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The New Investment Strategy

News equals noise. When are people going to get it?

The news means absolutely nothing to me as an options trader. The entire industry has been commoditized. When I say the news is commoditized, I mean it's all the same. You can't differentiate one headline from another.

Why? Technological innovation.

News is widely accessible and therefore basically the same everywhere. The only difference is how they market themselves and as a trader I just don't care about their marketing techniques. Nor do I care about the news that they spew out on a daily basis. As an options trader it doesn't matter to me.

Fear is what sells. It's all over the news, every day, every hour, every minute. And while I do care about the macro-picture for my own self-interests, it too doesn't affect how I trade my options strategies.

But, what I do like about fear is that it creates opportunities. Opportunities to sell options at higher prices. Because with increased fear comes increased implied volatility and with increased volatility come increased options premium. And that is what I want to see as a seller of options.

I also like this type of market because it creates incredible swings and therefore, short-term overbought and oversold markets.

But again, the fact that fears sell is humorous to me. The masses just don't seem to get it. While they complain about the fear mongering they feed of it. They tell you to buy or sell certain sectors or certain stocks. A fool's game in my opinion.

What I never hear is that you can use a particular options strategy to take advantage of the fear that is currently in the market. You will never hear the market is in a short-term overbought state so now might be a great time to buy some puts in .. You will never hear that you can create a high-probability trade with an 80 to 90 percent chance of success that has a 10-15 percent return on the trade over the next 30-50 days. It just doesn't happen. Why?

We don't hear these types of statements from the financial media for the simple reason that they don't sell. They're boring - and most members of the media think they're too complicated.

But I know my subscribers are capable of understanding high-probability trades and how they work and more importantly how to manage the risk of each and every trade they initiate.

I'll never stop trying to convey my so-called BORING message that I can create options strategies with the type of advantages I speak of. I am not doing anything magical. No secrets here.

So, the question is, why can't the financial media teach the masses about such incredible strategies? Who knows and quite honestly who cares?

In my opinion it is their loss and our gain. I don't want these strategies to become mainstream, because when they do, they too will be commoditized and that is the last thing we want.

If you haven't already, I hope you will join me in my effort to beat the market over the long-term . No outlandish claims here. Just sound options strategies that make sense. And best of all, options strategies where the performance speaks for itself.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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