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The Option Genius Podcast: Options Trading For Income and Growth

Updated 2 months ago

Business
Investing
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Let's talk trading. Especially how to trade options for income. Whether you want to trade for a living, have a side hustle, or make extra monthly income from stocks, this is the place.We are here to help individual investors learn to trade options in a way that is simple, fun and profitable. The goal is to help you achieve Freedom. Financial freedom so you have no more worries about making ends meet and so you have more than enough for safety and security. Time Freedom so you can do what you want when you want. And Choice Freedom so you can live your life on your terms with no restrictions. We call it living the Option Genius Lifestyle. Where you can earn consistent monthly income by selling options using safe, conservative strategies. We place high probability trades and earn market beating returns in a way that takes just a few minutes a day. Listen in to learn how you can do the same. Hear from professional traders that have beaten the game. Some of the strategies we discuss are covered calls, naked puts, credit spreads, vertical spreads, iron condors, butterfly spreads, calendar spreads, strangles, straddles, and more. This podcast is about how we trade options and how it lets us life a lifestyle other people can hardly imagine. Trade from anywhere in the world, for just a few minutes a day, in a way that is super safe and can still make more than the averages? Listen in to learn how and check us out at OptionGenius.com

Read more

Let's talk trading. Especially how to trade options for income. Whether you want to trade for a living, have a side hustle, or make extra monthly income from stocks, this is the place.We are here to help individual investors learn to trade options in a way that is simple, fun and profitable. The goal is to help you achieve Freedom. Financial freedom so you have no more worries about making ends meet and so you have more than enough for safety and security. Time Freedom so you can do what you want when you want. And Choice Freedom so you can live your life on your terms with no restrictions. We call it living the Option Genius Lifestyle. Where you can earn consistent monthly income by selling options using safe, conservative strategies. We place high probability trades and earn market beating returns in a way that takes just a few minutes a day. Listen in to learn how you can do the same. Hear from professional traders that have beaten the game. Some of the strategies we discuss are covered calls, naked puts, credit spreads, vertical spreads, iron condors, butterfly spreads, calendar spreads, strangles, straddles, and more. This podcast is about how we trade options and how it lets us life a lifestyle other people can hardly imagine. Trade from anywhere in the world, for just a few minutes a day, in a way that is super safe and can still make more than the averages? Listen in to learn how and check us out at OptionGenius.com

iTunes Ratings

96 Ratings
Average Ratings
67
8
4
4
13

Very informative

By William Hemsworth - Feb 08 2018
Read more
Great show with great info. Highly recommend.

Loving the Content

By The Fat Packs Podcast - Feb 08 2018
Read more
Soon to be new to the market and I'm so glad I found this. Great insight and very helpful.

iTunes Ratings

96 Ratings
Average Ratings
67
8
4
4
13

Very informative

By William Hemsworth - Feb 08 2018
Read more
Great show with great info. Highly recommend.

Loving the Content

By The Fat Packs Podcast - Feb 08 2018
Read more
Soon to be new to the market and I'm so glad I found this. Great insight and very helpful.
Cover image of The Option Genius Podcast: Options Trading For Income and Growth

The Option Genius Podcast: Options Trading For Income and Growth

Latest release on Aug 02, 2020

Read more

Let's talk trading. Especially how to trade options for income. Whether you want to trade for a living, have a side hustle, or make extra monthly income from stocks, this is the place.We are here to help individual investors learn to trade options in a way that is simple, fun and profitable. The goal is to help you achieve Freedom. Financial freedom so you have no more worries about making ends meet and so you have more than enough for safety and security. Time Freedom so you can do what you want when you want. And Choice Freedom so you can live your life on your terms with no restrictions. We call it living the Option Genius Lifestyle. Where you can earn consistent monthly income by selling options using safe, conservative strategies. We place high probability trades and earn market beating returns in a way that takes just a few minutes a day. Listen in to learn how you can do the same. Hear from professional traders that have beaten the game. Some of the strategies we discuss are covered calls, naked puts, credit spreads, vertical spreads, iron condors, butterfly spreads, calendar spreads, strangles, straddles, and more. This podcast is about how we trade options and how it lets us life a lifestyle other people can hardly imagine. Trade from anywhere in the world, for just a few minutes a day, in a way that is super safe and can still make more than the averages? Listen in to learn how and check us out at OptionGenius.com

Rank #1: Selling Puts vs Owning Stock - 64

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Passive traders, I hope the markets are treating you nicely. Today I want to do something pretty cool. So I am finishing up the book called Passive Trading. Has been taken me I think over two years, but I'm finally getting close to completion. My editor told me that it's probably better to add a few examples of trades that I've done in the past and some examples of the different strategies that we're talking about. So I was like, "Yeah, that makes sense." So what I did was I decided to go into the past and pick a stock and say, "Okay, this is a stock. What if I did what I'm telling everybody to do? How would it work out without knowing anything about the future or anything like that?"

The example was for naked puts, selling naked puts. That's one of the strategies I cover in the book. I talk about it, say how to do it, this and that. And I said, "Well, what would happen if I take my strategy, how to do it, and go and apply it in real life?" So I picked Walmart because Walmart is not a stock that I own. I don't follow it on a regular basis. It is on my watch list because it's a good company and it pays dividend. It might be one that I want to get into, but up till now I don't own it and haven't traded it very much. So I said, "You know what? Let me go into Walmart. Let me try it and see."

So 2018, January 2018, Walmart was trading at $98.59. That was really good because in 2017 the stock was up 42%, so had a great year in 2017. What's it going to do in 2018? I don't know. I don't remember. And I haven't traded, so I don't know. So what I decided was I am not going to own the stock. I am only going to sell naked puts on it. If I get assigned on those puts, then I will see what I have to do there. Maybe I will sell the stock and keep selling more puts or maybe I will keep the stock and start selling covered calls. Either way, I'm going to have to do something, but I'm not going to roll. That was the decision. I wasn't going to roll my putts. I was just going to take the stock.

So I started on the 2nd of January, okay? First trade I did sold some puts, made 3.6% because the puts expired. Nice. Did another trade in February after that one expired. After the first expired, I did it in February. That one also expired. 3.2% gain. Then I did do one in March. 3.54% gain. Did one in April. 5.54% gain. Geez. This is easy, right? All I'm doing is selling naked puts on Walmart away from the money and I'm getting really nice monthly gains, and I'm not having to watch it. I'm not following. I'm not adjusting. I'm not doing anything. I'm selling the put, waiting till it expires, and then selling another one. That's all I'm doing.

Then, May came. Those puts expired. 2.83% gain. June, 1.85% gain. July, 3.9% gain. August, 2.53% gain. September, 2.75% gain. October, 4.89% gain. And November. Oh, November I finally get assigned. So on December 21st, Walmart closed at $87.13, which was 37 cents lower than my sold strike, so I had to buy the stock at $87.50.

Now, you might be thinking, "Oh wow, Allen, yeah, anybody can make money selling naked puts in a bear market." Walmart went up 42% the year before. It probably went up close to that in 2018 when you were doing it, right? Well, yes and no. 2018 was a year when Walmart traded from $98.59 at the beginning of the year. That's when I started trading. It went up to $109.55, so it did go up. But then once it got there, it turned around and went down all the way to $82.40, and then it ended the year at $93.15, which means that the stock was actually negative 5.6% for the year. So if you had owned this stock, if you had bought it on January 2nd, first day of trading in 2018, and you held it to the end of the year, you would've lost 5.6%. Now, you would've gotten the dividends, so maybe it's an even, but still that's dead money. You're not making any money on this stock if you are only buying it and holding it for the whole year.

But if you had done what I did and you had sold naked puts the whole way, you would've made 34.65%. Let that sink in here. I was selling naked puts on a stock that went up and down and up again and closed down. So this was not a stock that just went up in a straight line. This stock lost money on the year. But because of the naked put strategy, I made 34%, okay?

This is without owning any stock. I didn't own the stock until very end of the year, until December 21 when I actually had to buy the shares. Until then, I didn't own any stock, and I didn't really spend much time on it. I just put the trade on, let it expire, and then put on another one every month. Takes literally five minutes or less. Didn't watch the news on Walmart. Didn't care about earnings, or announcements, or what they were doing, or how the stock was doing. Doesn't matter. Didn't care. All I did was sell a naked put every month. Let the one expire, sell more, let it expire, sell more, let it expire, sell more, let it expire, some more on a stock that went up or down. Now, I understand if this was a stock that had just gone straight up, then yeah, you could say, "Oh, yeah. It just went straight up. Of course you've made money." True, but this was not that. This was a stock that went up and down, right?

So this was just one example that I did for the book. I just thought this was a really freaking cool example. I did a couple other examples we did on credit spreads on comparing owning the stock, a stock that was really good. I'm just going to tease you here. I'm not going to tell you what it was. But I picked a stock, I went back and I said, "All right, in this year, 2000 ... " I don't know what year it was. Think 2017 or 2018. I said, "Give me one of the best performing stocks." And I got a list of all the ones, and I said, "Okay, this one I think we can do credit spreads on." So I picked it, and I did spreads on it month, after month, after month, after month, after month, and the credit spreads did better than if you had just held the stock. Even though the stock was one of the best performing stocks of the year, you would have done better by selling options than holding the stock.

And this Walmart example is the same thing, same conclusion. 34% compared to negative 5%, okay? Less stress, less time, and a lot more money. That is why we sell options. That is why I'm into passive trading. Cool?

So if you want to learn more about passive trading, you can go to passivetrading.com. The book itself is ... Like I said, I'm going back and forth with the editor. Hopefully it will be out soon. If you want, you can email us about it or just go to passivetrading.com and see. It might there. But that's it. Yeah. Selling options come put together with owning stocks makes more money. I don't know if I can make it any simpler. And this was a real example. Like, dude, these are the numbers, you know? And in the book, I'm going to have what are the dates, what are the exploration, what are the price, what did I get, was the result. Everything is there. So you can go and check it for yourself.

Were these actual trade? Yeah, they were done. This was real numbers, okay? I didn't even think it was going to be this good. To be honest, I didn't know it was going to be this much of a difference, 34% gain versus negative 5% for owning a stock. Holy cow. That blew my mind. That's why I wanted to do an episode on. That's why I'm be like, "You guys got to look at this. This is so cool. This is so amazing. Why aren't you doing this, right? Why aren't you doing this right now?" All right folks. Until next time, trade with the odds in your favor.

www.passivetrading.com

www.optiongenius.com

--

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Mar 02 2020

9mins

Play

Rank #2: Getting Started As An Options Trader With Craig Davis - 48

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

In this episode we talk with a newer options trader who wants to make trading options his full time gig. So let's dive into his questions:

For more information on the program discussed in this episode, The Iron Condor Mastery, Click HERE

Craig Davis: So in terms of becoming options trader, being a specialist, what's the top three, top five things I should be looking to do, be, read, think about, think about, and words I'm supposed to have, things like that?

Allen: Okay. The top five or three things that you need to know to be a full-time trader. Obviously, you need to learn. There are many different ways to learn, right? There are many different coaches out there, there are different books out there. You can go, I know in the US we have the public libraries, and you can get any introduction to trading book, and they'll have lots of different strategies in there, they'll teach you everything. But I think it comes down to, so let's say...

Okay, so if I was going to be a trader, so I'm starting over, I'm working my job, I think in the beginning I would try to be more realistic and say, you know, "I need to set my goal, whatever my goal is." I need to, whatever my monthly expenses are, it's 5000 pound a month, or 10,000, whatever your expenses are. So, that's the central goal. And then I think you have to get into the psychology aspect of it first.

Craig Davis: Yeah, okay.

Allen: Where you have to figure out, okay, why? Why is this so important to me? What's going to happen if I don't achieve this goal?

Craig Davis: Okay, yeah.

Allen: Because I think you really need to dig down and make a list of all the negative things, and all of the horrible things that will happen. You know, I'm going to be working until I'm 70 years old, my kids are not going to be able to go to the right college and university, and all these different things, to make it like a mandatory thing in your life, that you have to achieve this goal no matter what happens.

The reason I say that is because a lot of people, they have, "Yeah, yeah, I want to make more money, I want to make more money." But then, while they're on the road, the road has bumps. And so sometimes they go over a bump and say, "Oh, that was too bumpy. I'm going to get off of this road. I don't want to do this anymore." Or they pause, or they stop. They pull over to the side, and they say, "Oh, I'll get back to that after my kid graduates from school, or I'll get back to that after this happens. Let me do this project at work first." They lose track, and then they never come back.

Craig Davis: Okay, okay.

Allen: So, that's a big problem. So, the mental aspect is there. And then the second thing, I think once we have that, then really, you know, you need to look over your entire lifestyle and say, "Okay, I obviously... You need money to trade." There's no other ways about that. So, we need to have, and build up our account as much as possible, so that we have some money to trade.

Craig Davis: Yeah.

Allen: That way you're reducing your expenses as much as possible, paying down your debt, so you're not paying extra fees, and interest, and all that stuff. And then, putting that money away and saving it. Once you have that done, let's say you have the mental aspect done, you have some money to trade, then I think you do some research and you say, "Okay, there are all these different strategies, which one do I think gives me the best chance for success?" And for every single person, it's different. There are people who tell me that, "I think what you're doing, where you're selling options, that's way too boring for me. I want to be a day trader, and I want to get rich in three days." Then, you try that path, right?

Craig Davis: Okay.

Allen: There are people that are very aggressive, there are people that are very conservative, and they say, "Oh, I don't want to take very much risk." Well, okay, then put your money in the index fund, or put your money in a bond fund, and just buy bonds, and make, whatever, two, three percent the bond is paying you, and you live off of that. There are some people that, I know one guy in Canada, he has a company where he teaches people how to do dividend investing.

Craig Davis: Oh, okay.

Allen: By the right shares, and they'll give you four or five percent a year in dividends.

Craig Davis: Okay, fair enough.

Allen: So if that's your thing, that's your thing, that's all you do, and that's all you do. You don't need to worry about it. I found that, for me, I found something that I don't want to only make four or five percent. I want to make, per year, at least 20 percent. And then, I want to do it in a way that made sense to me. For me, I'm a bit of a lazy person, honestly. I don't want to put a lot of time [crosstalk 00:04:31]-

Craig Davis: I think you're being over modest.

Allen: No, really. If you talk to my wife, she would definitely agree with me.

Craig Davis: Well, so you do some work somewhere, so there's some work there somewhere.

Allen: We do a little bit of work here and there in the office. But in terms of the trading, it's not that much. In the beginning, I wanted to find out what I wanted to do, so I did a lot of trades in the beginning. I did a lot of what's called the virtual trading, where you get a free account, and you just do all the different strategies, all the different trades, see which one works for you. I did a lot of back testing.

Craig Davis: Yeah.

Allen: There's software out there that lets you basically go back in time, and you put on a strategy, and then you just go through day by day by day how the strategy worked. If you need to adjust the trade, you can, if you need to change your strategy, you can. So, that was very, very beneficial, because that took a lot of time... If you do virtual trading, like paper trading, or you use real money and you do...

Let's say I want to do a butterfly spread. You come up with your own criteria and you say, "I want to try this new strategy that I've created. I'm going to do this, and this, and this, and this." To actually do it in real time would take you 30, 35 days, and you only get to do one of them.

Craig Davis: Right.

Allen: If you do the back testing, you go back to, let's say, 2000, January 1st, 2000, and you put on your trade. Within like three hours, you can do 10 hours, or 10 years worth of trades.

Craig Davis: Right [crosstalk 00:06:07].

Allen: So it's a big, big chance where you don't spend that much time on it. And you get the learning much faster.

Craig Davis: Right, I see. Yeah. Okay, yeah.

Allen: In the beginning I would find, I would say, "Okay, I'm going to find..." I wanted to find one strategy. Just one trade I could just do it, I don't have to do anything else, I don't have to worry about anything else. This is the only thing I wanted. I just wanted to find one thing that would work. I tried different things. I tried butterflies on McDonald's, butterflies on Walmart, I tried iron condors on certain stocks, iron condors on indexes, credit spreads, double diagonals, cover calls. I tried several different strategies. They all have their benefits, and they all have their negatives.

Craig Davis: Okay, yeah.

Allen: I do think that you can take any one strategy and just work with it, and learn it, and do really, really well with it. So if you find one strategy speaks to you, then focus on that one. Do your virtual trading, and if you can afford a back testing software, get the software, and just within a weekend, you'll have done dozens of trades. You'll have a leg up on everybody else that's doing this. I think that's a secret that people don't really use as much.

Craig Davis: Have you got like two or three back testing softwares that are for doing research?

Allen: So, the one I use most is called Option Net Explorer.

Craig Davis: Okay, Option Net Explorer, yeah.

Allen: I think that one costs... I don't know how much it costs now. Let me see. They have a 30 day trial, so you can try it for 30 days. After that, I think it's... Actually, the 30 day trial is 10 pounds.

Craig Davis: Okay.

Allen: And then for a year, it's 500 pounds.

Craig Davis: Wow.

Allen: You're in the UK, right?

Craig Davis: Yeah.

Allen: So yeah, so it's 500 pounds. So it's a little pricey, you know, maybe you don't need it for a month, or you don't need it for the whole year, but [crosstalk 00:08:16]... Yeah, so it's 10 pounds for the month, so you try it out. And if you like and you want to keep doing it, you can do, they have a three month plan and then they have a 12 month plan.

Craig Davis: Yeah, I'll look at that three month. Okay, three-month and 12 months, okay.

Allen: I mean, you look at everything and you say, "Okay, these are the different things that I want to test. Before you open the account, or before you do the trial, come up with your rules. Like, "Okay, I'm going to do this strategy, and this is my rule, this is what I'm going to put the trade on, this is how I know I'm going to be in trouble." You know, so you have a basic whole trading plan. And then you go and you test that, and you try it. You say, "Okay, this didn't work. Okay, how can I fix it? What can I do differently?" Then you go back and you try it again, and try it again, and try it again until you come up with something that works for you. We have different trading plans that are [crosstalk 00:09:07].

Craig Davis: I'm looking to specialize in the Iron Condor one.

Allen: Okay.

Craig Davis: Because I've seen some things, and trades in the range, and all these adjustments and all that seems like it's a good plan. And then I seen on your program, you have the lazy day trading, or something like that. That incorporates some Iron Condor. So, maybe I am heading towards the iron Condor thing to focus on and try and specialize in.

Allen: Yeah. So we do, we have that course. It teaches everything of a tizzy about the Condor, how it works, how do you do it. It gives the different trading plans that you can use based on if you want to be aggressive or more conservative, whatnot. So, if that's something that you want to focus on, then just go 100 percent and do that, and see how it goes. Do the trial, and test all the different trading plans, see if you can find some other trading plans online.

Craig Davis: Okay.

Allen: I know the ones that we've put into the course, we've tested them, we've done them with real money, so we know that they work. So the question is really, "Okay, so here's the plan. Allen says it works. Now let me go back in time and let me try it, and let me see how I do."

Craig Davis: I like that bit, yeah.

Allen: And let's see. You know, let's see if Allen is full of it, or let's see if he's really telling the truth.

Craig Davis: Now, that's fair enough. I like it. Yeah.

Allen: Because it also, like I said, it's different for everybody. So, the trading plan, we've gotten testimonials from people and said, "Hey, I tried this and it worked great," and then we've had other people that said, "I tried it and it failed, and I didn't work." So, what's the difference? The plan is the same, the market is the same.

Craig Davis: People.

Allen: It's the people that are, they're doing something different or whatnot. We had one student, he was in one of our other courses. It was, you know, you put on the trade and you wait until the trade, if it goes against you, you have to let it go to a certain Delta.

Craig Davis: Yeah.

Allen: So we do that with condors as well. You put the trade on at a certain Delta, and when it gets to a certain Delta, that's when you know that, okay, it's time to change or adjust the trade.

Craig Davis: Yeah.

Allen: Well, this fellow didn't want to wait until that Delta. He was looking at the money and he said, "Oh, I was down 200 dollars, so I got out of the trade, and it didn't work."

Craig Davis: Yeah.

