The right option trading class can make all the difference between success and failure for the serious trader. There are literally hundreds of courses and seminars out there, all claiming that they will make you a fortune if you follow their methods. But I have learned from personal experience that first impressions about options trading are the ones that tend to stay with you for a long time. If your initial approach to option trading is based on a system that doesn't fit with the kind of trading style you're best suited to, the result can be disaster.
For example, the simplest option trading system involves only the purchase of call or put options depending on where you expect the underlying price action to go within a few days. An option trading class like one conducted by supertrader Nik Halik will teach you about short term entry signals and chart patterns, which, if followed exactly, should result in about 7 out of 10 trades being successful. Combining this with stop loss, profit taking and money management rules - with a starting bank of about $10,000 you should theoretically be able to make about $1,500 per week and quit your day job ... theoretically.
But ... and here's the reality of it ... do you have the self discipline it takes for the two major components necessary to achieve success and not wipe out your trading account, using a system like this, which are:
1. Patiently wait for the exact entry signals to appear, which may mean there will be times when you might only enter one or two trades per week, if that.
2. Take your stop losses at the recommended limits every time.
Not everyone can do this. Some are distracted by their "day job" while others just can't bear the thought of accepting a loss (especially if it is your first trade) and hold on in the hope that the price will recover. More often than not, it doesn't.
Another option trading class I know about teaches you how to trade credit spreads. They provide an e-book and Excel spreadsheets plus historical data to help you paper trade historical charts. These have a different risk profile than simply buying options and are more of a longer term monthly strategy. But they do teach you the value of rolling your positions up or down - or even out.
But the best option trading class I have come across so far, is a set of videos that teach you two things:
1. How to take advantage of and profit from the one certainty about all options - they all eventually expire.
2. How to adjust your positions in response to price action, to avoid losses and maximise profit. This is the part that makes all the difference - learning the art of adjustments.
3. How to grow your wealth over time using a number of 'bonus' options techniques (covered in Module 11).
The videos are very professionally produced by a company that call themselves Tradingology. You get instant download access to them and they play on your computer using your default media player. All up, the viewing time is about 24 hours including bonus videos, but you can get the main gist of it after only a few hours viewing. The rest is about refining the technique - an aspect of the system not to be underestimated.
I have viewed most of the Trading Pro System videos and found them very exciting, as the profitability is very reliable and extremely low risk.
There is another option trading class produced by an organization called "Safety in the Markets" which focuses on using the techniques originating from the famous Wall Street trader W.D. Gann but this is quite expensive.
Some option trading classes focus on just one area of option trading such as covered calls - and you can find a covered calls coach to help you with this, or do a Google search for the Sharelord program run by Nik Halik. Covered calls strategies usually require a great deal more starting capital though.
In the end, the most important thing to remember, is to choose an option trading class with a profile that matches a trading style which is best suited to your available capital and what you know about yourself.
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