2023 marks our 12th year as a public trading service.We closed 192 winners out of 282 trades (68.1% winning ratio).Our model portfolio produced 112.2% compounded gain on the whole account based on 10% allocation per trade.We had only one losing month and one essentially breakeven in 2023.
Our readers know that our returns have been tracked by Pro-Trading-Profits, an independent third party website that tracks performance of hundreds investment newsletters. They provided an excellent explanation how to analyze and compare performance of different trading systems.
Let’s start with the obvious: if you can’t predict market trends, you’re playing pin the tail on the donkey with your, or worse, someone else’s investments. Reading market trends isn’t about gazing into a crystal ball; it’s about understanding economic indicators, market sentiment, and, occasionally, why everyone suddenly loves avocados.
A backspread is very bullish or very bearish strategy used to trade direction; ie a trader is betting that a stock will move quickly in one direction. Call Backspreads are used for trading up moves; put backspreads for down moves.
A long put option strategy is the purchase of a put option in the expectation of the underlying stock falling. It is Delta negative, Vega positive andTheta negative strategy. A long put is a single-leg, risk-defined, bearish options strategy. Buying a put option is a levered alternative to selling shares of stock short.
A long call option strategy is the purchase of a call option in the expectation of the underlying stock rising. It is Delta positive, Vega positive and Theta negative strategy. A long call is a single-leg, risk-defined, bullish options strategy. Buying a call option is a levered alternative to buying shares of stock.
Delta hedging is an investing strategy that combines the purchase or sale of an option as well as an offsetting transaction in the underlying asset to reduce the risk of a directional move in the price of the option. When a position is delta-neutral, it will not rise or fall in value when the value of the underlying asset stays within certain bounds.
A diagonal spread is a modified calendar spread involving different strike prices. It is an options strategy established by simultaneously entering into a long and short position in two options of the same type—two call options or two put options—but with different strike prices and different expiration dates.
Gamma scalping is a sophisticated options trading strategy primarily employed by institutions and hedge funds for managing portfolio risk and large positions in equities and futures. As a complex technique, it is particularly suitable for experienced traders seeking to capitalize on market movements, whether up or down, as they occur in real-time.
Everyone knows the statistic - 95% of traders fail.Whether or not that's an accurate statistic, it's certainly true that few that attempt trading ever make life-changing money. Part of that is because most don't take it seriously. But what about those that do and fail?
In options trading, a long call and short put both represent a bullish market outlook. But the way these positions express that view manifests very differently, both in terms of where you want the market to go and how your P&L changes over the life of the trade.
Building wealth is a lifelong aspiration for many people, yet it’s frequently regarded as reserved for a select few. However, this perception is not entirely true, especially when it’s possible to accumulate wealth and live an abundant life.