What if I told you there really is a secret to being a successful trader?
What if I told you it was about as secretive as Liberaci’s bachelorhood?
There are a lot of ‘secrets’ here at Option Pit Mentoring that really aren’t secrets. One of these ‘secrets’ most traders want to know is: What are the steps necessary to become a successful option trader?
Believe it or not I do not think becoming successful at trading is that hard, when given the right help. In practice, trading is difficult, but the actual tactics and strategies we teach at Option Pit Mentoring should be understandable to all traders:
- now the Market: by evaluating things like vol levels, skew , term structure and other market conditions traders can pinpoint what trade is most likely to win. This is a lot of what I teach like during our special Event on January 14th.
- Evaluate underlying securities: compare similar underlying products to find the most favorable stock or index for the trade that you think is going to be the most favorable.
- Know the product you are trading: do not trade an ETF or index that you do not know understand. Dear Lord so many people do this and it’s the exact reason why institutions around the world ask my opinion on especially volatility based instruments. I have no sympathy for those who got railroaded by the “vol-pocalypse.”
- Be Specific in the trade: once the trader knows what kind of trade they are looking to enter, and what stock to trade it in, the trader should structure the trade…the right way. Many either over simplify, or over think a trade set up. And yes sometimes simple is better which is why in my Special Live Event, I’m distilling all the complication to the simplest trade that can double your money.
- Have a profit target: THIS SHOULD BE SIMPLE…HOW MUCH MONEY ARE YOU TRYING TO ACTUALLY MAKE
- Know your position: I am shocked by the number of traders that do not know what they have on at any given time. If I ask my students what their position is, you better believe they know what their position is.
- Understand the risk of your position: This means that you know how changes in volatility, price, the passage of time, skew and term structure will affect your risk. Remember the Greeks are not real; they only represent what your trading platform THINKS your position might do under changing conditions. We teach traders how to understand risk to be better at evaluating their position than a trader only using the broker platforms.
- Understand how much a trade is down or up: it’s a simple thing to know, that many neglect to keep track. It’s great to have a target, but you have to KNOW if you are at your target.
- Have a breaking point: it’s okay to kill a trade: traders that decide that a trade is a loser and exit usually avoid getting into real trouble. MASSIVE SECRET – If you can’t decide if a trade is a loser, then let your P&L do the talking. When you hit a max loss kill the trade
Most people are aware of what they need to do; they just don’t do it, or don’t know how to do it. That is why we are here. Option Pit is here to help you, the retail option trader, trade with a disciplined approach. Newer traders should learn the right way to trade from the start. More experienced traders should fix problems before they come too big to handle. Pro’s, if you need to improve volatility knowledge there is no better place then Option Pit.
The best way to start is with our live event, “Double Your Money in 2020.”i