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Philosophy and Goals of Trading

I am of the opinion that trading stock options can and should be a lucrative business venture. Unlike buying and selling stocks, which only gives you one direction (and if you are short a stock, this is the ultimate risk), trading options gives someone the ability to choose from an assortment of possibilities regarding direction, anticipated price movement, the ability to trade neutrally, and most of all… leverage.

If you are looking for credit spreads, this is not the site for you. I do not like them, as I have seen so many option trader’s over the years lose their shirt on them. Instead, I use my experience trading options to make calculated risks.  I can assure you that if stick to a discipline that I teach and post when trading options, you will be successful. I promise that to you.

I am not about quantity of trades. I am about the quality of each trade and the percentages of the trade being successful, and exiting as quickly as possible. I carefully choose each trade I make. Many option traders fail because they have what I call the “trigger finger” effect, meaning that they don’t really care what they are trading, as long as they are. This can lead to disastrous results. I am extremely patient when using my Daily Options Trading Strategy to spot, pick, and place trades. I follow a select number of stocks, which I always update here on my website. I currently use four (4) tiers, nine (9) stocks on each Tier. My subscription service provides you the comfort of knowing that you are trading what I am, in real-time. There are no delays or late e-mails here. This is truly live trading.

Before each trade, well ahead of each placement, I will provide you the ticker symbol, strike price, expiration date, my sell-to close order price, and eventually post when the trade has been closed out. The chatroom I have is full of traders who I personally know have been with my subscription service for years, and also new trader’s. I encourage conversation daily, as this will only expedite the learning process. My service is unique in that I not only provide you with my trades in real time, but I am also conversing with all of my subscribers all day.

To give you an example of an average Daily Options Trading Strategy trade, here is a set-up and trade we see and make daily:

  • Buy 100 TWTR $25.00 call options @ $2.00/contract. With a sell to close order $0.20, this is a 10% winner when you have the sell-to-close at $2.20. Minus the commission costs, this is still around 8 +% (depending on your commission costs). On average, most trades will generate 5-10%. This strategy is so consistent that each day, with these daily winners, your account will increase substantially in a relatively short amount of time.

I understand everyone is working with a different amount of trading capital. But whether you are working with $30k or $1 million, the winning ROI percentage remains the same per trade. Patience is key here. The ability to spot true lows or true highs, and the exit the trade quickly, is the basis of the strategy.

The same goes for my earnings and weekly trades. For example, lets assume there is an earnings trade coming up on a short week where very few companies are reporting during that particular week. I am not going to recommend a trade just because there is nothing else to trade. This is reckless, in my opinion. Yet, I see it all the time. Instead, I would rather use the capital available (increase if suitable) on a trade that I feel has a very high likelihood of producing a winner. This is a discipline that is hard to teach, but that is what I am here to help you with. The strategies I use provide extremely high returns. On any earnings trade, I refuse to take a one-sided approach. I learned early in my trading career that to go only bullish or bearish on an earnings trade is a recipe for disaster. There is simply no way to predict which way a stock will move post-earnings. You will often see a company have blowout earnings, beat the estimates, raise their guidance, and yet the stock still tumbles, and vice versa. You may get lucky and guess right on an earnings trade by choosing to buy calls or puts, but I can’t emphasize this enough: The only way to successfully  trade earnings long-term is to take a neutral approach.

If you have nay questions, please e-mail me at kmob79@gmail.com or info@kevinmobrien.com.

 

 

2 Responses to Philosophy and Goals of Trading

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