fbpx

 

When you hear of someone making 1000% on a trade, they are usually talking about a recent win on trading options.

But that is the farthest thing from what really happens when you’re using options

According to the CBOE, 80% of all options expire worthlessly.

This means that 80% of the time, Options traders make no money on those positions if they are held until expiration.

Now I am not sure about you, but I don’t want to be trading where I’m guaranteed to lose 80% of the time!

Instead, I would much rather go to a casino where I could at least get close to 50% on Black Jack

So what did I do?

Rather than BUYING options, I am going to focus on SELLING them!

That’s right, I am then able to get the odds of profits up to 80% and huge returns that can be 100% or more!

Ready to learn more and have the truths revealed about this feared options strategy?

Now that’s exactly what I did on a recent trade where I was able to leverage a typically feared nuance of options and turn this into a powerhouse strategy where I can make over 100% ROI on my trades.

Let’s take a look at how I combined technical and fundamental with a killer option strategy for huge gains in this stock.

 

A Strategy For Generating Income

 

No matter the direction I think the stock is going to head, there is always a strategy that I can choose from to trade.

Either up, down, or sideways, there is always a strategy that you can use when trading credit spreads.

Some of my favorite strategies are :

  • Credit Put Spreads
  • Credit Call Spreads
  • Credit Puts
  • Covered Calls

And for me, I found that I need to be selling credit spreads that generate income for my trading business*.

I knew that casinos and successful traders have a well-defined edge in the markets, and I knew that I needed to find the same thing for myself.

 

How Short Credit Strategies Puts Me Ahead Of The Competition

 

My edge comes from reading Fractal Energy and the technical indicators that comprise Options Profit Planners trading system.

And this allows me to have win streaks that are nearly perfect since last year with only a handful of losses*

The thing is… many strategies require traders to be at their screens all day tracking their positions.

But instead, this strategy is developed to allow for me to only spend a few hours per week managing the trades I put on my account

And in order to generate income and put the odds of the casinos to work for me, I focus specifically on selling calls and puts.

But of course, I am willing to own every stock I trade so I will occasionally let positions exercise in order to get even larger profits on my trades over a longer period of time.

Let me explain why this happened in a recent trade of mine, and how I used this opportunity to generate extra returns for my trade.

Moving on…

 

Why I Took The BOIL Trade

 

At a technical level, BOIL appears to be a great setup for me to trade.

It checkmarks my 3 technical boxes that I need to enter a trade

  1. It’s trading below its lower Bollinger Bands
  2. The Fractal Energy is depleted, meaning it can’t sustain its current trend
  3. It had a strong rebound, and I can use the recent low as my hard stop exit.

And that’s exactly what I did with my trade and started selling Puts when the chart was reading $30.

Now you see, when trading naked puts, I always know that I carry some extra risk with my trades

And that’s ok with me since I am taking stocks that I feel comfortable with investing in.

You see, I only trade stocks that meet my strict fundamental requirements to be sure I only own trades that I know will be a smart investment

Now I knew this stock had a split that was coming up soon and I felt comfortable when the stock started trading down near my short put level.

 

Source: Thinkorswim

 

How I Took Ownership Of BOIL

 

But then a short put traders worst fear happened next before I took the trade-off.

For many traders who don’t use fundamentals to select stock this might be a nightmare, but not for me!

You see, I carefully select all stock based on strict fundamental criteria in order to make sure I am trading and investing in the best possible stock out there for me.

And when I was assigned ownership in the stock and then the split occurred, I felt totally confident knowing that I was owning a quality stock both fundamentally and technically.

So what happened?

At this point, the split and adjustments caused my breakeven to move to $36.23.

And I was ok with holding this position until my target price was hit.

Now… this is when a trader can even get more aggressive in their position and do a few different adjustments to their trade.

They could:

  • Sell another put, and collect more income
  • Sell a call, and create a covered-call to collect more income
  • Buy a Put, to protect from further downside risk

But my plan is to simply sell my shares when it gets into the upper $40 to low $50.

So what happened?

 

 

Source: Thinkorswim

 

 

As you can see, the stock rallied a massive 30% from where I was assigned.

And since I was selling a naked put, I was able to generate income on top of extra returns on the stock after I owned the stock.

What exactly happened?