Allen: I said, "But, that's not how it works. That's not the plan."

Craig Davis: Yeah.

Allen: You can go down four 500 dollars, and then eventually it will come back up, and then you'll win. So, you have to be able to ride the waves. For him, that particular plan, or maybe trading in general was not, it didn't fit for him, because of his style. If you cannot see yourself and say, "Okay, I'm going to put the trade on..." When we're selling options, especially with iron condors too, in the beginning of the trade you might be down 100 dollars, 200 dollars or something, before it turns around and then it starts making money again.

Craig Davis: Yeah.

Allen: But if you don't have the patience, or you don't have the ability to just sit and wait, then this is not the trade for you.

Craig Davis: That's true, that's true. Yeah, from what I can see and from what you're saying, it seems like you have to have that confidence to stick to the plan, and just follow the rules according to the plan. So yeah, I think that's-

Allen: You have to have confidence in the plan. So, that's why you do the back testing. You just do it as many times as you can, you track all your results, and you look at it and you say, "Okay, you know what? Over the last 10 years I made money eight of the years or six of the years, I lost money for of the years. In my head, am I behind? Is that acceptable to me?

Craig Davis: Yeah, yeah.

Allen: You know? I had a friend of mine, he found this strategy for the iron Condor, somebody showed it to him, that says, "This is how you put the trade on, and then you never touch it."

Craig Davis: Oh, naughty. Yeah.

Allen: That's it, you don't do anything else. You put the trade on, and then you just let it do its thing, and the numbers should work out, and you should make money. So, it's either you're going to win on that trade, or you're going to lose the maximum.

Craig Davis: Yeah, that's not a good trade then. That's not a good plan.

Allen: Right. I mean, before we make a judgment, we have to test it. So my friend, he's very smart, so he said, "Okay," and he got it. He got the same software, this option software. Now this guy, he's wealthy, he's already wealthy. He went and he found somebody, and told them, "Hey, I need you to learn how to use this software, and I'm going to pay you to run this test."

Craig Davis: Nice one. A real life scientist, yeah.

Allen: Yeah. So, he hired this person, and the guy did all the testing for like the past 20 years or something. The results were that if you had traded this way every single year for 20 years, you would've just about broken even.

Craig Davis: Oh my gosh, that's not good.

Allen: Yeah. There were some years where it did very, very well, and then there were some years where he lost a bunch of money. But overall, over 20 years you would've broken even. So he's like, "Yeah, this doesn't work," and I'm like, "Well, I'm glad you know before you wasted the next 20 years to try to bring it out."

Craig Davis: [inaudible 00:14:35].

Allen: So for iron condors, I do believe you have to adjust it. That just gives you a better chance to win.

Craig Davis: Yeah.

Allen: But another thing you have to be aware of is, you don't always want to be in the market.

Craig Davis: Okay. That's an interesting concept. Because you're always like, when you see on some of the things where they say, "Oh, yeah, you've always got to be [inaudible 00:14:59]." So it's interesting when you say be in the market and out the market. What do you mean by that? That's a good mindset, I suppose for someone that starting out?

Allen: In the stocks, when you're investing in stocks, they have gone back in time and they've looked at this, and they've said that most of the games that are made in the stock market are made in a few days every year.

Craig Davis: No way.

Allen: Maybe like 20 days every year. That's when the majority of the gains happen.

Craig Davis: No way, so what's happening for the rest of the time?

Allen: 70 percent of the time, stocks go sideways.

Craig Davis: Sideways, okay.

Allen: Yeah, that's why iron condors work. They go up, and they go down, and they go up, and they go down. That's why they tell you that you always have to be in the market if you're a stockholder, because you don't know when those days are going to happen.

Craig Davis: Yes, yes.

Allen: It could be in the beginning of the year, it could be in the middle, could be the end. You might miss out on a rally... Like for example, this year, 2019, if you were in from January to now, you would be up whatever it is, 16, 18 percent.

Craig Davis: Yeah.

Allen: If you missed these first few months, and you get in right now, well it looks like the market's going down, so you might lose money the rest of the year.

Craig Davis: Yeah, yeah.

Allen: That's why if you're a stock trader, most of the time you have to have your money in the market, because you can't time it. You don't know when it's going to go up and when it's going to go down.

Craig Davis: No, no.

Allen: Most of us. Most of us cannot.

Craig Davis: Most of us, yes. And unless you've got that magic crystal ball where you can say, "Oh, yeah..."

Allen: Yeah. But when you trade the iron Condor, or other option strategies, you want to look at what's the VIX. The VIX is the volatility of the overall market.

Craig Davis: Yeah.

Allen: Now, the more volatile it is, the more volatility there is, the more the option prices are worth. You get more money when you sell them. But, that also means that the stocks are moving up and down much faster.

Craig Davis: Right, okay.

Allen: So you have to be on your toes. You have to be watching every day when it's very volatile, and you have to be ready to adjust, you have to be ready to play with it, and you have to be... To trade when it's very volatile, you have to be the best of the best.

Craig Davis: Right, okay.

Allen: When volatility is very low, the stocks aren't really doing anything, you can put on the trade and just wait, and then it expires, and you're done, right? Anybody can do that. And so in the beginning when you're starting out, I tell people like, "Hey, if it's too volatile for you, if you are getting nervous because there was a two percent move, or a three percent move in a day, then that's a signal that this is above your skill level, and you need to just get out."

Craig Davis: Okay, yeah.

Allen: Because if we are trading iron condors, we can make 10, 12, 15 percent per month.

Craig Davis: Yeah.

Allen: Do we need to do it every single month? No.

Craig Davis: No, okay. Right.

Allen: If you have two or three good months, and you're up, let's say... Let's say it's the end of March and you're up 30 percent for the year, that's a pretty good year. You could take the rest of the year off, and say, "Hey, I made 30 percent." Most people don't do that, because they're so greedy. They're like, "Yeah, I want to get more. Let's go for 70 percent. Let's go for 100 percent."

Craig Davis: Okay.

Allen: Eventually one of those months you're going to lose. And the thing is, you really cannot tell, in the beginning, you cannot tell which months are going to be simple and which months are going to be very volatile. But the thing is, when you're done with a trade, you can re-examine and say, "What's going on in the market right now? Do I want to get in right now, or do I want to wait? Is there some news event on the horizon, or something that would cause the market a lot of uncertainty and a lot of concern? Then I'll just wait until that thing is over with, and I'll see how the market is reacting to it, and then I'll put my trade up." So, that's what I mean by you don't have to be in it all the time.

Craig Davis: Right.

Allen: You can pick and choose. [crosstalk 00:19:05]... Sorry, go ahead.

Craig Davis: Is there a way in your training, or is there some way to be able to help you make that decision? Because I might see the... The VIX might be something given this is in the market, but [inaudible 00:19:22] say with confidence to say that, oh, the market's a bit volatile at the moment, I might stay out of it?

Allen: So, it takes a little bit of experience to be able to really pinpoint it. But I'll give you the short version.

Craig Davis: Okay.

Allen: What I do whenever I'm putting on a trade, especially my iron condors, and I do them every month on SPX, and I do them on Rut, those are the two big ones that I like... You can do them, if you have less money you can do them on SPY, and IWM, or any of these ETFs.

Craig Davis: Okay.

Allen: I like to do them on the big ones, because it takes less contracts, and it has different advantages. But, I look at, when I'm putting on the trade, I have an analysis sheet and I say, "Okay, what is the VIX trading at right now? Do I see any kind of support and resistance on the chart? How did I do last month, how did I do the month before?" And then I'll also look at the standard deviations. So, standard deviation is basically a percentage movement. It's a statistical number, statistics, so it will tell you that the SPX moved in a bigger amount than it normally does.

Craig Davis: Okay.

Allen: So even if the volatility is still the same, today they had a really big move for some reason. So normally, you know, 70, 80 percent of the time, the SPX will be within one standard deviation.

Craig Davis: Okay.

Allen: If it moves more than one standard deviation, then that's a cause of like, "Hmm, let me pay attention to this."

Craig Davis: Okay.

Allen: If it's moving more, if it's moving two standard deviations, then that's a flag. And say, "Okay, there are big moves happening here, I need to pay attention to this, or maybe I need to get out of the market, or maybe I need to stay out."

Craig Davis: Right, yeah.

Allen: If there is a day when there is more than a one standard deviation move, I don't get in, I don't put a trade on that day.

Craig Davis: Right, okay.

Allen: I want to get in when it's a calm day. So that is the shortcut there, that you need to monitor the standard deviations on a daily basis, and see how they are doing for whatever instrument you are trading. If it's not SPX, if it's a stock, [crosstalk 00:21:35] you can find the standard deviation for everything. Look at it and see, "Okay, I was trading it last month, and it wasn't really moving very much. But now, it's moving one standard deviation every day for the last three days. Okay, something is going on."

Craig Davis: Okay.

Allen: So that's like a flag, it's a bell. "Ding, ding, ding." [inaudible 00:21:58].

Craig Davis: Yes, okay.

Allen: You need to research this more and decide, "Hey, what is the cost, and do I want to get in or not?"

Craig Davis: Yeah.

Allen: There's different ways. Sometimes I look at it and I'll say... When I'm putting the trade on I look at it, "Okay, over the past two weeks, how many times has it moved more than one standard deviation?"

Craig Davis: Okay.

Allen: If you get two or three, that's normal. You have to understand what is normal for whatever instrument you're trading.

Craig Davis: Yeah.

Allen: But for SPX, two or three times is normal. If you get seven or eight, that's very high, because it's only for two weeks. Over the last 10 days, it moved a lot more than one standard deviation seven times, that's very high. So that means that, without even looking at the news, you know that there is something happening in the market.

Craig Davis: Right, okay. Yeah. No, I like the sound of that. That's a good... There's one thing to a trading plan, but this analysis sheets sounds like another good thing as well. And definitely looking at standard deviations, and the movements and the market's an instrument. That sounds like a good, what's it called, skill, or discipline to have. So thank you.

Allen: It's something that can help you, you know? Just keeping an eye on it. It's not a hard and fast rule that you don't do it, or you have to... I don't initiate a trade when there's more than one standard deviation. Do you have to do it that way? No, that's just my personal preference. But, this is something that you can, it's like another tool that you can use.

Craig Davis: Okay, yeah. Lots of tools in the toolbox sounds good to me, lots of skills, yeah. I like the sound of that. So that's something I need to have in my vocabulary more than the standard deviations, the percentage movements?

Allen: Well I mean, if you don't do the standard deviation, you can look at the percentage movements, but then you'll have to remember. It's harder to remember. If you... I don't know what broker you're using.

Craig Davis: I'll be using Interactive Brokers.

Allen: Okay. So, I'm not familiar with their set up, but if you call them, or you find online that there must be a way that you can actually, on your chart you can see the standard deviations.

Craig Davis: Yeah, let me write that down. [inaudible 00:24:26] brokers where on charts I find the standard deviation. Yeah, okay.

Allen: You might have to write it down, or they might have it visually on your screen, however. But whatever works for you, it's a good measure to keep track of.

Craig Davis: Yeah. Thank you. No, we'll do that. Standard deviations, [inaudible 00:24:55] analysis sheet. Is the first one on there now? [inaudible 00:25:02] I need to get a trading plan, makes me stick to the trading plan, my analysis sheet. So you've now got another sheet now that says analysis on it [inaudible 00:25:10], and check standard deviation.

Allen: You also want to make sure that you're not trading during earnings, if it's a [inaudible 00:25:20].

Craig Davis: Okay.

Allen: And, if you're doing iron condors, you want to know in advance, at least have an idea of what you are going to be doing as an adjustment if the trade goes against you.

Craig Davis: Okay. That sounds like an interesting technique. How would I... Because you've got a couple of programs, is that mindset and that skill set within there, like that adjustment thing that you were just saying, like is that [crosstalk 00:25:51]?

Allen: In the course, and the iron Condor course, that's covered in detail.

Craig Davis: Oh, okay. So then-

Allen: Yeah, so we actually have videos where I went through some, I think it was three really, really horrible iron condors, like the market just went crazy. I go through it on that software, that back testing software I told you about.

Craig Davis: Right, okay.

Allen: I go through it on there, and I go day by day and I'm saying, "Okay, market just dropped 50 points. Okay, this is what I'm thinking. Do I do this, or do I do this, or what happens if I do this? Okay, which one am I going to do? I'm going to do this, because of XYZ reason. Okay, now let's see if it worked. Let's go day number three, day number four, go forward, go forward." So basically I'm telling you what I'm thinking as I'm going through the trade.

Craig Davis: Okay. I like it. That's a good, that's the best way I think.

Allen: So now are you going to be, you're in the UK, are you going to be trading the US stuff, or English stuff?

Craig Davis: US. I'll be looking to do US, yeah.

Allen: Okay, so the market-

Craig Davis: But I think my main focus is going to be the US stuff I think. Like the SPX, like I just said, SPX, or SPY and all that. I want to try and do something may be on the SLV possibly, if I can do something.

Allen: Okay.

Craig Davis: As I say, I've I've got to look at your program, look at the resources that I've got, and then just [inaudible 00:27:16]. But yeah, the ETF SPY might be the one that I start with as well. But yeah, that's where I'll be starting, on the American stocks, and the American instruments.

Allen: Right now, gold is very steady, I think. I haven't checked it. I think it's been steady. I haven't checked SLV though. Let's see how that's doing. So yeah, these are ones that do not have earnings, so they are good to do that, they're good for iron condors.

Craig Davis: Okay. Sounds like a good one to do some back testing and research on that. Okay, yeah.

Allen: Definitely. Yes, definitely. Hold on a second. Hold on, I'm going to share my screen.

Craig Davis: Oh, okay. Do I have to press anything? Oh, no, it's fine.

Allen: I don't think so. You can see?

Craig Davis: Yeah, yeah, yeah, yeah, yeah.

Allen: All right, so here is SLV, and you know, it's pretty much up at 16, and died down at 13 something right now.

Craig Davis: Yeah.

Allen: So basically if we're doing an iron Condor... And you can use... In the course we normally go for about 45 days. But we can go 28 days. This one doesn't have a lot of volume, SLV though.

Craig Davis: Right.

Allen: So, might not be the best one.

Craig Davis: Okay.

Allen: Let's try it.

Craig Davis: Do you have a minimum volume in the instrument that you go for? What's your guide range?

Allen: I just want to see some action.

Craig Davis: Oh, okay.

Allen: If I'm doing five contracts, and like this one, this one has 200 contracts every day, 100 contracts. That's fine, because I'm a small part of that.

Craig Davis: Right, okay.

Allen: But the other one, SLV, this one was only showing, like right here, there's only 230. So, these are the only two options I have. So, I don't have a lot of choice in which to trade, so it was like, ", yeah, I don't want to do that one." You know, compared to SPY, you take a look at that one and you're going to say, "Oh, you have a lot of these to choose from."

Craig Davis: Yeah.

Allen: People are trading all of them. So, you have enough liquidity to get out if you need to as well.

Craig Davis: Yeah, yeah. Liquidity, that's definitely a good keyword.

Allen: So if you are doing this one today, depending on how much money you want to put into each trade, you can go to the 292 maybe. Let's say we do 200 each, so two points. This is what our trade would look like.

Craig Davis: Yeah.

Allen: This trade gives us a 66 percent probability of winning, it's right in here in the middle, and then I can put these on the chart. So basically, this redline and this redline are the top and the bottom of our trade.

Craig Davis: Yeah.

Allen: So it seems like it'll do all right.

Craig Davis: Yeah.

Allen: This is a yearly chart. In this trade, what can you make? You can make 55 cents, and it's 200, so let me see if I... You can make 100, you can lose 300. So you know, whatever that is. You have a 66 percent chance of doing that. So what is that, like 33 percent gain? One divided by three?

Craig Davis: Yeah.

Allen: You could make... I mean, so you can be more conservative than this if you wanted to.

Craig Davis: Yeah, okay.

Allen: You can bring these all the way out to here, and go maybe 75 or 80 percent probability. That way, your tent will be larger.

Craig Davis: Right, okay.

Allen: So, less of a percentage return, but more chance of being safe.

Craig Davis: Okay.

Allen: Now the thing is, like right now, I don't know if you've been following the news or not, but the US and China, they're having their little trade war.

Craig Davis: Trade wars, yeah.

Allen: So that has been sending the market up and down almost every day for the last week or so.

Craig Davis: Right, I see.

Allen: If there's a tweet from Trump, then it goes up, otherwise it goes down. So in this environment I would say, no "Well you know, VIX is up a little bit, let's look at standard deviation, and these are the standard deviations. So in the past two weeks, we have one, two, three, four, five, six, seven, eight, nine, 10, one, two, three, four days where it moved more than one standard deviation." So that's a little bit on the high side.

Craig Davis: High side, okay. Yeah.

Allen: I would love it if it's like this, where it's all just gray, and no, they may be have one, but that's about it.

Craig Davis: Yeah.

Allen: This is telling me things are getting heated up.

Craig Davis: Right, okay.

Allen: Just looking at it visually. You see this, you see a lot of gray, a couple bars, a couple bars, couple bars, then all of a sudden you start seeing more reds and yellow. Yellow for here is a danger, because it's more than two standard deviation.

Craig Davis: Right.

Allen: And then, you're see more color, it's getting a little heated, so you have to be careful. That's all that tells you.

Craig Davis: Yeah, that's cool. Okay. So you say something about news, what kind of news are you following, or if there is one I should start looking at, one or two?

Allen: I try not to.

Craig Davis: Oh, okay.

Allen: I try not to watch the news. [crosstalk 00:32:48].

Craig Davis: Okay, good.

Allen: Yeah. I've done... When I do my back testing, you don't hear any news. You're just looking at the chart, you're looking at the trade and you're going day by day. You don't know what's going on in the world.

Craig Davis: No.

Allen: You will do better in your back testing than in real life, for sure.

Craig Davis: Yeah, that's true.

Allen: Just because the news has an effect on us.

Craig Davis: Yeah, true.

Allen: When you're in the trade for 30 days sometimes you get scared, sometimes you hear something. So, if you're only watching the trade, you're not watching the news, you'll actually do better.

Craig Davis: Right, okay. No worries.

Allen: But sometimes there's stuff like this, when it starts dropping all of a sudden, then you have to pay attention. "What's going on? Why is it always that it's going steady for so long, and then all of a sudden it starts dropping?" And then you have all, look at this, you see this? Red, red, no red, red, red, red, red, yellow. This is like, "Hello, wake up, we have something going on here."

Craig Davis: Yeah.

Allen: So that's when you watch the news and you see what's going on.

Craig Davis: What's going on, right. When the red flags are there, then watch the news, okay.

Allen: Yeah. So I mean, I watch some shows that tell you like technical analysis, what other people are thinking. They'll say, "Oh, this is the line of resistance, and this is the support level, and this is this," okay, I'll take a look at that. But on a day to day basis, the nude is total baloney. They have no clue why the market is moving. Really, on a day to day basis, they don't have any clue. They have to make up something.

Craig Davis: Yeah. Yeah, just to keep the viewers happy, I suppose, yeah.

Allen: Yeah, I mean, they have to have airtime, right? They're on 24 hours a day, they have to talk about something.

Craig Davis: Okay. Yeah, yeah, no worries. No, that's really insightful there, thank you. Yeah, so red flags, warning, check the news, standard deviations. [inaudible 00:34:51] if it's yellow, yeah, stuff is happening.

Allen: I mean, Interactive Brokers might not show it like this.

Craig Davis: No, that's fine. If they've got it somewhere, I'll just have to just get my eyes used to the way that they present the data, but yeah, I'm happy to do that.

Allen: So essentially you have about 2000 to trade with, is that what you wrote?

Craig Davis: Yes.

Allen: Okay. And your expenses, your goal is about 3500 a month, and you want to get there in about three years.

Craig Davis: Yes. Or sooner, or sooner.

Allen: Or sooner.

Craig Davis: I put that down there because, like as I say, I just put the figures down there, in terms of like what's achievable and what's possible.

Allen: So let's say, here, let's do some quick math. So, 3500 times 12, 42,000 pounds a year, and you have 2000 to work with.

