Consistent Returns With Option Trading
I am one of many option traders, folks, in search of a magical way of making consistent returns from our trades. I was talking to a fellow trader today who said something profoundly familiar to me.
He really caught my attention when he mentioned that "non-directional option trading" doesn't mean we can make money in any direction. That it if fact meant that we make money if the underlying doesn't move in any direction. That it was technically still a directional trade, only sideways. It is put out there than it's easy to make money with options because we can make money on any direction. This may be true in some situations, but not so much in others.
In 2009, if you traded the Iron Condors most courses and books taught, you probably didn't end up making hardly anything. That's because the Iron Condor is just as directional as other options trades because its direction is sideways. It can be just as difficult to predict a sideways movement as it is an up or down.
I've heard many people's plights over the years about losing huge chunks of their accounts trading credit spreads and condors, and it's always the same situation... "It went really well for several months, and then I pretty much lost my whole account in one day." I've heard this so many times and frankly it's getting old.
Therefore, I decided I wouldn't teach traditional Condors and Credit Spreads. Using them will end you up a few days from expiration, with the RUT is right at your short strike, because you traded the way most people traded these strategies. Soon you'll be telling your sob story to your friends and trying to hide your financial travesty from your wife! This is no laughing matter. It can happen to anyone, including you. Is the stress really worth sticking to traditional methods?
In response to these problems, San Jose Options Mentoring has changed the approach to Iron Condors and Credit Spreads. We've developed new techniques that will allow the underlying more wiggle room, lowering out stress level and keeping us out of those dangerous situations. Remember, the less adjusting you have to do to your condor, the better of you'll be in most cases.
So you know we have a safer way to trade Condors, but we've also developed great techniques to lock-in our profits on them. Normally option traders exit their trades when they make a profit, but we can lock-in our profits and stay in the trade.
When you get right to it, if we ever have a Condor move against us, then we have developed a backup plan which gives us a free bonus trade! So, even though we may experience an undesirable month, we still get an excellent, free trade while most traders just take the fall and crawl away.
In the best of days and worst of days, we stand by the techniques we've developed in the Iron Condors and other Strategies.
Article Source: FxTradingStock.com
About the Author
Learn about Maximum Safety, Maximum Reward Option Trading at www.sjoptions.com. Don't be the next to tell your spouse that you lost it all on one bad Option Trade !
by: Donald Scott
Total views: 30
Word Count: 513
Date: Sat, 29 May 2010
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