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Options Trading in the Real World:2020

 — #options#trading#COVID-19

Aut Disce Aut Discede….. Non-Semper erit aesta. (Either learn it or leave summer won't last forever.)

Until of late the world of Options Trading didn’t seem to inspire grandiose optimistic write-ups or blog-post, saturated with unicorn glitter lead with unyielding blind faith that other trading vehicles have became a custom to sometime. i.e.(crypto trading, pink sheets aka penny stocks, Pokémon cards & of course Transformer Gen-1 action figures from the 1980s )

Option art

Everyone you know and their mother knows the stock market has been insane in 2020. The options markets are no different, premiums can be alarmingly expensive, IV is often parabolic, contract volumes are extraordinary, the O.I. on strike prices are the tell all, all well you pay the theta and beautiful time decay runs its course.

But now, in the COIVID-19 era of trading, the RobbinHood Cowboys mixed in with the Autistic savants of r/WallStreetbets are at center stage Options have become the hot trading vehicle of 2020. Fortunes have been made, lost, and gambled away. We have all read the stories or seen some of the action on, twitter/reddit post.

Robinhood Trader's Suicide Is Warning For Millennial Investors "I had no clue what I was doing..." That was Alexander Kearns' last words scribbled on a suicide note. During the…

Personally I have noticed a lot of bullshit recently, 1000 times more than the normal amount, when it comes to “experts in options trading” or “secret systems”. As someone who has been trading options on daily basis for 10+ years, And what I consider professionally for five years. I love and feed off this insanity, so much. Novice/clueless people, I thank you for buying my covered calls at outrageous premiums or getting shook out when the (bid x ask)’s are haywire from spoofing, then like clockwork the spoofing subsidies and FOMO kicks in making people panic buy contracts at the Ask price allowing premiums to gain 100% in minutes. (Thank you)

Then factor in all the noise, Twitter, Stocktwits and my favorite the Trading “Guru’s”, Coach” or whatever bullshit name they have branded for themselves. Talking piles of shit, trying to hustle you for a monthly/yearly subscription to a trading chatroom or sell their secret system that will give you the ultimate edge. If you dare subscribe to one of those rooms you will find just a bunch of other idiots looking for answers from someone like you. Remember no one knows a thing in reality the stock market is real time.

But Dad I need the tips and tricks I don’t know what I’m doing these guys want to help make me rich!! … Are you that naive ???

Let’s get real for a second here, the life of an active seasoned retail trader or professional trader is not for the faint of heart, particularly if you’re trading options. whether you are developing your own strategy systematic models or a discretionary trading Strategy. It can be a hard racket especially if you are trying to establish yourself on a personal bankroll. Then add in the psychological factor of fear, uncertainty and unpredictably because now Self-reliance is 100% relying on numero uno aka YOU.

Think about this, most “professionals” or independent options traders who have success at it, are essentially degenerate gamblers. Competingwith bots, sharks and big-money who can move the market or draw lines in the sand. The systems, ideas, model’s or theory’s they use to make a living are their life blood. Why would they share that with you and want to give you an edge to make you rich? Out of generosity the altruistic purpose of capitalism? please…

Advice for New/Aspiring Traders and some Truth:

affirmation

Trading isn’t for everyone — often it starts as an innocent idea for most. But then a hot tip from the top trending ticker of Stocktwits, then a profitable quick trade, maybe netted a few c-notes, and the squirrel who lives in your backyard also made. Fast forward 2 weeks after you quit your job to follow your “dream”, 6 computer monitors later, a microphone that can hear the neighbors cat piss, an investment of course for promising Youtube/podcasting career about investing and trading and endless posting on Instagram/Twitter, words of affirmation for self made entrepreneurs. The next week or so this person finds out the hard realities of trading. After their premarket prep of drinking some cold-pressed juice, meditating(heard it on a trading podcast) and thinking of the altruistic lifestyle they plan to lead as the success of trading continues. BOOM💥! They go bust that day account to zero, blindsided by what was right in front of them.

This is what really is happened you are gambling! Most, likely rent-money or $2000 you saved from unemployment stimulus. Completely unprepared just like the rest of your life, only resources you ever looked in where a few Youtube videos and the Robbinhood daily email. wrong? Want to know my secret?

Someone out there will always be looking to fuck you for your money. They are 10 times smarter than you, have a bigger dick, and a tighter asshole.

Like I said earlier, I’ve have been trading options for 10Yrs, the first 1–4Yrs where the ugly learning years I blew up accounts, lost thousands made mistakes. 4.5–7yrs I still had a full time job, but started making more than my yearly salary trading. Now 7–10yrs a independent professional level meaning, I do not need another source of income. 2019–2020 has been my most profitable year ever trading. I’m willing to share my trade sheet to prove it. I’ll quickly go over my most recent trade which was on Friday, September 4th 2020. After a two day sell off after all time highs again two “tech/customer product” companies met my model.

chwy etsy gains

CHWY & ETSY no need for a detailed history. But after They came into my radar that morning and having been on my watchlist for a while, these two strikes stood out to me. (CHWY 9/18 70C) & (ETSY 9/11 120C) I picked a price target for both of them CHWY was $56.00 and ETSY $103.00 selling continued off the bell but math presented its self. Set a stop loss of 15% part of my model.( It’s not a loss if it’s part of a plan) Now I know, I’m not going in to all the details of the model, indicators etc. But you should know a lot of successful systematic model based discretionary trading decision are made by critical thinking, timing and realizing you can’t kiss every baby or ride every trade. Emotions will rule you while trading, try to think in boolean like statements is this True or False.

I excited this trade the same day, maybe I left some on the table but I stuck to my targets and took profit. There are great resources available for options trading on a variety of platforms from opinion’s, education, and complicated algorithmic theories.

i.e. https://www.investopedia.com/terms/b/blackscholes.asp

i.e.(https://www.tdameritrade.com/education/account-types-and-investment-products/how-to-trade-options.page)

i.e.(https://github.com/QuantConnect/Lean)

These resources aren’t solving the problem that people seem to be having. That problem is solved by time and effort to learn. Also taking profit helps…

nicholas-cappello-Wb63zqJ5gnE-unsplash.jpg

Stay humble, keep learning remember it’s survival of the fitness each day. Be smart use stops, set limits, pick price targets and take PROFIT! If you are up 100% on a trade maybe don’t sit on it

Lastly, live to trade another day and not to get your face ripped off.

Nick