Craig Davis: Yeah.

Allen: That's 42,000 divided by, let's say, 25 percent a year. If you're making a 25 percent yearly return, you would need an account of 168,000.

Craig Davis: Nice one.

Allen: And you're at two.

Craig Davis: Yeah, so that's no chance. [crosstalk 00:36:04].

Allen: How long will it take you to go from 2 to 168? There's a small chance, but you'll have... I don't want you to take excess risk is what I'm saying.

Craig Davis: No, no, no, no, I'm in it for the long term. I'm going to start small, grow small, learn.

Allen: And right now you have two, but that's what we talked about earlier, you're saving whatever you can. [crosstalk 00:36:24]...

Craig Davis: Yeah, you'll add into it, yeah.

Allen: Yeah. One of the things I tell some people is that, when you're doing your back testing at your paper trading, even if you're not real money trading, keep a result of all the records.

Craig Davis: Yes.

Allen: Keep a track record of how you're doing. Because you never know when you're going to run into somebody who has money, or an uncle, or someone who's... Because you know, when you go to a party or you meet someone, you say, "Oh, hey, what are you doing now? What are you up to?" And you, "Oh, I'm trading options." "Oh really?" "Yes." "How are you doing?" "Oh, I'm doing fantastic." "Really? Oh, okay, I have some money that I need to invest. Can you do it for me?"

You will be surprised at how many people there are that have money, that they don't know what to do with. So these people, they might come and tell you, "Okay, I have 20,000 pounds, please do something." And you do it for them if you want to, and then you keep, "Okay, I'll take half the profit." "Okay."

Craig Davis: Yeah.

Allen: But keep in mind though that that also brings another level of stress.

Craig Davis: Yes. I could imagine, yeah.

Allen: Losing your money is one thing, losing somebody else's money is a whole different thing.

Craig Davis: That's true. Yeah, man, you have to be careful. Yeah, that's fine. Yeah, man. Just go and lose their money that easy. There's a UK term, they call it like a... I don't know how you'd say it in American slang, but in the UK it's like, "Don't pee it down the toilet," or something like that.

Allen: Yeah.

Craig Davis: Yeah, so I understand [inaudible 00:38:05].

Allen: Yeah, we call that, what do we say? We say we pissed it away.

Craig Davis: Yeah, that same thing, yeah. So yeah, we say the same thing.

Allen: Cool.

Craig Davis: So yeah, definitely. That sounds like a way forward. That's excellent.

Allen: So what else, what other questions?

Craig Davis: So, with respect to... I'm just trying to think, I think I've gone through the sort of, like you definitely have the mindset [inaudible 00:38:36]. With respect to adjusting, so you've calculated how much to put on a trade for an iron Condor. I'm just going by the term, like the rollover adjusting, is there a way to calculate, or you can't tell how far it could go against you, is there a way to make it like a rough ballpark figure on how much to put aside if you needed to do an adjustment? Or is that all on your course on how to make the decision should you adjust, or should you do this, or take money off the table?

Allen: In reality, you can adjust forever. You can adjust month after month. You can keep it rolling forward, "Okay, so I didn't do good this month, I'm just going to roll it into next month," and then roll it into next month, and you can just keep going. I don't think that's a good idea, because it never ends.

Craig Davis: Yeah.

Allen: If I lose money on a month, then I just want to end it, and then start over fresh.

Craig Davis: Yes.

Allen: I don't want that baggage of coming, "Okay, I'm down 300 dollars from last month, I got to make it up." No, I want to start fresh, and whatever I can make, and then get it back eventually. If I was to put... I usually keep about half of what I put in originally.

Craig Davis: Oh, okay.

Allen: So, if I put in 1000 on a trade, I might keep another 500 on the side.

Craig Davis: Okay.

Allen: Or maybe another thousand, and worst-case scenario, to adjust.

Craig Davis: Okay. Why not, why not? Okay, I like that. Yeah. I like that. It makes sense. So 100 to 50 percent, why not? Why not? I like that. I like that. So trade, and that's what you [inaudible 00:40:22]. Okay, why not? Yeah, I like the sound that that's okay. Let's see, what other questions could I ask you? I sure have put some on my email, but-

Allen: It says here that you took some courses already?

Craig Davis: Yeah, so I took some courses. I know this might seem like a strange one. There's a guy called Robert Kiasaki. I went to one of his training things and I thought, "Right, I'm going to fly in..." So pretty much, he's the one that put me on the path to try and look into do these things. I've been trying to do real estate things, and business things, and the stocks and shares thing. So I've done a couple of things, but that was just like the theory. I never got into a paper trading account.

So last year I went, because in my full-time job I work in healthcare, I work in a pharmacy. So I got this contract, I was at the hospital pharmacy, where you've got more some more and things. I worked with this guy, I worked with him before, and he says, "Oh, come and work with me on this iron, and it's paying me [inaudible 00:41:21] a bit more money." So I thought, "Oh, based on the hours that I've got, this is okay."

But what I didn't factor in, and maybe it's a life lesson, is like the downside. If you can imagine, I experienced the most downsides where, this is my assumption, I never asked, so I suppose I wasn't wrong. So for example, the person contracted [inaudible 00:41:46] for his business, he was saying, "There's too many staff, we're not going to employ staff." So I go, "What do you mean by that?" I had to find out the hard way that if all the jobs don't get done, I have to stay behind.

Allen: [crosstalk 00:41:57] Yeah.

Craig Davis: So before I was supposed to do 45 hours a week [inaudible 00:42:02], I think I must've pushed about 75, 80 hours a week. I was there late nights on weekends, I was there on my days off.

Allen: Right.

Craig Davis: I was there trying to... So, my plan was to go there, get my paper trading account up and running, start doing some stuff, so that's where I had the idea to get onto the [inaudible 00:42:22]. But then it stopped. So let's say, so April, May, say June 2018, I stopped doing stuff. So in the process now, I have to send an email back to Interactive Brokers, because my account cleared [inaudible 00:42:37] on SLV. I was selling some put options, because I thought, "Oh, I've learned about put options, let me sell some put options, and if it goes up, I keep the premium, if it's slow I keep the premium, if it goes down, then I don't get the stock anyway, but I got it for discount."

So I started doing all that and then, boom, the reality of that kicked in. Then, I says, "Oh, I need some annual leave." He goes, "Oh, I can't find cover for your annual leave." I go, "What are you talking about?" So before I just assumed, I never discussed it. Well, it's not that I didn't discuss it, but I thought like, well... So for now, I'm just working with teams now where if I can get an agreement where possible, I'll go for that. Because before, I just overlooked it.

Allen: Mm-hmm (affirmative).

Craig Davis: I overlooked, like with my other team, like they were saying, "Oh, you got to do this [inaudible 00:43:30]." "You guys are killjoys." He was telling me, "Sorry, we can't give you cover for your leave," so I says, "What are you talking about?" So, I didn't have the words and the vocabulary, because I never thought I'd have to present an argument to ask for... Or, [inaudible 00:43:47] present an argument to request for annual leave.

Allen: Yeah.

Craig Davis: Never. I thought, "Okay..." So with respect to the courses, I started off with Robert Kiasaki, did some real estate ones, and there's a guy called Andy [Tamura 00:44:04], he had some ones. Then recently, I went on to Udemy, and that's where my... Because on Andy Tamura, he did one of these things and then I stopped. [inaudible 00:44:16] the profile, and when I seen the profile, "Oh, someone on Udemy," and I seen this thing it says like, "How to make money on weekly options," and it was talking about iron condors.

Allen: Mm-hmm (affirmative).

Craig Davis: So I researched and said, "Oh my gosh, he was talking about that." And then they say, "Oh, you've got to get educated," so I went on some podcasts and then I came across yours. I was listening to the way that you were speaking for your people and I thought, "Yeah, yeah." Because they say sometimes if a person, you can listen to what they're saying, but you have to make the decision on what they're presenting and what they're saying.

Allen: Right.

Craig Davis: What gave me the confidence to say, "Oh, yeah, this guy seems okay..." Because when you where then talking to the student guy, you... Because there's some people, like I said, that can sugarcoat it. But you actually said to him, "No, you need to get someone that's going to make you accountable, like a trading partner, that's got a list of rules." [inaudible 00:45:09], "Okay, you didn't get the trade, what are you going to do about it?"

Allen: Right.

Craig Davis: And that kind of thing. I thought, "Yeah, I like that." Because that's what you need, is everyone, "Oh, yeah, it will be fine [crosstalk 00:45:19]." You want someone to know, really to... Yeah. So I thought, "Okay, yeah, you seem like a serious guy. You want people to benefit."

Allen: I learned from experience. That was my wife. That was my wife standing there telling me, "What are you going to do to fix this?"

Craig Davis: The best trading partner, yeah. Yeah, but that's a good incentive as well.

Allen: Yeah, every day she would come up the stairs when I was at home. Every day she would come up the stairs and stand there until I talked to her.

Craig Davis: Yeah, "What have you done? What are you doing?" So yeah, so there you go. Behind every strong man there's a strong woman, I could imagine.

Allen: Oh, yes.

Craig Davis: Like I said, so for me, that's what got me onto the parcels. And there's programs. I seen yours, I listened to that podcast, and I looked into some of your things and I thought, "Okay, I want to be an expert, so I'm going to have to put the money in. Because why not pay, say, 297 dollars if it's going to say..." I'm telling you before I was not an ambassador. I don't know why I wasn't listening before. It's like I just have the theoretical, I had to practically...

[inaudible 00:46:41] like the insurance, if it can save you money, I don't mind spending 297 dollars going in the forum, and it's going to save me 3000 dollars or something like that down the road. I haven't got a problem with that anymore. Before I might've been, "Oh, I'm going to risk it." No sense. Because it could be worse. Because as I said, there is no...

Allen: You mentioned a couple things. You said the weekly iron condors. I would not do that.

Craig Davis: Well, so don't do the weekly ones, [inaudible 00:47:18].

Allen: Those are for experts, and those are for people who like to gamble. If you don't have the money to risk, I would not do that at all. I would stay with the monthly.

Craig Davis: Yes.

Allen: The weeklys, you cannot adjust them. I'm sorry. I don't care what other people say. They just move so fast, that you cannot adjust.

Craig Davis: Right.

Allen: And the money that you make is so little, that you're only trying to make five, six percent. But that thing could, you know, you sell it for 20 cents today, tomorrow it could be a dollar, what now?

Craig Davis: Yeah.

Allen: You can't do anything. I learned the hard way that those are very dangerous, and they...

Craig Davis: Yeah.

Allen: And the [crosstalk 00:48:01] Kiasaki, he gets paid a lot of money from that Andy Tamura guy, to just be the head. You know?

Craig Davis: Yeah.

Allen: He will just use your name, and your picture, and your video, and... I mean, I love his books, I love his books, and they make a lot of sense, but yeah, so be careful of those. [crosstalk 00:48:30].

Craig Davis: He doesn't recommend the weekly options [crosstalk 00:48:34] for him. He didn't recommend that. I did see it on the Udemy, where it says, "How to make money selling options doing this weekly..."

Allen: Oh, I see, I see.

Craig Davis: So for me, I was looking at it as a learning exercise, where what is the difference between doing this weekly iron Condor to the monthly? Because they do say do it for 45 days, and do this.

Allen: Right.

Craig Davis: So, I was just looking into the process, but yours seems like you've got the accelerated version, where you've got the whole package there, you're going from start to finish, and this and that.

Allen: Yeah, I mean, and if you have any questions or anything, you just email me, I'll help you out.

Craig Davis: Yeah, definitely, definitely.

Allen: If you need anything, just let us know.

Craig Davis: Yes, yes.

Allen: But really, take the plan, do the back testing, if you can afford it.

Craig Davis: I will.

Allen: I haven't checked, there might be something out there that's cheaper.

Craig Davis: I can have a look. So if I literally Google, is it called like back testing software? Is it like that, or is it-

Allen: Yeah, so just option back testing software.

Craig Davis: Okay.

Allen: You might find something. I know this company that I use, on the screen, the Think or Swim, they have something for back testing.

Craig Davis: Okay.

Allen: It's included, it's free. It's not very good... I think it's right here, Think Back. So, it's not the best, but it's free.

Craig Davis: Okay.

Allen: You can go back in time, so let's say you want to go back a few years, go back to this day. So it'll tell you, "Okay, SPY on that day was 131." And I think this is a chart for it.

Craig Davis: Yeah.

Allen: It gives you all the prices. So, you can put on a trade and then just go through it and see. Just go day by day. Like, "Okay, this is the 7th, today's the 8th, today's the 9th, how's my trade doing?" It's not as good as the other one, but then again, it's free.

Craig Davis: Okay. I can have a look at it. I have seen the Think and Swim. I don't think they're taking account for the UK anymore.

Allen: Oh, I didn't know that.

Craig Davis: [crosstalk 00:50:42] Interactive Brokers.

Allen: I see, okay. That's horrible. Tasty Trade... Or, no, Tasty Works is another one.

Craig Davis: Okay, let me try that, Tasty Works, yeah.

Allen: They're a newer broker, and I know they opened for Australian accounts, so they might be probably open to you guys too.

Craig Davis: UK, okay.

Allen: And they are, you know, they focus on options.

Craig Davis: Oh, excellent.

Allen: They have a lot of educational stuff as well. Some of their stuff I agree with, some not.

Craig Davis: No worries.

Allen: Okay, so the guys who, they're the same guys who made Think or Swim.

Craig Davis: Oh, okay. Oh, that's good.

Allen: In the past, they were floor traders on the exchanges. Then they made Think or Swim, and you know, they started doing videos, and teaching people. They were the ones that told everybody to do the iron Condor without adjusting.

Craig Davis: Really?

Allen: That's how they got popular, yeah. And then they sold this company to Ameritrade for millions and millions of dollars.

Craig Davis: Okay.

Allen: And then after they have the buyout period, where they cannot do anything for a lockup, they cannot do anything for a certain amount of time. Then once that period expired, then they went and they opened another brokerage.

Craig Davis: Oh, okay.

Allen: They're still out there, making videos and whatnot. So, they have a lot of content that people like. But they might, let me see if they open accounts in the UK. I think they do.

Craig Davis: Okay, I'll have a look. But like as I say, with this Andy Tamura guy, you mention weekly, but he says safety, so that's where I got the safety element. But yeah, he definitely was saying, "Grow small, take your time. [inaudible 00:52:43] paper trades."

Allen: Right.

Craig Davis: But no, I don't think he wouldn't have said anything about [inaudible 00:52:49] saying about, "How do you have a losing strategy?" And rather than taking the maximum offer, he was the one that [inaudible 00:52:58]. So that gave me the idea. That's what I was leaning to. Because he said, "How do you turn a losing trade, so you don't get the max loss, and you're sort of not [inaudible 00:53:07] after having the max loss?"

Allen: Yeah, so that's basically talking about adjusting.

Craig Davis: Yeah, yeah. So yeah, man, Think or Swim [inaudible 00:53:25] said to do that, wow, they would've believed it.

Allen: Yeah.

Craig Davis: Well, like as I say, if it were, it depends on what context. Yeah, if they break even after 10 years and that.

Allen: I was shocked, I didn't know that. I hadn't done it, my friend did it, and I was like, "Wow, really?"

Craig Davis: Wow. If something sounds too good to be true, it most probably is or something, they might say. But no, I'll look for that. I'll look for the Tasty Works. If I can start an account, then I can look at that.

Allen: Yeah. The only reason I tell you that is because their software might be better than Interactive Brokers.

Craig Davis: Ah, okay.

Allen: It doesn't matter which one you use, but their software, because they are focusing on option traders, so their software might be better. And they're newer, so they'll respond to you. I know Interactive Brokers, they don't really respond very well. Their customer service is not the best.

Craig Davis: Right, that's all I need to know. You've got a problem, you can't get a hold of anybody.

Allen: Yeah, I opened an account with them, and I couldn't even figure out how to use it, seriously. And so I emailed them, and I didn't get any response. Then I canceled the account, and then they contacted me. They were like, "Why'd you cancel?" I was like, "Well now you contact me."

Craig Davis: No, that's not the best way.

Allen: I think they are the cheapest, but you know, you really have to know what you're doing.

Craig Davis: Yeah. [inaudible 00:55:08].

Allen: Yeah. So you have your game plan?

Craig Davis: Yes, I have definitely... Oh, man, Allen, you're a top man, you're a superstar. I've definitely got a game plan. You gave me so much food for thought, hints and tips. I've been writing down some things. I know you're said you're recording, but let me just write it down while the inspiration's there. Yeah, I'm definitely more [inaudible 00:55:30] focus on these and back testing of the plan, which I never thought about, which makes sense, just to get confidence. Not confidence, but at least I can, what's it called, develop the skill of putting on the trade, and making sure I'm doing it properly. So yeah, yeah, I like the sound of it.

And plus, yeah, I can view like how many trades over how many years in like a few minutes, so I like that. That's good. Then I could just say, I just have to get used to the [inaudible 00:56:00] where I'm coming forward, the volatility in that. So yeah, man, definitely got a game plan to go forward with. Looking forward to be working with you, and being part of this [inaudible 00:56:14] team. It's going to take me a few days until I digest everything, and get into it. But, I'll definitely be staying in contact, and if there's anything else that [crosstalk 00:56:27].

Allen: It's interesting, it's fun, but when you're doing it, it's very boring.

Craig Davis: I'm glad you're telling me that, that's okay. They say the good plans are the [inaudible 00:56:40] ones. So it sounds like I've got a bit of a...

Allen: Yeah. Like, yesterday the market was down, so it was exciting. It was like, "Oh my God, what do I do? I got to do this, I got to do this." Today, market is flat, and I've got nothing to do today. Most days you don't do anything. You just sit there and wait.

Craig Davis: Waiting for something.

Allen: Yeah.

Craig Davis: Man, I didn't do an adjustment or something, or I didn't do this, didn't do that.

Allen: Yeah.

Craig Davis: I like it, I like it. So, that's where the boring part comes.

Allen: Yeah. That is also something that you're going to have to learn with experience. You might adjust sometimes too soon, sometimes too late. It's a fine line. Like, we'll give you rules that say, "Okay, if this happens, you adjust."

Craig Davis: Yeah.

Allen: But there's always the thing that, you know, "Oh, if I didn't adjust, it would've worked out great. If I had waited another day or two, it would've worked out great." So, that always is there. When you have a firm set rule, it doesn't always work out in the best way. That rule will work most of the time, not every time. And so as you get experience, you'll realize that, "Okay, I know my rule says to adjust, but I am going to wait one more day, because I see something something on the chart, or I think this is going to happen," or something.

Craig Davis: Yeah.

Allen: That's why we don't give Vista computers. This is why we do it ourselves. Otherwise, we could just make a computer program, and let it run, and hopefully it works.

Craig Davis: Yeah. No, that's fine. No, I like it. Yeah, man. Allen, definitely [inaudible 00:58:28], it sounds like you've done a great journey. You're a great teacher, and you want to encourage people. I'm glad you've got your course, and the website, the podcasts. Yeah, man, I'm glad that you've even got this thing, where if you want to speak with you, to donate some money. So even that for me, that's a learning for me as well. But yeah, man, this is definitely much appreciated. Definitely. Plan everything for everything.

Allen: Great. I hope I was helpful, and like I said, going forward, you need anything, just email us. We're here.

Craig Davis: Yes, definitely, man. I'll email you guys. Yeah, man, definitely much appreciated for the help and support. Definitely much appreciated. Thank you.

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
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Jun 11 2019

1hr 4mins

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Rank #3: The Five Finger Strategy - 004

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Welcome to another edition of the Option Genius podcast. I'm your host, Allen Sama. Today, I want to be talking about something that I call the Five Finger Theory or the Five Finger Strategy, if you will. Basically, this is something that I think is very, very crucial to your success. Not maybe your trading success, but definitely your overall financial success. I think it's, super, super important. I call it the Five finger Strategy. That's my personal twist on it. Now, you might have heard somebody mention something in the past about multiple streams of income, so it's kind of like that but it's my own take on it.

