Intriguing Conversation about Option Trading
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As Option traders, we are all on a quest for that magical formula to making consistent returns on our trades. Along the way we trade stories and tips with other traders and some information really sticks with you. Something that stood out was when he said "Non-directional option trading doesn't mean we can make money in any direction. It means that we make money if the underlying doesn't move in any direction. In other words, it's still a directional trade, sideways." I couldn't agree more, and it's been advertised that it's easy to make money with options because we can make money on any direction. In some respects this is true, but in others it's not. If you're trading Iron Condors, you know what I'm talking about. Even more so if you're trading the Condors that most of the books teach. If you were trading that strategy in 2009, you probably didn't end up making anything. That's due to Iron Condors being just as directional as other option trades, just that it was a sideways movement. For some traders, it's just as hard to foresee a sideways movement as it is an up or down. Over the years, I've received many calls from traders loosing massive chunks of their accounts from trading condors and credit spreads. Sadly, it's always the same complaint; "It was going so well for several months, then all the sudden I lost nearly my whole account in one day." I've heard this time and time again, and it's about time something was done about it! 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 this problem San Jose Options Mentoring has reinvented Iron Condors and Credit Spreads. The less you have to adjust your condor, the better off you will be in most cases and we have a different technique which gives the underlying much more flexibility, lowering our stress level and keeping us out away from a disastrous scenario. In addition to our safer ways to trade condors, we've also come up with ways to lock-in our profits from them. The average option trader will exit the trade once they've made a profit. San Jose Options can lock-in our profits and we 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.