding the concepts covered in our training sessions. The One-On-One session is conducted in an on-line "meeting room" with two-way voice communication. The sessions are recorded and will be added to the Download section.
If you would like to schedule a one-on-one session you must 1.) have paid the initial licensing fee and have been a member for at least 30 days, 2.) you must have an active account, and 3.) you must consent to having the session recorded. All recordings are the exclusive property of Christopher Smith and TheOptionClub.com.
Use the "Contact Us" tab at the top of the Trading Room page to request a one-on-one session. Specify those topics you wish to discuss when you submit your request so that we might be properly prepared. All sessions are scheduled at our discretion and we have the absolute right to refuse to schedule a session.
We will NOT provide trade advice and any demonstrations of option trade positions, position adjustments, or strategies are deemed to be hypothetical in nature. All option strategies involved financial risk. It is your responsibility to consult with your financial professionals and evaluate any positions before executing a transaction.
Is There A Trade Advisory Service?
No. We do not presently offer a trade advisory service and do not have current plans to add such a service. Our goal is to help you learn how to trade your own account without the need for such a service.
However, we understand that benefit of being able to "look over the shoulder" of another trader who is applying these concepts. In an effort to provide such an experience we are trading a small portfolio using the monthly income trading concepts presented here. You can follow along with those trades in the "Income Portfolio Trading" section of the member's forum.
How Do I Get Help With A Trade?
We are not investment advisers and do not offer investment advice. This is an educational forum intended for the purpose of exploring the concepts of monthly income trading and portfolio management using options to control risk and create profit opportunities.
If you would like to discuss a trade, you are more than welcome to do so in the member's forum or at one of our live group trading workshops. We can explore potential position adjustments and trade management techniques. Ultimately, how you choose to manage the position is up to you.
How Do I Cancel My Membership?
You may cancel your membership at anytime and you will not be billed further. Once you do cancel, your membership will remain active until the next scheduled re-billing period. At that time you will not be charged and your account will stop functioning.
To cancel a membership if you are being billed through PayPal, just log into your PayPal account and find your original transaction record. From there you simply click on "cancel" and you will not be billed further. Your membership will continue to remain active until the next scheduled billing cycle at which time it will automatically expire.
If you are being billed directly on your credit card, you can cancel your membership by logging into the Membership Information. Use the same user name and password that you use to access the Trading Room.
In the lower right hand section of your Membership Information page, you will see your payment history. There is a blue "cancel" link displayed there. By clicking on the link you will stop future billings, your membership will continue to remain active until the next scheduled billing cycle, at which time it will automatically expire.
Can I Get A Refund?
If you paid the full initial licensing fee, you may cancel your membership within the first 48-hours and receive a full refund of that licensing fee. There are no refunds after the initial 48-hours.
We do NOT provide refunds for the monthly membership fees. We do NOT prorate monthly membership fees. You may cancel your membership at any time and you will not be billed further. Your membership will remain active following cancellation until the next scheduled re-billing period.