This particular strategy will help you overcome the financial pitfalls that happen to everybody. It's my opinion that you need five fingers in your life, or five separate, distinct sources of income. Now, I don't care how rich you are. If you only have one or two fingers, it can all be taken away from you very, very quickly, and in some cases over a night.

Links:

https://optiongenius.com

https://optiongenius.com/blog/79-alternative-investment-platforms/

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
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Nov 08 2017

22mins

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Rank #4: Option Selling Defined - 015

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

I realized that we have done many episodes already where we talk about why you should be selling options, but never gave an explanation.

Option sellers trade in a market neutral way. So you don’t need to market to go up or down. You can trade it when it doesn’t even move.

Also, option sellers have probability on their side. So we do trades that have for example a 70%, 80%, or even 90% probability of working out in our favor. These calculations are done using sophisticated statistics and mathematical formulas that won the Nobel Prize.

In addition, to be even safer, we use other risk management techniques like stop losses, and spreads which limit our losses.

And the example given was the insurance company. So just like the insurance company collects premiums so do option sellers.

In fact, the insurance company analogy is a great one.

Because as well talked about in 8, the real reason options were created were as a way to lose money. They were created as a hedge. As insurance.

So the option seller acts as the insurance company be selling options to farmers, manufactures, and investors who are looking to protect their positions.

That’s one way to describe the option seller.

The second is as a casino or more accurately as the house.

The house takes bets from gamblers and has the odds in its favor. Over the long run, the house always wins.

For us, the gamblers are called speculators. These are the option buyers who are betting against the odds hoping for a big payday. Kinda like lottery ticket buyers. The option seller is the house, and takes the other side of the bet. Once in a while, the option seller loses, but over time, the house always wins. It’s just math.

And with the odds in my favor, I don’t care which way the market goes.

I don’t have to predict. If I want to do a bullish trade, I can, but I don’t have to be right to make money.

This removes so much of the stress.

When you have a 70, 80, even 90% chance of winning on a trade, you don’t have to be the best trader in the world to make money.

You see, when you buy a stock it has to go up for you to make money.

And if it does not, then your money is just sitting there not earning anything. Unless it’s a dividend stock and you get some measly return like 2%.

And if it goes down then you lose.

You have to be right about the direction.

It is the same with buying options, except it is exponentially harder

Not only do you have to be right about the direction, but you have to know by when the move will take place, and how much the stock will move. If you are wrong on any of those three elements, you lose.

Here’s the magic:

When selling options, you get to play a range. The stock does what it does and as long as it stays in the range you want, you win.

Let’s use golf as an example.

To make money with stocks you have to get the ball into the hole in 3 strokes.

To make money by buying options you have to hit a hole in one.

To make money by selling options you just have to hit the ball onto the course.

One additional point I want to make is that emotionally, winning more often does wonders for your self-esteem and confidence. And as a trader, having confidence in your trades and yourself is a key factor to success.

Because with selling options, what we are doing is hitting base hits. Over and over. Not trying to hit home runs. Because you know what happens to the guy who tries for home runs – he strikes out most of the time. And in investing, a strike out means losing money which is not a good thing.

The episodes continues with examples of. Listen to the whole thing to get the complete picture.

What to Learn How To Sell Options? Get Our Free Course at - www.optiongenius.com

--

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Jan 21 2018

26mins

Play

Rank #5: The Path To Options Trading Success - 46

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

What is the best way to learn how to trade?

Is there one best way to learn trading?

That is what I cover in this episode...

Hey, hey, hey, genius nation. How are my passive traders doing today? How are you feeling? What's going on? You know what I love? I love when you guys reach out to me and when we can communicate back and forth. So whenever one of you or if you have an issue or if you had something that you want to say to me, I would love it, and I do love it. It's one of the highlights of my day when I get a comment. If somebody, maybe they post something, they email us, or they post something on our blog as a comment or one of our Facebook groups, our free Facebook group, if they're a member in there. If you're a member, go ahead, let me know how you're doing today. Let me know what questions you have. Let me know how we can help you, myself, or my team or anything.

But I do understand that sometimes you might have a situation where you don't want to make it a little bit public. Blog post, comments, and Facebook groups, and when you write a review for the podcast, those are all pretty public, and people can see that. And I understand that if you have a longer issue or if you have a longer comment, then you can always email us. I love getting emails. We get several emails every day and the ones that my team can answer, if you're asking a question like, "Hey, what's the best broker to use," then my team will handle that. But if it's a more detailed question, if it's a personal issue or a trading issue, then I have those reserved for me, and I take some time every day to answer those.

And that's really part of how I feel that I am able to give back. So even if you're not a member of one of our services or one of our courses or whatnot, if you do have something, please reach out to us. We'll do our best to help you out as much as we can. That's getting us to our goal of helping 10,000 individual investors achieve financial freedom. So if we can do that without you giving us any money, then that's fine too. As long as it gets you to where you want to go and makes the world a better place, I guess.

And so today's podcast, I had a lesson that I wanted to impart upon you, and I'm going to cover that. But we got an email recently that was very lengthy, and it was confusing. It had me scratching my head for a little bit. It was a aggravating. It was really annoying in a way. I don't know. I mean, it gave me so many different emotions as I was reading his email that it totally confused the heck out of me. But when I went through it a couple of times, I read it two, three times, and I realized that the person that wrote this email really, really needs the lesson that I'm about to impart.

And so I thought that he would be really awesome if I could share with you just a few lines from this email. It was very lengthy. I'm not going to read the whole thing but just a few lines to get you into the framework to understand what that guy was thinking and what that guy was feeling when he wrote this. I did respond to him, and I gave him suggestions on what he can do because that's what he was looking for. But in this podcast, I want to go through that lesson to see how it applies to this.

Okay. So now I get this email. We get emails every day, but I got this one email, and it was very lengthy, and I was like, "Okay, this is going to be a good one," because he wrote, it was several paragraphs. And I'm going to read some of the things that he wrote. He started off by saying that, with pleasantries, "Hey, how are you doing? I've been following you," blah, blah blah. And then he goes on, and I'm going to read some of the lines. So he starts out by saying that, "I've heard options are manipulated. This is not an easy market, and hedging positions is important." Now this is one line of one paragraph. Okay, so I'm going to bounce around.

I'm not reading the whole thing. I'm just taking single, single points to get you to understand what I think is going through his mind. He wrote really long. So that was the first point that when I was reading through it, I was like, "Okay, I want you guys to hear this." And then then he says that, "I think most traders fail because they are the Jack of all trades, and they switch from stocks to futures to options to currencies without developing the skills in one." And at this point I'm like, "Okay, this guy, he's preaching to the choir." He knows what we're talking about because we're always talking about get that one strategy, and if you're going to be jumping around, you're not going to ever be good at anything. If they got, dive deep, gets good at something, be consistent, be profitable before you add something else. So I thought, this guy, he's been listening. He gets it. He understands it.

So let's keep going into the email. Then he says that, "I'm thinking about taking an options course." I said, "All right. That's cool." He goes, "I belong to an alert service now, and I'm happy with it." Okay, that's awesome. And then he says that, "I have a full-time job, 60 hours a week, and I cannot dedicate to trade full time right now. But that's my goal." I say, "All right, man. You are like so many of our clients, of our members, and our customers. That that is the goal, right? Maybe you can trade a little bit. Maybe you can trade during lunch. We can show you how to do that."

But that's what his goal is, and I commend him for it. So then he says, "I understand where you are coming from with money spent on education. As I have spent," this is him talking, "As I have spent $25,000 so far and not placed a single trade just yet. I am preparing to set up an LLC as I am at the point where I will start swing trading stocks soon." Now at this point, I was getting confused. I say, "Well, wait a minute. Well, hold on a second here. You work 60 hours a week. You don't have time to trade full-time or even really, 60 hours a week. You have a alert service that you're paying for every month, but you have not done a single trade ever. You've already spent $25,000 on education, but you have not done a single trade. You're paying for a service that gives you trades, and you're happy with it. How can you be happy with it if you're not making any money from it? I don't understand."

I'm confused at this point. I'm very confused. And then he goes further. He goes, "I am preparing to set up an LLC." You're preparing to spend money to set a corporation to trade in, but you have never traded a single share before. How do you even know it's going to work? Why are you going through all this extra hassle and wasting time? And then he says, "I'm at the point where I will start swing trading stock soon." Okay, you going to swing trade. All right, good. You made a decision. You're going to do something, awesome, great. I commend you for that, but then why are you telling me in the previous paragraph that you were thinking about taking an options course and that you belonged to an options trading service? This makes no sense to me. I don't understand. Help me. Please somebody explain what's going on here.

Then he continues. He's going on. He goes, "Two of my mentors day trade futures and swing trade stops." Okay. The next line, the very next sentence it says, "I would love to be coached and mentor to learn options." Again I'm like, "Wait a minute. Whoa. You have two mentors that do futures and swing trading stocks. They're two different things, right? Kind of similar but still two different things, and now you want a coach to trade options. You want to be mentored in trading options." Okay, I mean, coach, you want to get a coach. Coaching is not cheap, right? To have a tab, somebody actually work with you one on one as a coach, as a mentor, that's not cheap. But you want to spend the money do that even though you've never done a trade yet.

And then he continues. He goes, "I will be in webinars all day Thursday as I am attending the something something summit." Okay. It's just pitch, okay? It's people pitching product after product after product after product. So a guy comes on, tells you how good his trading is and that you should buy his product. Next comes on and talks about how good his trading is, and you should buy his course. Next guy comes in and says, "Oh, I'm making tons of money. You should buy my course." That's what a summit is. You get guru after guru after guru coming on, giving you really no information and then just pitching product after product after product.

So he's going to be spending all day, all day Thursday, listening to these gurus pitch their products while he works 60 hours a week, right? So he's working 60 hours a week. I guess he took the day off for this. I don't know. And then he says that, "I've attended the summit two years," so he's gone to this thing for the past two years. This will be year number three. Supposedly he's getting something out of it because he's spending all this time on it. But again, then he's never placed a single trade.

I have no clue what's going on. Then the next line, it goes, "I enjoyed your presentation last week. It will probably take me four months perfecting your strategy." He enjoyed the presentation that we did. We did a training, and he was on. That's why he was writing in because he wanted to talk to me. So then he goes on and says, "This is my phone number. Please call me. I'm available after dinner time. Please call me at night after dinner time." And it's, okay, well, first of all, dude, I don't know what to say to you, right?

There's so many different things in your email. You start off by saying, you think our options are manipulated, and it's not an easy market to trade. Okay. And then the bottom, you're telling me that you can probably, it's going to take you only four months to perfect the strategy that I was talking about. So the strategy that I showed on the training, which is already not perfected. Nothing is perfect, but I showed the way I trade, my particular strategy, and he wants to take four months to perfect it, meaning I guess improve it or make it better than what I'm doing. But then here's a guy who has never done a trade before in his life, and he thinks he can perfect something that I've been doing for the last several years.

So that's where I was. That ticked me off to be honest. But do you see? I mean, I don't know. Maybe you can see yourself in this, where this guy is completely, completely bonkers. He's confused, and I don't blame him. His heart is in the right place. His brain may be not be in the right place, but he has his goal set that he wants to retire, and he's working hard. I mean, I got to give him credit for that. It's not easy working 60 hours a week and trying to learn how to trade and make yourself better.

But what I do fault is, how do you spend money month after month on something? How do you spend $25,000 without even trying a trade? And okay, fine, maybe you got suckered into it. Maybe somebody did such a great sales pitch that you just got suckered into some product. Okay, I get that. It's happened to all of us. You go to a seminar or whatnot, and you think it's going to be great, free information, and at the end it's like, "Okay, here, sign up for $5,000 program." Okay, we do it because they make you such an awesome, amazing offer that you think you can't fail. But then we learn, oh, that it's not the truth, but okay, even, oh, that's fine too. You spend $25,000. Okay, fine.

But the fact that bothers me is that he's still spending time going to sales pitches. Why are you spending time going to sales pitches when you have all this training or whatever that you already have that you're not using. Number one, you're not using any of it. You haven't done a single trade. And then you're going to the next step of making a corporation to trade in. I mean that is, if you are already a professional trader, if you are already making a very, very good amount of money, then you should go and look at and say, "Yeah, what, I'm going to start open a company," and we've talked about that in a previous podcast.

So if that's something where you're at, then you can listen to that podcast. But if you have never done a trade before, you don't need to worry about anything about setting up a company to trade in. You need to worry about A, putting a trade on, and B, not screwing it up because you're going to screw it up, especially in the beginning and to tell me that it's going to take you four months to perfect something that I'm already doing every day, where are you coming from? You have all this confidence. You've never done a damn thing yet. Jeez.

So, I mean, hopefully you're not in this situation where if you are, then it's very simple how to get out of this situation. Number one, stop wasting your time going to pitches, okay? Stop reading emails where all they do is try to get you to buy something else. If you have to, unsubscribe from that list, okay? Because a lot of these companies, that teach you how to trade, right, that's all they do. They sell you a very cheap product. Maybe it's seven bucks or 20 bucks or 50 bucks or 100 bucks or whatever. And then every day you get bombarded with emails about how you should buy one of their other products, and they have 10,000 other products, and they're all great, and they're all making millions of dollars, and they're all, you could triple your money in two weeks in all of them. But it's all BS, right?

So get off of these email lists. Get off all of that. Pick one thing, right? Pick one thing that you can do, that you want to do it. This guy tells me he wants to do swing trading. Okay, fine. Go do swing trading. Get away from options. Get away from futures. Get away from currencies. If you want to swing trade stocks, go swing trade stocks, right? Why are you on a options trading training? Why are you going to this summit? All of them are not talking about swing trading. They're going to be talking about all kinds of stuff, and then you're going to get sidetracked again, right? When you are learning, when you are trying to do something new, when you are trying to improve your situation, the tendency that we all have is to learn everything we can about it. Okay.

And this is the lesson part. When we learn, and for some reason, we look at trading because we don't know any better when we're starting out. We look at trading as trading, one big umbrella. So stocks, buy and hold, is the same thing as swing trading is the same thing as futures as currencies as options, cryptocurrencies even. All these things get lumped in together in our brain as trading. Say if your goal is, "I want to become a trader," or "I want to make 5,000 bucks a month from trading," right? That's your goal. We think that if we read a book on stock options, we're getting to our goal. If we read a book on swing trading, we're getting to our goal. If we're taking a course on technical analysis, we're getting closer to our goal. If we're learning about buying a course on futures, we're getting to our goal. The truth is we're not because each of those is a separate path. Each of those is a separate road that is taking you further and further away from your goal. Basically, you're just going around in circles. Does that make sense?

I've said this before many, many times. We need to pick one strategy even when it comes to passive trading. There's dozens of strategies that you can use to sell options, but we don't focus on dozens of strategies. If you're starting out, you focus on one. You get good at that, and you study that, and you practice that, and then when you're consistent and profitable, then you add strategy number two if you need to. And then maybe you go to strategy number three. You really don't need more than three strategies to be honest. You can make a very, very, very nice living and trade really well and have a awesome, amazing return every year with just two strategies.

And then there are those people that I know that do amazingly well, trade for a living, with just one strategy, just one. That's all they do. They master it. They pick one. They go at it, and they master it. That's all they do. So if you want to succeed at this, that is the path. The path is not to open a company before you ever done a trade. The path is not to spend $25,000 and never do a trade. The path is not to have an advisory service give you trades, and you never do them. The path is not to say, "Oh, I have mentors and this and this, but now I'm going to go learn something totally different." No, those are not the path. Those are distractions. Those are side, whatever they're called. They are not taking you to your goal. You want to get to your goal? You need to simplify it. You need to make it cut down as much as possible. Get rid of all the noise, and then you focus on step by step.

Okay, this is very important. You pick a strategy. You learn about that strategy, and then you implement it. You go out. You get a paper trading account, and you go out and you get a backtesting software. You go out, and you just do the trade. You don't even have to know everything about the trade. You don't have to know everything about how it works. You don't have to know every single adjustment. You don't have to know anything really except how to put on the trade and a basic idea of how the trade works. Once you have that, you go, and you put on a trade. Make it a very small trade if you're losing real money, okay? If you're using paper money, go and do it. That's what you should be doing. But if you're using real money, you go out, and you put it in a very small trade, so that if it does lose money, it's not the end of the world, okay?

And then you see how the trade reacts. And then you get to another point in your progression, and then you'll get stuck. You'll say, "Oh, okay. I put the trade on. Now what do I do?" Okay, well then you learn, and you go investigate. And you say, "What do I do now? Oh, I just have to wait. Well, okay, all right. I'm going to wait. All right. Oh, hey, my trade's making money. What do I do now?" Okay, well now you can go, and you can learn the next step. You can learn the step of what do I do when my trade is making money, right? And then you have different options. "Do I let it expire? Do I get out at a certain percentage point, or do I have a stop loss? What do I do?" Right? And then, "Oh, what about if my trade is losing money? What do I do now? Oh, my God."

Okay, well at that point you learn what to do about that. You say, "Okay, I need to adjust my trade. All right. How do I do that?" Well, go find an adjustment and see how it works, and if that does not work, then you go, and you find a second adjustment. You don't need to learn 20 different adjustment strategies before you even put on a trade, okay? What I'm saying here is to take it step by step. One thing, learn about it, learn about that step, then go to the next step, and then learn about that step, and then go to the next step and learn about that step.

This will get you to your goals so much amazingly faster than all of the other people who just sit around and just get educated, get educated, get educated, get educated, and never take a single action, okay? If you want to get ahead, if you are an action taker, if you want to make this work, you have to put on the trade. That's the biggest hurdle. I don't know why people think that just, I'm just going to learn about it and learn about it and learn about it and learn about it and learn about it, and I'm actually doing something. You're not. You're wasting your time. If all you're doing is learning, you're wasting your time if you are not implementing what you're told to do.

So for example, this guy, if he wants to do swing trading, get out there and put on a freaking trade, okay? If the trade does well, then you figure out, what do I do now? If the trade does badly, it starts losing money, then you figure out, what do I do now? Okay? While you are learning, this is the fastest, fastest, fastest way to succeed in anything, right?

I mean, if you are trying to bake a cake, you don't need to know all the nutritional properties of every single ingredient. You don't. You need to know step by step what do I do. Okay, you take the onions. Oh no, not onions. You're trying to bake a cake. You take the flour. All right. What do I do with flour? Okay, go on Youtube. Find a video on how to, whatever they do. They knead flour I think, so here, knead the flour into dough. I guess, I don't know. I mean, I've never baked a cake before. I'm sorry. I don't know what the steps are, but you take something, and you do something with the flour, okay? Okay, now I'm done with the flour. Now what do I do? Okay, I think you got to bake the flour or something, so, okay, how do I do that?

Learn how to bake it, put it in the oven, put it on certain degree. Okay, fine. I'm done with that. Now what do I do? Okay, now I got to put the icing on it. How do I do that? Okay. Find out how you do the icing. Okay. You go, and you make the icing, or you go, and you buy the icing. Okay. Now I'm going to decorate the cake. Okay, cool, step by step by step. If you sit there and you go, and you read a book about how to bake a cake, right? You just spent, I don't know how many days in reading a book about how to make a cake, but you still don't have a cake. If you do it the way I just told you earlier, hey, you might have the worst cake ever, but guess what? You are now a baker. You baked a cake, okay?

So now you take and you say, "Hey, I baked a cake," and somebody's going to come and say, "Well, you baked a horrible cake." "Well, yeah, I know, but I baked a cake, right? So that's good. I have one cake under my belt." And then if that other person knows how to bake a cake, they'll help you. They'll point at, "Okay, you did this wrong. You did this wrong," and then you can go, and you can fix it. But you are not afraid anymore. You're not afraid of baking a cake. And when it comes to trading, you're not afraid of putting on a trade. I mean, maybe that submit button, you put in the order, but that submit button, maybe that's the scariest thing in the world right now because you're afraid of losing money. The only way to get over that fear is to hit the button, to actually do it.