  • I collected 100% of my sale on those puts
  • I generated an additional 30% on the equity of my stock

Combining the ownership of both options and the stock position, I was able to return a fantastic 130% ROI on this investment in just a few months!

Now, I know you are wondering… Can this even work for me?

Well, I think it works for me and it could be a complete game-changer for your trading!

Just check out some of these wins, astrategy that puts the odds of the casino in your favor, and one of the highest-conviction trade idea service produced

So let me ask you these three questions:

  • Do you like to generate income instead of gambling on every trade?
  • Do you want to trade with the odds of success the same as the casinos?
  • Do you need to only trade part-time but still earn full-time returns?

If you’ve said yes to any of these questions, then trading credit strategies is what you need to take your trading to the next level.

Now if you are ready, take Options Profit Planner for a spin… and if you join now, you’ll receive my next best trade ideas tomorrow!

*Results presented are not typical and may vary from person to person. Please review our full disclaimer located at ragingbull.com/disclaimer.

 

Author:
Dave Lukas

2 Comments

  1. I didn’t get to watch or listen I only have my phone & terrible service at the moment. I traded Options a while ago, never got to do it like I wanted, due to I ran my Uncles multi- Million Dollar Restaurants!
    I did Have a long talk with my mother at the time and just got, “but what if You lose Everything, and your Uncle needs you etc. Not the Confidence in me I was hoping forI
    I did this like in 2004 or 2005. I bought a program that I could plug in the parameters or #’s in my Known (personal Area That Works) Something a bit kinda like u mentioned!
    I worked crazy hours in that business & didn’t put the time I would of liked in it, but Soon by Just using this system, Knowing what to look for/ or what I’d like to see that all falls in my possible area to Look into it further, & Charts it out up to the second!
    The Program I bought back then after a 2 day Seminar to learn about All the crazy ways to make money in Options, Up, down or Sideways lol! It was called “Options Made Easy”! As long as I trusted what I was seeing, which I Did, and just Did what I knew worked and didn’t.stray from how I was told to proceed. I Simply Used the system like I was taught, all without Getting greedy or think I could try something and make more $.
    I was making more trading Options @ (45 minutes average a night) within weeks! A good bit more than I made Being a Top Manager With 6 Restaurants I controlled myself. I couldn’t believe it, and loved Everything about it!
    I found myself Really feeling inside that It’s what I was supposed to do! Wanting to spend more time & to learn more! I Was ail burnt out from Managing and opening New “Upscale” Restaurants & traning / teaching Hundreds of new Possible Staff of all types and Managers. First 2-3 years I Didn’t take 1 day off, or Anything! I did it cause It came pretty easy for me, & If I didn’t do what I did I don’t think he feels this way, but I know and so did many orhers, that If I didn’t do what I did for My Family / Uncle. It wouldn’t of worked period
    With the System I could practice learning as well by using The systems training, that you could Purchase Options With the program using training $. It was a nice tool to try the harder type Option Trades, and learn them, see if they were for me.
    Anyway, I had to stop, cause I was making more in a few measeley weeks/ month or 2, not even putting 8 hours a week in. I found out what worked for me, and Truly Enjoyed it! I just knew if I would stick with it I know I’d be Able to help family, & other people in need etc Which is what I feel I’m supposed to do If I ever get to that type of income Again!
    I Truly feel / I KNOW I can! Especially with a “Senseí” or Someone I could get a crash course from. I just never had anyone teach me or show me Anything about Stocks & Options. Besides the Course I took Witch was a room full of people.
    I am Truly Sorry to Ramble on and write so much, But I would like to talk further! I know you probably teach many with your talks and the system you use, & I’m sure most in your type of position surely do not want to have someone watching how they are doing things and asking Questions etc.
    I do Appreciate your Time , & if you read this All, I do thank you! Hope we can talk sometime here soon. I have a few Questions I’d really like to ask before I would be able to Possibly Really commit myself to trading or possibly look for someone to teach / work with me.
    I Do hope we talk and You can understand my rambling on lol. My Apologies Again! All the best to you no matter what, & Please do stay safe!
    BLESSINGS!
    Dave ✌🏼🍀

    1. Hey there Dave!

      Thank you so much for your message and interest in RagingBull! We have multiple options services that you may be interested in. Feel free to call our VIP Client Services team at (833) 265-1270 to discuss your current position and how you would like to move forward!

      We are looking forward to hearing from you!

Leave your comment