And if that's the case, then find the trade that has the least risk, that has the least amount of money, that even if it goes horribly wrong, and you lose 100%, it's not going to kill you because that experience that you get from doing that is going to be immeasurable. That confidence that you get, that "Yes, I did it. I finally did it. I finally put on the trade," immeasurable. So depending wherever you are, whatever path on the option continuum you are, maybe if you're option level two, five, six, whatever, doesn't matter where you are on your phase of learning options, forget all the noise.

Do it step by step. Do take an action and then figure out, "Okay, now I'm at a roadblock. Now I need to know, what do I do at this point?" And then you figure that out and then you take the next step and then, "Okay, I'm at another roadblock." Then you take the next step. Then you take the next step. And not only that, but when you ask for help, it is so much easier for somebody like me to be able to help you out, right? Because you've already done something, and you have a specific question. "Okay, I wanted to do a credit spread. I put on the credit spread. Now this is my situation. What do I do?"

Okay, that is so much easier to answer than this fellow's email because he was all over the place. I don't even know what he's asking me. He's swing trading, but then he's starting his LLC, but then he can't work, or he works too much, and then he's going to all these different trainings. I mean, even if he takes my course, do you think he's actually going to listen to anything I ever tell him, or is he just going to go to the next course next week, buy something else, and learn about that, and then go learn something else? I can't help you if you don't implement. Nobody can.

And if you're so vague, and please don't tell me to call you after dinner time, right? I mean, I have a life. I have kids, have family. I'm not going to call you after dinner time. If you want to sign up for our coaching, then you can sign up for coaching or one on one coaching. That's fine, but it's going to be done at a time that I can do it, right? So, I mean, I really appreciate it, this guy reaching out, and I tried to help him as best as I could, but there's only so much you can do for people that are rudderless. You're in the ocean. You don't know what direction you're going in, and you don't know how to get there. But if you pick a direction, right, and then you want to learn something, the fastest way to do it is step by step.

Do not try to learn every single thing you can do without taking any action. Once you get a few trades under your belt, once you get a few successes under your belt and a few losses as well, then you will have a much better idea of, "Hey, what do I need to focus on? What do I need to learn? Where are my blocks?" And then you can go and totally jump in and master that one particular strategy. Don't try to master all, every... Even when it comes to options trading, there is nobody that is an options master, that knows everything about options, that knows about every single strategy and is consistently profitable with every single strategy because it's all very difficult, very complicated to learn everything.

That's why you need to niche down. You need to keep it as simple as possible. Learn step by step because you are not a guru. You are not a trainer or a trader or a mentor to a million other people, right? You are responsible for your own trading account, and in that sense, all you have to do is make more money, have more money at the end of this month than last month. As long as your account balance is growing, you're in a good spot. And that's the goal. More money at the end of every month, profitable trading, consistently, consistently profitable. That's all you have to worry about.

Some people telling me that, "Oh yeah, I want to learn the most complicated strategies." You don't need to. It's not about showing off, right? If you make money every month with the most basic strategy, the bank doesn't care, right? Nobody else cares. Your wife is not going to think any lower of you because you did it, you're making money with covered calls instead of ratio spreads or box spreads. Nobody knows. Nobody cares. As long as you have a profitable trading account, that's all that matters.

Your broker doesn't care even. Your broker knows what you're doing in your account, but they don't even care, right? As long as you are consistently profitable, you are a good account for them. You're doing more trades. You're making them more money. You're going to stick around. That's the kind of person that they want. They don't want somebody who's going to open account and trade and blow up and leave in a couple of months. They want the trader that's going to be there for a long, long time to give him commissions month after month after month. Those are the types of people that they like to have accounts, and those are the type of people I like to work with that can focus on one thing, learn, grow, grow, grow, and then add other things as well.

That's what makes it fun. When you're making money, it's fun. When you're just learning, you have that false sense of I'm actually doing something. I'm actually moving forward. I'm learning, so that when I do finally started to trade, all this knowledge is going to just rush out and make me profitable. Like he says at the bottom, it's going to take him four months to be profitable. No, I don't think so. Not with all the other stuff that he shared. I mean, I don't even know if he has a trading account set up yet.

So, take it small, step by step. That's the lesson for this podcast, okay? Step by step, take it small. Don't need to immerse yourself in all the noise. Don't need to learn everything. Implement, please put on a trade, and then see where it goes. And then when you get stuck then research what you need to do next and then implement more. And then you get stuck, and then you research more, and then you learn a little bit more, then you learn a little bit more, then you learn little bit more. The trade is over, and then you're either successful or not, but you've had done a trade. You're experienced, right?

And then we have to add more and more and more experience. Do more and more and more trades, so that you learn more and more, and you learn faster. The more trades you put on, the faster you're going to learn because the more things that could happen. And the more you'll have to figure out, "Okay, what do I do next?" So that is what I wanted to impart with you today. Take it to consideration, right? And put something on please. I know it feels good to learn stuff. I know it feels good to listen to even podcasts, right? I know you're listening to this, but this is all a waste of time if you cannot go and put on a trade. If you don't that, then there's no reason for this, okay?

So please pick a strategy that you like. Put on a trade. If it's on paper, fine, great, I don't care. That's even better because you're not losing anything. Just put the dang thing on. See how it does, and then see where the roadblocks are. Learn the next step and move forward and then move forward and continuously moving, moving, moving forward. Because then when you're actually doing stuff, and you listen to podcasts, or you get more education, or you read a book, or you take a course or whatever, then you will be able to take that and apply it to what you're already doing, and it'll ROI immediately. Does that make sense? I hope it does. Remember, trade with the odds in your favor.

www.optiongenius.com

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
  3. WATCH THIS FREE TRAINING: https://passivetrading.com
  4. JOIN OUR PRIVATE FACEBOOK GROUP:  https://optiongenius.com/alliance

Like our show? Please leave us a review here - even one sentence helps. 

May 09 2019

23mins

Play

Rank #6: Case Study: How To Make 168% Returns in One Year - 60

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

What would a good yearly return be for you? What would you be happy with? 10%? 15%? 25%?

Our goal at OptionGenius is to make 10% a month. We don't always get there and we sometimes lose money but even if we average 5% a month, that is a great year.

Well in 2019, I made 168% and in this episode I want to share how I did it and how you can do it too, and why I think that 2020 will be just as good a year as 2019 if not better.

https://optiongenius.com/oiloptions

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
  3. WATCH THIS FREE TRAINING: https://passivetrading.com
  4. JOIN OUR PRIVATE FACEBOOK GROUP:  https://optiongenius.com/alliance

Like our show? Please leave us a review here - even one sentence helps. 

Feb 04 2020

18mins

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Rank #7: The 0 DTE Trade - 58

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Selling options on the day of expiration is all the rage right now. In many online forums and groups there are traders who are bragging about how they are making great trades and profits by selling options that have very little time left to expiration.

Is this something that you should consider?

Isn't it risky to sell so close to expiration?

When you sell close to expiration, time decay works very quickly. But most of the value of the option has already been lost. But you can still earn a good percentage especially since you will only be in the trade for a few hours.

Check out the episode to see what strategy works best for 0 DTE trades and if the risk/reward is something you should be looking into.

For more info on selling options visit https://optiongenius.com

To learn how I trade weekly options and make 5% per week: https://weeklytradingsystem.com

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
  3. WATCH THIS FREE TRAINING: https://passivetrading.com
  4. JOIN OUR PRIVATE FACEBOOK GROUP:  https://optiongenius.com/alliance

Like our show? Please leave us a review here - even one sentence helps. 

Jan 20 2020

13mins

Play

Rank #8: Teach Your Kids How to Trade - 003

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Imagine giving the gift to your kids of them being able to follow their calling, whatever it is. Maybe they want to be a social worker, maybe they want to be a missionary, maybe they want to be a world traveler. Right now, if they go get a marketing degree or an accounting degree or whatnot, they can't do it. They don't have that freedom. Imagine them having the ability to follow their heart and their freedom, not worrying about money because they know how to go into the markets and just take it out at will. That's what option trading, the way we do it, gives you that opportunity, that ability.

Good morning, Genius Nation! Woo. That was my tribute to Robin Williams and Good Morning, Vietnam. I loved Robin Williams. He was a great actor. I didn't think he was always funny. He was very funny, not always. Amazing actor. I liked his more serious roles a lot, as well. Recently, we just, on Netflix the other day, I was just flipping through and they said, "Hey, Dead Poet's Society." I was like, "Oh man. I'm going to put that on my list because I'm going to watch that one, man."

I remember that one. That was one of the movies that really shaped or ... It's one of my favorite movies. I don't know how well I have lived up to its message. When I saw it, I was young. I don't know how old I was. We saw it in the theater, with my parents. I didn't get the message. Only later on, did I get it. If you haven't seen the movie, I'm going to spoil it in this. I'm going to spoil it for you today. It's an awesome, awesome movie. "Gather the rosebuds while ye may." I don't remember the poet who said that, but it's an amazing line and it sums up ... That line sums up the whole movie.

Basically, in Dead Poet's Society, Robin Williams is a teacher. He goes to, I think it's a prep school. They're not in college yet, but it's a boarding school for really rich high schoolers. Either that, or it's like some small little college, a liberal arts college somewhere. He is a teacher there. I think he's an English teacher, and he takes the class, and it's all boys. The whole school, it's an all boy school. He takes the boys, and these guys are ... They look pretty rich, they look like nerds, virgins probably most of them. Nothing really adventurous about them. He takes them to this trophy case in this school and there's this picture of one of the older teams that, decades ago, where they were standing there with their little football uniforms on or something. At that time, they didn't have helmets and pads and whatnot, so they're just wearing these little leather caps on their heads and cleats. I think they had cleats.

 He's telling them to look at that picture, to really look in the eyes of the people that were in that picture. Every single one of the people in that picture is already dead. The message that those people, those dead people have, for these young kids, is to gather the rosebuds while ye may. Meaning, to carpe diem or seize the day. Don't let a day go by where it's just another boring day. Live for the moment. Live your life to the fullest, is the message. That's the whole message of the whole movie.

He shows them this in different, different ways. One of the ways that he shows them is by getting them to change their perspective. Think back to when you were in high school or college and whatnot, and you had assigned seating. You would go and you would shuffle into the room and you would go to your little desk and you would sit down. That is the image that you have of the room. That's what you see, whatever's in your vision, that's what you see around. What if you turn it around and you go and you sit at the teacher's desk? Most of us have never done that. If you go and you sit at the teacher's chair, the whole room is totally different. You can see so many different things that you didn't notice before.

One of the things that Robin Williams does, is he has them come to the teacher's desk and then he has them stand up on the desk, which they've never done before. They're all rule followers. They don't break the rules, they're all rule followers. He gets them to stand up on the desk. Standing up on furniture, with your shoes on. That's a big concept. Not only that, but you got to stand up on the teacher's desk. You could get thrown out of school for something like that. He has them standing up and looking around and seeing the new perspective, seeing how everything looks different. That's just one little tidbit exercise that he had them do.

It's a great, great, great message, great, great, great story. One of the things that I definitely, I want to see it again. I definitely want to see it again, because I haven't been living it. We do think that we are living it and we try to live it, but then day to day grind gets to you and you forget. You get tired. One of the things that is so awesome about having little kids, and this probably happens at the older ages too, but you notice it a lot more when they're little, I think, that they grow so fast. They learn so many new things so quickly. It's like every day I come home, and there's something new. We have three kids, six year old boy, five year old boy, and one and a half year old daughter. She's at the age right now where she's shooting up. I still remember the days when she couldn't even walk, where you'd have to carry her everywhere.

Now she doesn't want to be carried. Now, she runs everywhere ever since she started learning to walk, she wants to go everywhere, and she wants to go quick. She learns all these things, and she's learning to talk right now. Every day, it's a different word. It's so cool. Her mom keeps telling her, "You're so cute, I just want to eat you up. Can I eat you up? Can I eat you up?" She goes, "No, no." She shakes her head. Now she's wagging her finger. She's like, "No, no, no. You can't eat me up, you can't eat me up." It's just the cutest freaking thing.

For those of you who have little kids and those of you who have kids, I'm sure you remember this. I go home, I used to work from home. Recently, I just got an office. I used to work from home and I had my separate room there. I had my office room, and I have my library, so I got two rooms in the house that are all mine, kids aren't allowed to go in. When my older son, my two sons, when they were young, when they were born, they were in the house. We had a nanny for a while, for them. My wife was there for the first one, we had a nanny for the second one. Whenever I got bored or whenever I got tired or whenever I heard them laughing or crying or whatnot, I would always run down and pick them up and hug [inaudible 00:06:52] and feed them and put them to naps. It was such an awesome, awesome time.

For this one, I'm not there. We do have an nanny for her, and the nanny's awesome, but I'm not there every day. It was like, "Man." That was the biggest thing of why I didn't want to get an office. I wanted to get an office, it just got too loud at home and I couldn't get any work done. My hours of work were shrinking because I'm not a morning person. I don't really start my day until 10:00, 10:30. I would go upstairs at that time, start working, and then the kids would come home at like three o'clock, and then that's it. Hey, I'm going to go play with my kids, because I could do that. The style of trading I have, it doesn't take that long. For a while. For several years, it was awesome. I had that opportunity to spend with my kids, to watch them every day as they grow up, to learn what words and to teach them.

All the little things that I was teaching them and helping them with walking and talking and eating and wiping your butt and all that kind of stuff. It's just awesome. Now after the time, I just hit 40, and I don't know if I'm going through a midlife crisis or what, but I'm like "Hey you know what? I really need to get this message about there. It's great that I can trade this way, it's great that I can live this way, but if I can put in a couple hours extra more and help other people to live the same way, that would be my legacy. I think my kids are going to be my legacy so I'm not really worried about that. I don't want statues or anything for me. I think helping more people is, for me, the next stage of growth. I've had Option Genius, the website, I've had weekly training system, the website, I've had other things.

 I wasn't really paying that much attention, as I should have, to growing it. It people came into the system, if people came to our website, they had became members, I would do everything I can, or I still do, everything I could to help them out, to teach them, to help them out, to guide them. Now I think it's time to push the limit to open it up, to get more stuff out there and to help more people. For me, that's how I'm seizing the day. I'm making new goals and I'm getting out there, and I'm putting the time in.

I'm still trading obviously, I got to pay the bills, but I am able to, now that I got an office, I'm actually trading a little bit better than before, now that I have an office. I'm in front of the computer more. I'm also helping more people and I'm seizing the day in that sense. I do miss things with my daughter, but I spend time with her when I get home. I spend a good three hours with her every day at home. That makes up for it, I think. She's too little, she's not going to remember anyway.

I noticed that with my older boys, I don't remember a lot of the things that they used to do. I'm getting older or what, maybe there are just too many memories in my head now. I'm not remembering as much. We go back to the movies and I'm like, "I remember you used to say, "Ba-na-na-na-na," like that, man, that's so cute. Really, I'm now looking at the future and what my legacy is and how I'm going to help more and more people, and that's what I want to do. That's why we're getting the word out there. That's why we're doing recordings like this one. That's why we're doing videos. That's why we're doing blog post and more products and more trainings, just to help other people.

Back to my original point with the movie and carpe diem, and it also has to deal with kids. The point I wanted to make is that if you have a teenager or if you have somebody in college or if you have anybody, really, but especially if you have kids. Some pre-teens might be 11, 12, 13 years old. Teenagers, maybe college kids. If you have those, you need to sit together and you need to watch this movie, and then you need to help them, to make a plan or to keep them grounded, because life will make you forget to seize today. I would like you to give them that gift and say, "Hey, you know what? Let's do this together. What do you think about it? What are some steps you can take, maybe on a regular basis, to bring you back and to remember this message?"

One thing I always like you to do is as you are trading and as you are learning to trade, wherever you are on this trading journey, obviously you're probably listening to this because you are trading and you are investing your own capital, teach your kids how to do it. Have them do it with you. They don't have to be masters. You don't have to teach them Fibonacci if that's your thing. You don't have to teach them all that stuff. Give them the basics, show them how it works. Show them how money works. Most kids nowadays have no clue how money works. Most kids who even graduate college still have no clue. The only thing they're taught in college is how to go and be an employee.

Even if you take entrepreneurship classes, even if you take marketing classes and small business classes, one thing is they're not taught by real people who are making things happen every day, small business owners. These kids don't have that frame of reference. Nowadays, with the internet and with all the social media stuff and all this technology that's coming out with the smartphones and the apps and artificial intelligence, the sky is the limit. Kids today can literally change the world and it doesn't even cost that much money. When Facebook started, he didn't pay a lot of money to develop Facebook. He did it himself. He learned to code, Zuckerberg learned how to code, and then he made it himself and then he hired other people that also learned how to do it themselves, and they just built it that way. A lot of apps can be built by kids. They are. There's software out there that can teach you how to make an app.

There was a kid, I was watching these videos the other day. What this guy does is he talks about crypto currencies, which is like bit coin, and Ethereum. There are thousands of them. It's really hot right now, so crypto currency and bit coin is getting very, very popular. It's in the news. What this guy does is he makes a video every day, and he posts it on YouTube. That's what he does. He's went 100% into this bit coin thing, into this crypto currency thing. He spent his time researching it, learning about it, and then he makes a video every day, and he posts it online. He has I don't know how many thousands of subscribers and hundreds of thousands of people are watching his videos, on a regular basis.

The other day, he did one where he talked about how much money he made from bit coin. That was the title of the video, "How I made $100,000 in one year from bit coin." That's what his video was. I was like, "I want to hear that story." I clicked on there, I watched the video, and he was showing how he started with $500. He's a high school kid, he's still living with his parents. He had $500, and he invested in a bit coin and whatnot, but the thing is, that he did not make $100,000 from his bit coin investment.

What he did was he made money, most of his money, probably 95% of that $100,000 that he made, he made from his YouTube channel, where he's making these videos every day, and  he's posting them and then he's telling people in the video that, "Hey, you know what? There's this particular broker, bit coin broker, who's really good. You should try them out." You would have a link. If they clicked on the link and signed up, he would get a commission.

He would tell them, "Oh, there's this other company that's doing really well, you can [inaudible 00:14:42] over here." He would get a commission if people bought from his link. He would tell them about something else, and he would get a commission. He made over $90,000 last year, in one year, from commissions from a YouTube channel, without any advertising, without any knowledge, without any education. He would just go online, read the stuff, and then talk about it in his daily video, and then tell people what to do. Basically, he became like an educator. He became a teacher. This high school kid is teaching other people around the world about bit coin. How is he learning?

He's going on the computer and learning and then he's doing the same thing that the people watching the video could do. He's putting it in a video and people want to watch videos instead of going online, learning themselves. They watch his videos and they learn and they buy stuff through his links, and he makes money that way. My point is that it's incredible, the different ways that kids and people can make money nowadays, online.

That old model of going to college and paying hundreds of thousands of dollars, and getting into debt, it just doesn't work anymore. You're not going to get that big, cushy job that's going to make you 100,000 or 50,000 or 60,000. Even if you do, you have two or $300,000 worth of debt. That's why we have all these news articles every day, "Millennials don't want to buy houses because they have too much debt," "Millennials are moving back in with their parents because they have too much debt and they're not making enough money."

I had a girl who called me the other day, she's graduating from the University of Houston, and she called me. Her mother knows my wife and her mother asked, "Hey, is Allen hiring?" She said, "Maybe, give him a call. Here's the number." The girl called me up, said, "Hey, you know, I'm graduating from advertising. I got a degree, a major in advertising and a minor in marketing. I'd like to come work for you." I said, "You know what? Come on by, let's talk." The girl didn't know anything. She's done. She's out of school. She did her four years in advertising and in marketing, and she did not know the basics.

I asked her, "What have you done? What kind of marketing have you done?" She goes, "I've done SEO," which is search engine optimization. Basically, that's getting your website to the top of Google. I'm like, "That's cool. I know a little bit about that. I've done that before. How did you do it? What was your method?" She's just looking at me, like I asked her some ... Like I'm an alien or something. She didn't have an answer. She told me she did SEO, but she didn't know how to do it. She was like, "Well, we had one project in school, but I wasn't the main person on the project. I was just helping out."

I said, "Okay. Do you know anything about SEO?" "No, no, I don't know anything about it." Cool, so you didn't do anything. "What'd you do about advertising?" "I made logos and I made graphics and I've done that kind of stuff." I was like, "Okay, well that's not advertising. That's graphics. That's graphic design. What do you know about advertising? What do you know about marketing?" She didn't know anything. Her parents have paid thousands of dollars for her to go to school and now she's out, and she can't find a job.

I'm like, "You're pretty desperate for a job." She's like, "Yeah, I really need a job right now." I'm sure there are other people, like bigger companies, that come and recruit at your school, right? Job fairs and whatnot? Have you been to those? She goes, "I've been to those, I've been on interviews, but I still can't find a job." That's the state of where we are today. What I want you to do is not to put your kids into that same position.

A few years ago, we got a testimonial, or an email, which was a testimonial, and I want to read it to you. It was from one of our long term members. Let me pull it up. Basically, this is his words. He goes, "A success story from my daughter, as she has been learning from your ideas. She is currently 14 years old, a freshman of a San Francisco high school. She started to read your free lessons in August of this year. By the help of her Hong Kong uncle, with $25,000, trading in his account, she started selling SBX and Iron Condors, purely from ideas from your membership.

She has been up three months in a row, generating 12.5%, 14.57%, and 15.25%, with margin requirement of $15,000 each month, which is 60% of her 25,000. She has a profit of $6,365. She uses 25% of her profit for her pocket money, and 75% for cash reserve to pay back her uncle. She lets all trades expire as OG, option genius, designed perfect ranges, and far enough strike prices of both SPX and [inaudible 00:19:36], within six weeks of expiration. The option membership is really brilliant." [inaudible 00:19:42] San Francisco, California.

This was a few years ago and she's much older now, she's probably in high school, maybe even in college. Probably not in college, she's probably still in high school by now. No, she was 14 and she was a freshman in high school. She's probably out. She's probably in college right now. I can imagine if this girl, a 14 year old girl, can learn how to trade Iron Condors by following along with me, trading her own Iron Condors and making 12%, 14%, 15% a month, can you imagine the confidence that this girl's going to have in her life? Can you imagine what it's going to be like for her when somebody comes and offers her a job and says, "We'll pay you 30,000 a year ... Or 50,000 a year."

She's going to be like, "I don't want to do that. I can make my own income doing my own trading. I don't need to work in a cubicle." Nobody dreams to work in a cubicle. None of these kids who go to college today, they don't dream of having to work for a big ass company that's going to pay them some decent amount, but they're going to have to work their butts off for the rest of their lives. Nobody wants that. The old American dream where you work until you're 60, 62, 65, it keeps increasing. It used to be 60, where you could retire with a pension and your company would take care of you, and you would just retire, play golf, travel, that American dream is pretty much gone.

If you look at the numbers now, if you look at the statistics, most Americans have ... Over half of Americans today, over 50%, have less than $1,000 in their checking account, saved. That's their savings. It's heartbreaking. The amount of people that are retiring, baby boomers right now, that are living only on social security, that's the only income they have, it just ... It's crushing. It's soul crushing. We get emails every day from people, "I got laid off. I'm 50 years old and I got laid off and I'm trying to get a job but nobody wants to hire me at my old salary and I have all these expenses, and my kids are in college."

I'm sorry buddy, but you're probably not going to find the same job at a different place, paying you the same salary that you were making. Number one, you're 50. People would rather hire somebody out of college because they're cheaper and they can get pushed around. They can work longer hours. They have more stamina. They remember better. It's just a fact of life. We get emails like that every day. What I want is for your kids to not be in that position. For a lot of these people who email me, it's almost too late. We try to help them, but sometimes you can't. If the only income you have is your social security check, you don't have any money to trade. My thing is not for you. If I was teaching you how to get a second job or something, or get young again, you could use that and make more money. To trade, you have to have some money. You have to have some capital.

For your kids, it's a whole different story, because they have their whole lives ahead of them. Teach them to trade. You're doing it. Teach them what you do, teach them what you're learning. Learn with them. Do it as a project together. Can you imagine the freedom that your kids would have, knowing that they can go to any college that they want? Any college that they can get into? The money will not be a factor. Cost will not be a factor. When I got out of school, when I got out of high school, I got into some really, really nice schools. Ivy league schools. I could not go, because I could not afford it. The school that I went to, Florida State, and eventually I had to drop out of, I went there because they paid me to go there.

At that time, tuition, room, and board and everything was about $7,000 a year. They gave me a financial aid package of $8,000 for the year. They actually paid me $1,000 more than I needed. That's why I went there. I hated that place. Nothing wrong with it, it just didn't fit for me. It's a great school. It didn't fit for me. I applied to NYU and I got in. After my first year, I applied to NYU and I got in. At that time, NYU tuition plus room and board, everything was going to cost about $35,000 a year. Right now, it's a hell of a lot more than that. This is 1994, '95, I'm talking about. At that time, it was 35 and they gave me a financial aid package of about 16,000, which is half, about half.

I told my dad, I'm like, "Dad, dad, you can do it, right? You can pay for it? You can work harder in your business or get loans or something?" He's like, "No. Not going to happen. You can't go." I couldn't go. I don't want that to happen to my kids and I'm sure you don't want that to happen to your kid. If your kid gets into Harvard, imagine you telling him, "Hey, son, I'm sorry. Sweetie pie, my daughter, you can't get in there because I can't afford it. You're going to have to go to a local public school," which is not cheap anymore, either.

Imagine that they can go to any school that they want that they can get into, and cost is not a factor. Imagine that they can choose whatever major they want to study, whatever field of study they want to go into, without having to worry about the money. Some field that excites them. Maybe it's robotics, maybe it's teaching. Teachers don't make anything. People who go into teaching know they're going to be poor. Teachers are pretty much poor. If they really love to teach, they can go and do that because they know that they know how to trade, and that they can go into the markets and take the money when they want it.

I have had people come over our friends come over, and their daughters are ready to go to college. It's like, "So, what are you going to study in college?" That's obviously the first question you're going to ask them. Where are you going, that's the first question, what school are you going to, and then what are you going to study? The response was, "Computer engineering." I was like, "What?" I knew the girl. I was like, "I've never even seen you on a computer. You don't seem to be the engineering type. You're more social, you're more active." She was like, "Well, that's the field that has the hottest jobs right now. That's the hottest industry right now with the best jobs."

I was like, "That's how you're going to decide what to do for your life, based on what industry is hot right now?" She goes, "Yeah, because I'm going to have to take out a bunch of loans to go to school, and then I'll have to have a good paying job to be able to pay them off and have a good future. It was really disheartening. It broke my heart. Being a computer engineer, there's nothing wrong with it. Her father is a computer engineer and he loves his life. He loves his job, he loves his life, but I don't know if that's right for her. It didn't seem like she was too excited about it. I tried to talk her out of it, but at that point, it was too late because that was their situation. That was their thing. Your kids don't have to be in that situation. My kids are too small. They're five, six, and one. I can't teach them right now, but I want to. Eventually, when they're older, I will. I want them to have that freedom to do whatever they want.

Imagine giving the gift to your kids of them being able to follow their calling, whatever it is, whatever their calling is. Maybe they want to be a social worker, maybe they want to be a missionary, maybe they want to be a world traveler. Right now, if they go get a marketing degree or an accounting degree or whatnot, they can't do it. They don't have that freedom. Imagine them having the ability to follow their heart and their freedom, not worrying about money because they know how to go into the markets and just take it out at will. That's what option trading, the way we do it, gives you that opportunity, that ability.

Our trades are done month by month by month. You can if you want, but you can have really, really long one one year, two year trades if you want, but most of our trades are short time frames. You can trade for like three months and then stop, take that money out, and go on a trip. Come back, start trading again. Take that money out, go on another trip or go do something else. You can trade in your spare time. Literally, it doesn't take me more than 20, 30 minutes a day to do my trades and I make a very good income from it. A very good living from it. Imagine that. Imagine your kids had that ability. Wouldn't that be awesome? Could you give them a better gift?

Of course, you can give them a few other things like teach them how to be a good person and how to live properly and respect of other people and how to love yourself and love your spouse and all that, love your kids. The gift of financial freedom? Imagine if you started them on that journey today. Even if you don't teach them about how to trade right now, or trade options, at least get them investing. Open a brokerage account for them, put some money in there. Buy an index fund if you have to. Don't buy an index fund, buy an index ETF, like SPY or IWM. Get them involved.

One thing I did with a friend of ours, she passed away now, but she was like my sister. I'm an only child, but she basically ... We became friends, she became my wife's best friend and I was friends with her husband. The kids were like ours, we would treat them like our own kids. She started calling me her brother, her older brother. She had always wanted an older brother. She started treating me like an older brother. She became my little sister. For her daughter, I think she was 10 or 11 years old at the time, I wanted her to get involved in trading and investing, and I wanted to teach her how the world works, how money works, that you don't have to work for money. You want to get your money to work for you. That was the whole lesson behind it.

I opened up an account for her at Fidelity, and it was a minor account with her mom being in charge of it. Every year on her birthday, she would buy stock. I would tell her, "Pick a company and I'm going to buy you $100 worth of its stock." One year, the first year, this girl was ... She was a normal teenager, but she was a little bit materialistic in things like makeup and clothes and shoes and whatnot. She knew about Ulta. She was like, "I really like Ulta. Does Ulta have a share?" I'm like, "I don't even know." I didn't know about Ulta at the time. We looked it up and yes, Ulta did. Ulta had a shares trading. We bought, I don't know how much it was, but we bought some shares of Ulta.

Since then, that stock has gone up like two, 300%. Every year, she would buy one company. I put in maybe ... We did it for four or five years. I probably put in about 500 bucks. Right now, she just went to college, she just left for college. There is over $2,000 in that account. She was an amazing stock picker for not even knowing what a stock was. That's one way of teaching them. If you don't want to teach them options trading, get them invested in stocks and start with a little bit instead of giving them a big birthday gift or something, that's their birthday present. You can even do that for all types of events, for weddings. Have a smaller wedding, and put that money away for your future. Crazy concept, it might work for some people.

Now that I think about it, I think I've changed my mind. My kids aren't too little. They're five, six, and one. Maybe not the one year old, but the five and the six year old. My six year old already beats me at Chess. I think he could understand how the stock market works. I think it's time to start trading with them, teach them the basics. They won't understand what a [inaudible 00:32:18] is, but teach them the basics. I think they'll get the hang of it. I think they'll be interested. I think they're already interested in what daddy does. They don't know what daddy does, but they're interested. They ask me questions and stuff. I think it's time to bring them on board and to learn. I can't imagine how awesome that would be for them. Crazy.

Folks, that was my message for today. Carpe diem. Teach your kids to trade as you would learn yourself, as you get better. They might even be better traders than you are, which would be awesome, right? Give them that gift. Remember to always trade with the odds in your favor.

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Nov 05 2017

33mins

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Rank #9: Trading For A Living Without Trading - 52

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

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Allen: Welcome, passive traders, to another episode of The Option Genius Podcast. Today, I want to be talking about trading for a living without trading. Huh? What? Allen, what are you talking about? How do you do trading without trading, but to doing it for a living? That doesn't make any sense. Alan, what you talking about? Well, allow me to explain.

Now, you see trading for a living sounds great. Whether you do it professionally and you manage other people's money and you get a percentage of the profits or whatever, or you trade for your own. You trade your own money and you grow it, grow it, grow it over time, and then you have enough money to earn a decent income from it so that you don't have to work. You don't have to do anything else. You're covering your expenses. We have people doing it both ways, and it just sounds interesting and exciting.

It's like I trade for a living and it gives you a boost to your confidence as well, I got to tell you that. If you feel bad about yourself, but you're like, yeah, I trade for living. Oh, man. You're on top of the world. That's why they call themselves, these hedge fund guys, they call themselves masters of the universe. Because he is a key man. You got your chest stuck out like, I trade for a living! It's like if you're at a party, people come up to you and say, hey, how are you doing? What do you do? And you're like, I, trade for a living! I go into the markets and I bend them to my will to do my bidding, with just my wits and my brains. I make money from thin air. Ha, ha, ha, ha.

Well, I mean, you probably don't want to do it with the evil laugh at the end. But I mean that's the way most people look at it. Unfortunately, most people have, even traders, have a misconception about trading for a living because they normally think of day traders who by definition have to trade for a living because that's their job. That's what they do. If they don't trade, they don't eat. If they have a trade on, they have to go to the bathroom, they can't. They have to wait until the trade is over. They can either pee their pants or if they leave, then they might lose money on the trades and they can't do that. But most professional traders are not like that. They let their assets or their money work for them. They let the markets come to them and they only trade when they feel they have an advantage.

This advantage, it doesn't come every day or multiple times a day. I mean, you take for example, Jesse Livermore. Now he's not famous anymore, but back in the day in the 1920s and '30's, this guy was the major trader. Everybody knew his name. He made millions back then and this is in 1920 dollars. He actually wrote a book about it called Reminiscences. I don't even know how to say this word. Reminiscences of a Stock Operator. He used a pseudonym as the author of that book, but there's another book specifically about him called Jesse Livermore, World's Greatest Stock Trader.

Now I would urge you, if you're interested in stocks and trading and whatnot, even options, you should get both of these books. I love them. I read them from time to time. He's one of my favorite classic traders and you can actually learn a lot from the way he thought by reading his books and understanding what he was going through when he was thinking about trades, when he was ... when things were happening in the markets, how he would react to them. How we would see them.

He was probably one of the first people who ever used technical analysis before they even knew what that was. At that time back then, they didn't even know or they didn't have any understanding that markets would move in certain patterns. And so, he was in his brain without even doing the charting in his brains, he was able to discover these patterns. But, he did not trade every day. He wasn't in the market all the time.

His keys to success, one of them at least was to wait. One of his most famous quotes is that the money is made in the waiting. He was called the boy plunger. So what he would do is he would wait. He had his whole big stock portfolio just sitting there waiting. Not in the markets every day. He didn't care what happened every day. But then, he would notice something happening in the market. He would notice that there is something abnormal happening and then when that happened, he would go all in. Now I'm not saying we need to do this. Eventually he did end up going bankrupt. Actually he went bankrupt several times, but the last time he couldn't recover. I don't remember if he actually killed himself or not. I don't remember that part, but he ended up, he never recovered the last time. But, he was able to make millions along the way If he had put it into other investments, he probably would've been okay, but he didn't, so there's also that lesson to be learned.

But then we have, what he was waiting for, the proper opportunity. He was waiting for the chance where the odds were in his favor. Now he wasn't selling options. I don't even think they had options back then, so he didn't have the opportunity that we have as option sellers and passive traders to wait and to do trades that have the odds in our favor from the beginning. But his thing was, he was a stock trader and so he would wait until the market showed him or a particular stock showed him that he was going to make a big move in one direction or the other. That's when he would go all in for it.

Now, I bring this up today because right now it's August, 2019. When I'm recording this, it's today's the seventh. The markets this month have started off very rough. We're down about 7% on the S&P 500 as I record this. Now, I don't know what's going to happen later on, and it doesn't really matter if you're listening to this much later. You could be listening to this to a year or two years from now. It doesn't really matter. But the fact is that this is going to happen. There are going to be times in the markets where we have big declines or we have big upswings, but mostly the declines happen really, really fast. The bull goes up the stairs, the bear goes out the window. The bear's going to go down a lot faster than the bull makes it up to the top. But in that event, what do you do? Should you be trading in such a market when in one week the market is down 7%, it's down 3%, then it's up 2% then it's down 5% or 4%.

Well, if you can make money in a volatile market or you're a pro short seller, then yes, go ahead and trade. That's your element. That's your thing. You go and you do it. But if you're a at home gamer option seller, then probably not. I had this argument with one of my students in our Blank Check Coaching Program in which we sell oil options. That's the whole program there. We sell oil options. He was upset because he was trading for a living. Doing well at it for several months, over a couple of years. But he was upset when the oil market was not cooperating.

Now I tried to explain to him, I said, look man, you don't always need to be in the market. Every month the market is not going to cooperate. It doesn't matter how good your strategy is, how good your trading plan is, how good of a trader you are. There are times when you will lose money and there's nothing you could do about it. But the reason that we sell options, we know that over time we are going to continue to win. It's a longterm game. Not just over one month or two months but over 12, 24, 36 months, we know that we're going to come out ahead. So yes, this month, August, 2019 might be a volatile month. It might be a down month and you might have lost a little bit of money. But if you're an option seller, we have the opportunity to get back in right next month and do it again and make money and then make money and make money and we'll go recover our losses. Over the long term we come out ahead.

But if you are trading for a living, sometimes you don't have that ability to look at the long term because you've got to pay the mortgage this month. And like the student, he expected to take his expense money out of the market every single month. That's just not realistic. Now you might be sold something otherwise, you might be told oh hey, you could be a day trader or take this course or take this course and we'll teach you how to make money every single time. All your expenses will be paid from the market. No, that's not realistic. I'll tell you the truth, right now the markets are down.

I currently only have one trade on in my trading account. I mean, in my retirement accounts, I still have my covered calls and I have some naked puts on that I sold to take advantage of the situation of this downturn. But in my trading account, I have one trade and it's a small trade. That one trade is not going to pay my bills this month, but that's okay because I knew that this type of event can happen. I built in a safeguard and I have a cushion. I know times like this will come when I don't want to be trading.

You look at any hedge fund, they are not fully invested all the time. Heck, they're almost never fully invested. Meaning they don't always have 100% of their money at risk in the market invested in something. They don't have to make a killing every single month to survive. They play the long game. It's about a yearly return for them. Even though we sell options and we trade and we talk about trading for a living and our expenses come every month, that doesn't mean that we have to look at our trading on a month by month basis. I mean, of course we do because we want to see how we're doing. But if you look at it on a yearly basis, you'll get a much better picture and a much better idea. If you look at long term 12, 24, 36 months, that's how your account grows.

So when people asked me, Allen, how much of my money should I put into this trade or into this strategy? Or how much money do I need to make X every month? I'm not sure what to tell them. It's surprisingly how often I get that question. Alan, I need to make $2,000 a month. How much money do I need? I can't tell you. I mean, we did an episode on that to help you figure out what number. I don't know what it podcast episode it was, but if you go on the list, that's the title of it. How Much Do I Need to Make X? You can listen to that one. I go into that more detail, but every month is different and every person is different.

I don't know. I can't give you a number and say, if you want to make $5,000 a month, well you need to have an account with, oh, let's say $50 thousand dollars and you'll make 10% every month. I can't say that because there might be some months when you do, but they're going to be other months when you don't. That would be a lie. There's too many variables. You need to have your trading money and if you trade for a living, you need to have savings, a cushion that you can tap into when you are not trading or the markets are not cooperating, which they do from time to time. The worst thing to do in this situation is to force a trade.

Because if you feel like, oh man, I have to do something. I have to do this. I have to do something. I have to take advantage of the situation. Oh the market's dropped 7% I don't think it's going to go up anymore. I think I'm going to go short the market right now. Well, when the market drops two, 3% in a day or more, it can turn around the next day and jump up the same amount or even more. If you force a trade, you stand the chance of getting your face ripped off and that's going to double the compound.

I mean, maybe you already lost money because the market went down unexpected. Okay, fine. You lost money. Well, now you're going to double down and say, all right, now I'm going to short the market and the thing's going to rally because that's what markets do. Then you're gonna lose on both sides and then you're going to be even more upset. Then you're definitely going to be on tilt, which means you're not going to be emotionally stable. You're going to be looking at all different kinds of trades and you're always like, aw man, I got to pay the bills this month. I've got to pay the mortgage. Oh my God, what do I do? What do I do?

That's not the way to trade. That's not the mental status you need to be trading. That's not the way, the time, the mental frame that you need to be in to trade effectively, to trade properly. It doesn't matter what strategy you're using. So yeah, if you want to trade for a living, you need to know when not to trade and that you don't always have to be trading. That's the whole point of this episode. Don't force trades. Don't always be trading.

Like that student I mentioned, if you have to always be trading to earn an income, then that tells me that you don't have enough funds to be trading in the first place for a living. You should go up and save more. That's the bottom line. So while the pundits on the financial media are freaking out right now and nobody knows when the markets are going to stop falling. I am just going to sit on the sideline and wait. I'm going to wait for the VIX to calm down. I'm going to wait for markets to calm down before I dip my toes back in the water. I mean, I had my trades on and this month I'm going to lose money. I already know that.

Well not necessarily, the month is still young. But I had my trades on, and the markets turned around and I got out. I took losses and I got out of every single trade except this one. I'm like okay. My losses that I took are manageable. I didn't wait and think, oh, things are going to turn around, things are going to turn on. No, I saw a change in the market and I said I'm getting out. We did that. We did that on all of our services Option Genius, Simon Says, every trade we're out. Now, when the market calms down, we're going to get back in. Then the trades that we put on, hopefully will recover what we lost and hopefully more. Or if not this month, then in the next two, three months we'll recover everything that we got back. That's how you play the long game.

Because yeah, you'll lose a little bit of money in a month or two, but you add up all the wins from all the good months and that recovers and it gives you a good yearly yield. So when you look at the longterm picture, 12, 24, 36 you come out ahead. That's what I mean by you come out ahead that way.

So again, trading for a living without trading means that if you are having to be forced to trade, if you have to be in the market all the time, there's a very good chance that you're going to lose all your money and that you're not going to be able to trade. Just like Jesse Livermore, he sat around waiting for the perfect opportunity for him. For us, we have good opportunities every month, but that doesn't mean we need to be trading. Doesn't mean we need to be in the markets. If we don't understand what's going on in the market. If the market is too volatile for our taste. If our strategy calls for a slow market and we don't have that, we wait. We only trade when the odds are in our favor. That's what it comes down to.

Thank you so much for joining me on another episode. See you next time.

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
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Aug 12 2019

16mins

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Rank #10: Why Options Were Really Created - 008

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Welcome Genius Nation. Welcome to another edition of The Option Genius Podcast. So glad to have you here. You know, I gotta tell you. Today I'm going to be talking about something that is near and dear to my heart, because, well, I love options. If you can't tell. The guy behind OptionGenius.com, having traded options for years and years now, and really getting out there, and evangelizing options, and telling people, "Hey, you know what? You need to be trading options." I do it because, they have literally changed my life for the better, and I really feel that they are great for all types of investors.

If you're going into retirement, if you're going to try to create your financial future, and be financially free, and talk about the different types of freedoms that we really aim for at Option Genius, they are ... If you're going after those with a gun, right? Well then options are a bullet in your gun.

The problem is, that most people out there are being told myths about options. They're being told, or they're getting erroneous information. Most people lose money with options, and most people are afraid of options because they're told, "Hey, those things are risky. You better stay away from them. People lose money on those." Why? Why is that out there? It's because there's so much false information.

Well, maybe not false exactly to say, but it's been told by people who don't really know the whole story. I mean, you could read any kind of article in most of these magazines that talk about finance, you know? There's so many of them out there now. But, when they talk about alternative investments, or they talk about ways to make passive income option selling, selling options, selling premium, none of that is ever discussed. Because, it's taboo in a sense, or it's too complicated, or too advanced, you know? It's a shame that people, common, every day normal people are not told this stuff.

http://simonsaysoptions.com/stocks

http://www.weeklytradingsystem.com

http://www.optiongenius.com

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
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Nov 21 2017

25mins

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Rank #11: Trading In A Corporation With Brian Canter - 37

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Should you trade in your own name or a Corporation?

How do you protect your assets? Do you even need to?

In this episode, I talk to individual investor Brian Canter who explains why he trades inside a Corporation, how he set it up, the benefits, and pitfalls.

This is an episode every serious trader needs to listen to.

Resources:

Moore Research Center - mrci.com Momentum Structural Analysis -olivermsa.com Anderson Business Advisors - andersonadvisors.com

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
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Jan 15 2019

37mins

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Rank #12: What is Passive Trading? - 50

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

To celebrate episode 50 I thought I would do something special. As you may know, I am writing a book to introduce the masses to the art of Passive Trading. And while the book is still being finished, I thought I would give you a sneak peek.

So here is Chapter 1 of the book. But keep in mind this is in rough draft form. It still has to be edited.

I am sharing it because, well, I am too excited not to.

This episode answers the question, "What Is Passive Trading?".

Can't wait for the book? Check out our Passive Trading Formula Free Webinar! (click here)

-- 

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
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Jul 07 2019

53mins

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Rank #13: Trading Triggers - 68

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

This is a short little episode that can make you a ton of money if you do the work. What I'm talking about I call trading triggers. A trigger is, something happens which results in something else. Basically cause and effect. Right? For example, if I lay down in my bed, I will fall asleep. Cause and effect. If I eat McDonald's every day, I will get fat. Right? Cause and effect. It's pretty normal. It doesn't necessarily mean it's going to happen every time, but it happens most of the time. There are lots of things in economics that are cause and effect related, such as supply and demand. Right? If there's too much supply, prices will go down. Too much demand, prices will go up. That's cause and effect. Trading triggers are events that happen in real life that we can capitalize from, because these events happen over and over again, and the reaction of the markets is usually the same.

For example, I'll give you a trigger that I have noticed works almost every time. That is, whenever there is a hurricane, and of course hurricanes happen often, not every day, but they do happen often, the price of wood or lumber will go up. Because if there's a hurricane and there's destruction, they're going to need a lot more lumber than anticipated, so that's going to increase the demand, and the supply stays the same, so that's going to raise the prices of lumber. So many times in the past when I have seen a hurricane that is going to be doing some damage, I've gone into the futures markets and bought either lumber or lumber options, call options, betting that the price of lumber will go up. Hasn't always happened. Maybe there wasn't enough destruction, or it was already anticipated and priced in, but many times I have made a pretty penny.

Now, I can't make a living trading this one particular trigger because there aren't that many hurricanes. Thank God there's not that many, destruction in the world. But there are many other triggers that happen over and over again that we can do some research on, identify, and then figure out what is the likeliest situation that's going to happen based on what's happened in the past. Right? Some triggers could be, what happens when the Fed lowers interest rates? That's happened many times in the past. There's a history there. We can do the research and figure out what happens. What stocks do best? What stocks get hurt? How can we make money off of this particular trigger? What happens in a bear market? Right? We don't get them that often, but when we do people know, bear market, it's a good time to buy. That's a great trigger right there.

Stocks are down. Buy more shares. Now, that's the opposite of what most people do. Most people are selling into a bear market because they're afraid. But any guru will tell you that you should be buying when there's fear in the streets, right, or blood in the streets. Fear in their eyes, or whatever. I don't know. Whatever the saying is. But when people are scared, that's when you should be buying, because that's when it's cheap. What are the other triggers that you can identify, and maybe there are triggers that you know that nobody else knows. It might be related to your industry. It might be something that you have noticed, or you have experienced in the past. Identify some of these triggers. Do the research. What happens most of the time when this trigger occurs, and figure out a way, based on what happens, figure out a way. How do you make money off of that?

I've shared mine with you about the lumber. Feel free to use that, and if you identify some, I would love it if you would share them with me. Right? If you notice something ... This is one of the reasons why I say that you need to have a watch list and you need to focus on the companies on your watch list, and trade, the majority of your trades should be on the companies in your watch list because you're going to develop a sixth sense, and you're going to start seeing triggers based on that company. If they have, for example, earnings announcement and they don't do so well, you're going to know how the stock is supposed to behave because that happens every quarter. Right? You'll see that happening. You'll know how the stock is supposed to behave.

If it doesn't behave the way it's supposed to, then maybe the trigger's broken, and you need to get out of that stock, or the stock is broken. That's one of the reasons why I tell you, make sure you have a watch list. It's very important. Please do not be out there trading every single stock in the universe. Okay? But what are the other triggers out there? Find them. Identify them. See what happens. See what the result is, what the effect is when that trigger happens. Some other examples of triggers could be ... We already talked about natural disasters. We already talked about bear markets. We already talked about the Federal Reserve and interest rates. It could be related to seasonality. Some people say there is seasonality in the stock market, so seasonality with oil. Every year in the summertime people are driving more, so gas prices go up.

That's one type of trading trigger that you could be trading. That's a very common one that people know about. But that's an example of what you could take advantage of. So if you're in the oil markets, you probably know this, know more details about it than the average person. If you're in the furniture business, maybe you know some trading triggers that are related to furniture that nobody else knows. Maybe you are in the medical business, and you see an uptick in, or you've noticed that there is a shortage of cotton swabs. I don't know what that could mean. I'm not in the medical field, but if that happens, maybe you could do a little research and say, "Okay. Why is that happening? What's the effect?" Maybe that means that people are getting sick. Maybe the shortage of cotton swabs is the effect and the cause is that more people are getting sick, or there is a particular disease that they're getting sick with.

Kind of like the COVID-19, the coronavirus. Right? A lot of people getting coronaviruses. What's going to happen? Well, we're going to need more face masks. We're going to need more ventilators. Okay, so who's the company that makes the ventilators? Let's buy their stock. 3M is the company that makes the face masks. Let's buy their stock. Right? Procter & Gamble makes Charmin toilet paper. Let's buy their stock. Coronavirus definitely was a trigger. Based on that, it impacted the economy in several different ways. We've all lived through that. We've all seen it happen. Heaven forbid there is another virus, there is another outbreak of corona, or a different type of corona. You can be ready to capitalize on this. Now, please don't send me hate mail telling me that I'm profiting off of other people's illnesses, and disasters, and all this stuff. These things are going to happen anyway.

I'm not praying for them to happen. I don't want them to happen. But if they are happening, as investors and traders, our job is to make money from what happens in the world, good or bad. That's what I'm trying to educate you on. So identify as many of these trading triggers as you can. Have them on a list. Make a list. Keep it by your desk. Whenever you see one trigger going off, what's going to happen? What and how do we profit from it? If you identify some, please, please, please share them with me. My email is help@optiongenius.com. I would love it. I'm trying to put together a massive list. I might even come up with a product or something like that where we'll share them with people. But for now, I'm just trying to come up with some for my own, and if you could share yours, that would be wonderful. All right? So find your triggers, start making some money. Remember, trade with the odds in your favor.

https://optiongenius.com

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
  3. WATCH THIS FREE TRAINING: https://passivetrading.com
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Like our show? Please leave us a review here - even one sentence helps.

Apr 23 2020

5mins

Play

Rank #14: From Struggling Trader To Making A Killing With Dan Hayden - 49

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

How do you go from being a struggling trader to making a killing with options? That's what I'm talking to Dan Hayden about.

You see, Dan Hayden is one of our students in our new course that we have released, it's called the Passive Trading Formula. He's been in the course for a few months, and he wrote to me, and was very enthusiastic and was very happy with his results. When I read them, I really could not believe my eyes. I was shocked and I was like, "Man, I got to interview this guy. I got to figure out exactly what he did, how he did it, and I have to share that information with you guys."

This episode is an interview with Dan Hayden and how he is learning. He was already an experienced trader. He knew a lot of strategies and everything, but it was just something in the course that helped him to take it to the next level. Then we're going to help him take it even more to the next level.

 If you are struggling, even if you've known a lot of strategies, even if you've done courses or whatever, but there is something still missing, I think this episode is something for you to listen to. Hopefully you'll get something out of it. Let's go ahead, let's cue the music and get with it.

For more info on the program mentioned in this episode check out our Passive Trading Training HERE.

Dan, why don't we get started and let me know a little bit about you. Who is Dan? Why do you trade options?

Dan Hayden:      Yeah, so my name is Dan. I'm in Upstate New York. I started trading options a long, long time ago just because I wanted to earn along with the normal earnings of the stock market and I wanted to complement my trading.

Way back when, I don't know how, I think it was from my family, my grandfather, I was drawn to the stock market because it seemed like that's one of the ways in order to build wealth. Not to say that I had a lot of wealth, but it's another tool in your bag to complement your normal investing that you're doing with normal stocks.

Allen Sama:        Do you work full-time?

Dan Hayden:      That's when you and I got in touch with each other, because I was actually laid off. I had a awesome job, I was laid off, and I was at the point where I had to decide, "Shoot, do I just retire now? Do I go back into the workforce?" I had an awesome job and loved what I did, but I did travel a lot and it took a lot out of me. Therefore, it hampered my ability to just trade options because I was so busy.

When I contacted you, you had a promotion going for your new program. Right now, I am consulting. I do some work on the side and I am trying to, with your services, and system, and help, and as well as people on your site trying to get back into it, trade, develop a strategy so that I can comfortably earn a couple of thousand dollars each month is my goal.

Allen Sama:        Yeah, I mean your story is very similar to a lot of the stories that we hear. People have been working really good jobs, they're making a decent amount of money, their family gets accustomed to a certain lifestyle. Then because of the economy, or the company, or something happens, and that job and that income is not there anymore, then the question is, "What do I do now?. [inaudible 00:04:01] go back into the workforce?" If I do, a lot of times it's hard to make the same income as you were making before in the same job.

Dan Hayden:      That's exactly right.

Allen Sama:        That supplement income has to come in [inaudible 00:04:14]. Then a lot of people come and say, "Okay, I have money that I have saved up over the years. How do I make the most of it?" I'm really excited that you're taking action.

Dan Hayden:      As we spoke, you and your program has given me the confidence to realize that. All of these services, and I get way too many in my emails, and they're provocative, they stimulate your interest and you're like, "Oh, wow. Maybe I should join this. Maybe I should do this."

 It was great because as I jumped in, it made me realize that I am blocking all of these other emails that come to my inbox, and I don't want to be clouded by they have the best new widget, and they have the best this and the best that. Because you've shown to me, and I have questioned you that these other places are making something very, very easy complicated. Your scanning, your reviewing of the three moving averages, and showing the trend makes it very, very simple to select the trades that are applicable.

Allen Sama:        There are people who are traders and then there are people who are expert marketers. Sometimes I envy them, some of the other companies. They're like, "Man they make hundreds of millions of dollars a year selling their services. I wish I could do that."

Dan Hayden:      Yeah. It's all what you want too. If you're a really good trader ... I always said, if you're a really good and you have something that's really, really a great program, why do you have to charge people right away? Let them get into it and then bill them. If you're so good at trading, why would you even offer this because you can just stay at home, do your trading and make your money there. Why do you have to offer these services?

 That's where the suspicion comes in. I just had one in about a year, a year and a half go subscribe to them. That's when the market turned. I realized that they're not doing anything different than I was doing in selecting the verticals to trade. Their losses were like my losses on my own. It's like, "I can I lose my money on my own without having to plunk down $750 or $1,000, or whatever."

When you and I, when I applied to your program, it was perfect timing because I was down. I was hitting the chops because you never expect you to be laid off. Never in my life had I been laid off before. I'm like, "I had invested and been wise with my money all my life." I was at the point where I could say, "Well maybe I can just stay home and enjoy my family, and relax a little bit and start getting back into trading options."

 It was perfect timing because you lifted me up and got me back into trading. It's been fun. You have a very practical approach to selecting stocks to trade on. I also like your methodology of thinking. It's almost like a cycle. You could sell puts on really good stocks that you want to own and collect dividends, because I have another fund that I do that with. You own those stock and then you can trade covered calls on those. You can bring in, if you are executed and you do now own Verizon with a 5% or whatever it is dividend, and then you start selling covered calls on those so you have more income coming in. Then you're also doing your vertical spreads so you have additional income coming in.

Technically there's three ways to create an income stream and it just made a lot of sense to me.

Allen Sama:        For our listeners, I just want to let you know that Dan is part of our Passive Trading Formula program, our course. That's what he keeps mentioning, the program. That's the one that he's in.

Basically the idea behind that is I got to a point where in my own trading, where I didn't want to spend os much time watching the markets and watching my trades. You can do that in the beginning if you're just starting out with a little bit of money, you have to be a little bit more aggressive, so you have to take more risks. But eventually you get to the point where you're a little bit older or you [inaudible 00:08:47] a little bit more money, and you say, "I just want to do this in a passive way."

The myth is that if you're not as actively engaged, you won't make as much money. Dan has proven that, what would you say, Dan? In the first four months of 2019 or the first five months, your paper trading account was up about 90,000?

Dan Hayden:      Yeah, but I do have to take a little bit of that back because some of that I was called out on and it impacted my results. But I think overall it was $45,000. Clearly ...

Allen Sama:        In about five months?

Dan Hayden:      Correct. Yes.

Allen Sama:        On what type of account? Which size?

Dan Hayden:      I did a paper trade account and I automatically, I think I put in $250,000 into it.

Allen Sama:        All right, that's a really sweet gain. How long do you think you spend every day on your trades?

Dan Hayden:      It's actually changed because from the beginning of the year, I think we got started in January, I had all the time in the world. Then I just got called for a contracting position, so I am working as a consultant with a company right now. I've pulled out a little bit more. I traded a lot for January, February, March, April. May has been a little bit less. I just have to figure out what my time scan is going to be so that I have the appropriate amount of time to be trading.

Allen Sama:        Do you think that the trades that we're doing require a lot of time for you?

Dan Hayden:      No. I think in and this is something that I want to learn more of and I asked on our call last week is that I want to be able to set automatic stops, which I know you're not a big of, but I want to get into a method of basically setting stops right when I set up the trade so that if I do have to fly somewhere, I don't have to be with a computer.

 Time wise, not at all. I started with my watchlist, you'll see two watchlists on the left, I started with mine and then I put yours in as well. I like yours better. Now I'm also just scanning through companies that I know there's no premium to paid on them. I don't even go to them, I just go to the next one. It almost seems like I'm trading the same stocks over and over again. [inaudible 00:11:32] less and less time.

Allen Sama:        Yeah, that happens. You develop some favorites and you like the way they're acting, you like the news that's coming out. Some of them might be on your list. You might trade them over and over again for two, three years. Eventually stuff will change, the stock will change, it'll change is behavior. Maybe a new competitor will pop up, or new CEO or whatever. Then it'll drop from your list. You're be like, "I don't want to trade that one any more. It's not acting the same way."

That's why we focus on that watchlist and say, "These are the same companies I want to watch every month." Then you get a second feel, like a sixth sense that it's not acting properly. Let's not trade it this month. Let's just relax and watch it, and then we'll maybe look at it again next month.

Dan Hayden:      Absolutely. I hope more and more people start getting active in your site with interactions because I've learned of companies that I've never even heard of before that have very good premiums. It's been interesting picking up a stock here or a stock there that you can start to track as well.

Allen Sama:        That's why one of the reasons we have everybody put the homework inside the group itself, because that helps other people. Anytime somebody puts in a homework assignment and says, "Okay, these are the trades I've found that I really like." Other people could look at those and be like, "Whoa, that's a really good trade. I think I'm going to do that one."

Dan Hayden:      Exactly. [inaudible 00:13:03].

Allen Sama:        There was a couple that I found from somebody that put them in and I'm like, "Oh, wow. I didn't even know this one particular stock was paying that much right now." I was like, "Wow."

Dan Hayden:      Exactly. Some with very rich premiums. That's what we're all looking for.

I like it when people, when they communicate. I think people shouldn't be ashamed or nervous about asking questions because everybody is starting out at different levels so that when experienced people can support the young people, or the new people just starting out, it makes for great interaction and a great learning experience in your group.

Allen Sama:        What strategies have you decided to focus on?

Dan Hayden:      I have been doing some naked puts, some selling. Then I started with covered calls only because I have a couple of stocks that I have a lot of shares in and I said, "Okay, I want to build up some income," but I haven't focused on that too much. Most of it has been vertical spreads and selling puts.

 If you're on right now, I guess I'm a simple guy, I got to make it really easy for myself. What I'll show everybody is basically I'll go through here on the left-hand side, and I'll start with my watchlist and the charts. You'll see here that I have the three simple moving averages, the 20, 50 and 200. You can see that I ... You want to go with the market. If the market's up ...

Allen Sama:        On the screen you're showing your Thinkorswim paper trading account, right?

Dan Hayden:      Correct. Yes.

Allen Sama:        Yeah, okay.

Dan Hayden:      Like I said, I think I started with 250 and right now net liquidating would be 484. Clearly it's been pretty nice. I wish this was really money, but this has been really fun.

As you've told me is to develop the confidence to basically start cash trading at the right time, because you did, you were very pointed to me, how long did it take me to learn my trade? Because I wanted to go right in, "Okay, hey. I've been pretty successful. Can I go right into cash now?" You said, "Give it some time, get more comfortable." It's true. Hey listen, we're going to lose some money, but if we win more than we lose, we're going to be way better off.

I'll just scroll through and see which ones are either above the 20, 50 and 200, or below the 20, 50, 200. For example, ADM I'll say no because it's right in the middle and it's just not one to be traded. AGN looks like it's down, so that's something where you could actually do a call. This is Allergan and I think Allergan pays a good premium. What I do is I come right over to ...

For people who are watching this, what I'll do is I set up basically almost three screens going at once. You can do this, and I know Allen, you did this on one of your calls, but you can do this by detaching this layout right there. I detached two layouts. All this is to do is just to make it simple and quick, so that I can scroll through, select ones. Then you see down here on the bottom left and if I'm scrolling all over the place, I apologize, but I have on my scratch pad basically the numbers that I want for my verticals in order to know that I'm at the 10% level. Right away, as easy as it sounds I always like, "Okay, I got to look. Is this 10%? Is this 10%?"

As Allergen showed, it's down. I would look and say, "Okay, let me look at some calls." I'd go to a delta of typically we're working around the 10%, so I looked between seven and 14. Maybe got to the 14, which is 140. I go over to this page and look at the 140, it's /135. Okay and it says it's not available. I don't know why it wouldn't be, but maybe it's just uploading. Not available.

Let's go to the next one. I would scroll down all of these. This one looks good too because it's above the three moving averages. However, it looks like it's dipping down a little bit for AIG. Got Applied Materials.

 This is how I would scroll, as you've educated me in looking for those that are either above or the below moving averages. Altria is a good one. I'm trying to think of some of the goods ones that I like. I can go here. Broadcom, AVGO, that's one that I have traded almost every month and is a pretty good one, so let's go to it.

Allen Sama:        In terms of the credit spreads or the layup spreads, do you follow the rules as laid out in the course or have you modified them?

Dan Hayden:      No, I pretty much follow your rules. I probably have gotten a little sloppy this month because for example, I was gone this week traveling and I wasn't on top of it as much as possible. I'll travel with my iPad and leave my computer at home, and my computer basically is the best one. iPads I have trouble basically executing the trade with Thinkorswim.

Allen Sama:        Oh, it's not the same thing? I know I do it on my phone, so I use their app on my phone. I've never done it on an iPad before.

Dan Hayden:      Yeah. I can't get used to the phone app either, but either one, I'm more comfortable with the MacBook. I'm just going to bring up Broadcom to see where we are at right now. Right now it's right in the middle of these three, so I would stay away from a trade right now.

Allen Sama:        About how many trades do you put on at a time?

Dan Hayden:      It all depends. It all depends on what's telling me to trade. Right now I have, there's a put. The puts are on Altria and AT&T, two high dividend players. If I own them, I'm good. If just take the premium in, I'm good and then I'll do it again next month. But right now I have NVDIA, Intuitive Surgical, Campbell, Arcadia, Pacific and Broadcom.

 You can see here, profit and loss. These are things about setting up automatic sells when they hit a certain point.

Allen Sama:        Let's say you got about one, two, three, four, five, six, seven, eight, nine. Nine trades on.

Dan Hayden:      Yup. One, two, three, four, nine.

Allen Sama:        In addition to your covered calls.

Dan Hayden:      Covered calls, I've stopped doing those. I used to do the covered calls on these stocks right here, but I was ... The covered calls to me, I'll get into those later. With Alexion, I have 1,000 shares of that. That's the one I really wanted to stay focused in on. But I've put that on the side burner. I'm just doing the puts in the vertical spreads.

Allen Sama:        The thing is, with the different strategies, you can take and see what the market is giving you, and you can manipulate. If you're in a bull market, naked puts, they do awesome, put spreads do awesome. Covered calls, if you're not in the stock, if you don't own the stock and you just want to get out every time, then they work really well. In a sideways market, I love covered calls.

Dan Hayden:      Which right now, would you consider us being in a sideway market? We're up one day, down the next, up one day. I would think ...

Allen Sama:        We're still in a pretty good bull market in a sense where we're a 1% or 2% away from the all-time highs. I would say we're still bullish, especially if the fed does cut rates again. We have all this other news going on, all the noise that goes on in the market. But for the last, I don't know how many years, the bull market has been there because the fed had rates so low. I think that if they start cutting rates again, that's just going to signal to the market again that [inaudible 00:21:15] just take it up higher even more.

 In my opinion, yeah, it's a pretty good bull market. Yeah, you can still make money with non-directional trades, but overall I think we're ... I like this type of market where it's going higher, but it's doing it slowing. We're not like shooting, shooting up higher. Not too much volatility for our premium to be good. We can make our 10% on our spreads and not have to worry about too much movement.

Dan Hayden:      That might be help too, is to say, in a bull market, a slow rising bull market, it's best to trade the puts, covered calls. What would be the best vehicles in select markets, that might be helpful too. For me, whatever spits out as I scroll though, and I try to scroll through on Monday morning to determine what I'm purchasing for that next ... What don't we try 25 to 35 days as the best timeframe? Or a little bit longer.

For example, Allen, SPX right now, it's above the three moving averages. Technically this looks like it could be a trade. This is the vertical.

Allen Sama:        I've noticed that [inaudible 00:22:36] here, when you're looking for trades you're looking at the monthly ones. But on some of your trades that you already have on, you've done the weeklys.

Dan Hayden:      Yeah. I try to do it, I think you said the sweet spot is 30 to 40 days out, so I'll try to go 30 to 40 days out. I think those were set last week. That's typically why. Right here, I would look at this 35. If I'm wrong, you let me know. With SPX above the three moving averages, I look at the 35 and look over here on the puts. I would look at is the delta around ...

What do you like? You like deltas around 20?

Allen Sama:        It depends on how many days. I would like to get it as low as possible, but if I'm going in there about 30 days or less, then the delta increases probably about 20. If I'm at 35, I might try to get a 15. But really, we're trying to make 10%, so I'd like to get as far away from the money but still be able to have a potential 10%. The delta in that case, I use it more as a guideline, not as a hard and fast rule that this is the delta I'm going [inaudible 00:23:45].

Dan Hayden:      Just to give anybody ideas, I have it set up so you have the singles on one page, so I can automatically go to what I was looking at, which was the SPX. I'll go down and I'll look for between a 10 anda 20 delta that brings in good returns. I would go down here, let's say, to a 15 delta, 35 days out. It's somewhere around 27.20.

Then on this next page, I already have the verticals pulled up, so I can automatically look and say for the 15 deltas, 27.70, I can almost right away go to 27.20, so 27.20. I am doing 27.20, 27.25, which would be right here. I wish I could show you exactly what the bid-ask spread was, but it could be because of the bandwidth, but I'd be looking at this area. You've got plenty of open interest. It's the SPX, so you can expect that.

 I would be looking in this area between a 10 delta and a 15 delta. Then I'd automatically go over to my, this is up here, so I automatically go over to my scratch pad to make sure that whatever I am trading, I'm making 10% on that money.

Allen Sama:        That's why I think you need the computer instead of the iPad, because you have so many screens open.

Dan Hayden:      That's probably it. But as you get going, I'll minimize these screens for the verticals, and I'll minimize the screen for the singles so that I'm actually overlaying each one. Right away I can go from one to the other, to the other and say, "Yup, that's a trade." If not, then I go right back over here, click this and go to the next stock.

 If you have a big screen and you're at a desk, this is easy to do.

Allen Sama:        Yeah, [inaudible 00:25:47].

Dan Hayden:      But I'm lazy so I carry around a laptop and don't want to hook it into an office. I typically sit on my front porch, and make the trades and make my notes.

Allen Sama:        That sounds pretty sweet, man. Making money on the porch.

Dan Hayden:      I overlook one of the Finger Lakes, so you got to take advantage of that too.

Allen Sama:        Okay, so you told me that your goal was to make about a couple thousand dollars a month.

Dan Hayden:      Correct.

Allen Sama:        Do you think you've been doing this for what about six, five months now?

Dan Hayden:      Correct, yes.

Allen Sama:        Do you think you have the confidence to start going real money?

Dan Hayden:      I do. I do. I have confidence and I have confidence in the selection criteria. I asked you, I said, "This is way too simple. This doesn't make sense." You can get pushed up and above, but you use your rules to get in and get out. You can minimize the losses because in this crazy market, anything can happen. Macroeconomically anything can happen that can impact these markets quickly. We can get pulled around. I've seen in. Where I get in, it makes sense. [inaudible 00:27:04] trading below or above the three moving averages, and then all of a sudden the market goes crazy and does something opposite. I've seen it right at the beginning of this year.

That's the only thing that I have to build more confidence on, and I'm working with the Thinkorswim platform is that when I do make the trades, I am going to start setting stop orders so that if it hits a particular level of a loss, I'm out. If it hits a particular level of a gain, for example, at five cents, 10 cents, I'm just out. I move out, Thinkorswim has a pretty good commission rate so it's not costing me a lot to get out. At five cents I think it's free, and then I move on to the next trade.

 Yeah, the confidence is there. Do I get nervous that I don't want to lose money? Absolutely. But you got to expect that if you have good rules, any money that you do lose should and could be minimized. That's the one thing that I have to integrate into my trading because hey listen, I had the time to be at the computer every single day for an hour, and check on my trades. But as recently, I really haven't because I've been flying around and meeting up with these companies. That's why I want to get good with setting up automatic stops.

Allen Sama:        It's about an hour that you said, you spend about an hour looking at your trades when you can?

Dan Hayden:      Yeah. It doesn't have to be every day, but probably an hour throughout the week. Especially if there's some newsworthy events happening, you want to be on there definitely during that day. But it's probably an hour a couple of times a week. That's only, that's like managing seven trades or so, something like that. It's not a lot of trades, not a lot of time, but typical to when you pick up this laptop or computer, I get carried away and I start looking for some other good dividend playing stocks [inaudible 00:29:08], because I love the scans.

 Here's one that I did looking for dividends, high dividend plays and what I could maybe sell puts on. I'll do certain other things while I am looking at the trades that I have already open to try to create other opportunity.

Allen Sama:        [inaudible 00:29:30] you just love this stuff. You're just into it.

Dan Hayden:      I do. I do love it.

Allen Sama:        If you didn't get sidetracked, it would be so easy. Just log in, check it out and I'm out.

Dan Hayden:      Absolutely. People go on Facebook and all this stuff. It's great to keep up with that at stuff, but I enjoy looking at the stocks, the stock market and just trying to pull a little bit from the market into my accounts.

Allen Sama:        Yup, yup, yup. Okay, you've been ... All right, what else? I had a couple questions for you in my mind. They just slipped.

Dan Hayden:      See because you're probably looking at your screens right now.

Allen Sama:        No, I'm looking at yours. I'm at home. I didn't even make it to the office today, so I'm just looking at the laptop. All I see is your stuff.

  Wait it's funny though, you don't usually Analyze tab. I use that one almost exclusively.

Dan Hayden:      Yeah. Before I got with your service, I used to use it all the time because I used to do these butterflies, and things that I picked up from all of these services that were trying to get your money. So I did use this a lot to analyze broken wing butterflies, and we used to do iron condors with butterflies in the middle to bring the iron condor up higher.

I'm not the smartest guy at this, but I was learning more and more about this as I started to throw on another trade, either to save things or to increase my profit. Maybe it's something I should be using more. Do you use it just to see about your profitability, and when it does break even and start losing?

Allen Sama:        I like putting the lines on the chart, but you know how it says they are add simulated trades?

Dan Hayden:      Yup.

Allen Sama:        I'll just look at that one and that pops up the option chain as well. I'll go down to a specific delta. You know how you were looking at should I do this one, or should I do this spread, or should I do this spread?

Dan Hayden:      Yup.

Allen Sama:        Then I'll just pop it up, I'll just pick one, do it as a vertical and then it'll have the numbers down at the bottom. So it'll be like, "Okay, so the 100, 105, he's giving me 50 cents and then the 105, 110 is giving me 25 cents." I can have two or three perspective trades on the screen. Then I'll just leave it there.

Sometimes I'll do a trade and there is certain stocks, like I know IBM. It doesn't have a lot of premium, but it's a very slow moving stock. I like to trade it, but you have to get in really early. Sometimes you have to get in 40 days or 45 days to be able to get decent premium amount.

Dan Hayden:      [inaudible 00:32:04] decent premium?

Allen Sama:        Yeah, in order to get a decent return.

 I'll go and I'll check it, and sometimes I'll leave it there. Or some other stock that maybe on the chart looks really good, but it's gone up too much or gone down too much. Right now, I'll put in a trade. I'm like, "Oh man, I really want to do this trade but it's only giving me 9%. Oh, gee. Okay." I'll just leave it there in the analyze tab, and then maybe two or three days later or a week from now, I'll come back and I'll look at it again when I'm going through my list, and I'll be like, "Oh okay, this one now, it's giving me 10 and a half percent. Okay, I can do it," because it pulled back or it moved around a little bit.

It just stays there. Then if it doesn't work out, then you could just exit out and delete it, so it's not a big deal.

Dan Hayden:      Now is that in our trading videos? Do you have a session on that?

Allen Sama:        No, I don't think so. That's just something I picked up myself.

Dan Hayden:      Yeah, that'd be cool to go in your brain and see how you use that function with the add simulator trades, because when I went into analyze, I would always go to the risk profile. It's interesting how you use the add simulator trade.

Allen Sama:        I like the risk profile too, just to tell me what is exactly the probability and then I like to put it on the chart. I like to put my break-even line on the chart and just see it. I know your fooling yourself because you think, "Oh, that's so far away. That's never going to make it." You're fooling yourself, but I just like the way that looked.

Dan Hayden:      No, that would be cool for one of your programs just to say something that, "This is how I approach this in monitoring whether I should get into a trade or not get into a trade."

Allen Sama:        Yeah, so we can do that. We'll do that. Let's do that on the next coaching call. I'll go in ahead and go through the screen and we'll do several of those.

One thing I also wanted to mention, you got your scratch pad. That's really cool. But for me, to keep it simple, if I'm doing a five point spread, I'm looking for 50 cents. If I'm doing a two and a half point spread, I'm looking for 25 cents.

Dan Hayden:      Exactly. That's typicalLy how it [inaudible 00:34:14], $1 spread, you're looking at a buck.

Allen Sama:        That's a little bit more than 10%, it's like 11% if you get exactly that. You can say, "Okay, I can go down a penny or two. I'm okay with that."

Dan Hayden:      Yup. You got some flexibility. Yeah.

 You know what else I noticed too, Allen, is when I go to set up a trade and it's a good trade, but it just misses the mark for example if it's a dollar spread and it comes in at 0.08 cents, a lot of times I'll put in 0.09 and leave for the day, and it hits.

Throughout the day, something happens. Maybe the stock changes a little, the prices changes a little bit, but I'm like, "I'm close enough where I'm basically at 10%, but I'm going to set the 10% and walk away." I've had more and more stocks, it fills while you're never there with a good premium.

Allen Sama:        That's a good tip.

Dan Hayden:      Yeah, that's something else that I've done a couple of times.

 Hey, this is the time that you experiment a little bit. You don't want to nick your percentages, but you also don't want to miss out on a good trade because there's some weeks where it's tough to find a good trade. Even the consistent one's just not offering a premium for some reason.

Allen Sama:        Yeah. It goes through different ups and cycles. When you have earnings, it's harder to find a good trade. Sometimes you have to go to ETFs or something. But what you just mentioned, putting in a trade like, "I really love it and it's really close. Let me try it." It's not going to hurt you. You put that on and sometimes because of the way the option premiums are priced, maybe a large order comes in, or the stock moves and down a little bit, and the premium just move more than they should sometimes and you get filled on those.

Dan Hayden:      Yeah, that's been interesting.

You made it really practical, how to approach it. Also, I will say that there's one gentleman who put on the site Excel spreadsheets, which I downloaded and they're awesome. He has a really great profitability chart, so you can put the numbers in and it'll calculate it out automatically. I can't remember the name of the gentleman that did it, but really nice addition in your site.

Allen Sama:        If somebody was thinking about joining the course, the Passive Trading course, what would you say to them?

Dan Hayden:      I would say people can hear what they want to hear, but there's so much pollution out there from these other services. You teach a person to fish so he can feed for a lifetime, and that's what I wanted. I don't want somebody to basically take the steering wheel and drive the car. I want you to teach me how to drive the car so that I don't have to rely on other people.

I would absolutely recommend it. There's as much risk as you want in it, but you control your own destiny. That's the best place to be in because I don't want to send my $1,000 to this service and they're the ones picking out the trades, when in all reality you simplified it to such a fashion that you can join this service, but then you can learn it and move on if you want.

 Hopefully they stay with you and they believe in you because I believe in you right now. You've simplified something that quite honestly as you first join, can be way overwhelming. But you made it simple, you've allowed for three different ways to have extra streams of income, and you teach us to do it. That's the best thing that you can ask for. Yes, I would definitely recommend people to join.

Allen Sama:        That's funny too because you said you've studied iron condors, you've studied broken wing butterflies, which is a pretty advanced trade. But you're like, "I want to go back to this stuff that actually keeps working. I'm not going to go so advanced. I want to try to make it simple so that it doesn't take a lot of time, and you don't ave to monitor it so much and is just a lot less stressful," I think.

Dan Hayden:      It absolutely is because the more things you stop placing on, the more you do have to watch the monitor, and the more you have to react and do other things to fix that broken wing butterfly.

The only reason, Allen, I got into broken wing butterflies is because I paid a service to basically teach me how to do broken wing butterflies. It's probably a really good service, but quite frankly, it's way too complicated. It's not necessary. A vertical spread, if you get good at it, it can be boring, over and over, and over again. But if it's boring and your account is growing, that's a good thing.

Allen Sama:        Yeah. That's how we designed it. We want it to be boring, we want it to be passive so that we can actually go and ...

Dan Hayden:      Enjoy life.

Allen Sama:        ... spend time doing what we want to do. Yeah. There are people that want to be on the screen all day checking their stock, and checking their trades and what not. There's definitely a place for that.

 In the beginning, I tried it that way. To me, the more complicated it got, the more I realized that maybe I'm not the smartest guy in the room, but there is so many extra things that I can miss. I'm like, "I'm just a normal person. This is getting too complicated for me. Let's just tone it down. Let's take something that works, I know it works."

What I love with you is you've put in the time, you've put on the trades. How many trades have you put on since you started paper trading? Just ballpark. 100? 200? 500?

Dan Hayden:      No. It's not that many. It's probably a little over 100.

Allen Sama:        Okay, so 100 over five months. So 20 a month, that's decent. You were practicing, you're gaining confidence, you're learning how you like to set it up with the three screens, and how to monitor it, and set up your charts and all that stuff. That takes a little bit of time, but now I think that you're at the point where, "Hey, I turned 250 into 484."

Dan Hayden:      Right. Right

Allen Sama:        That's [inaudible 00:40:29] double. That's really good. In five months, holy cow.

Now it's time for you to now slowly, slowly transition, I think, into the real money. Maybe you pick one ... Or maybe you start with a small amount of your capital, whatever amount. You start with a little bit. Maybe let's do three spreads and two covered calls a month, or two puts and three spreads, or something like that.

Dan Hayden:      Exactly.

Allen Sama:        Let it out.

Dan Hayden:      With a lot less contracts.

Allen Sama:        Oh yeah. Yeah, of course. Yeah, [inaudible 00:41:04].

Dan Hayden:      Here I'll do 10 contracts every single time. There, real money, I'll probably do between one and five contracts.

Allen Sama:        Whatever the amount you have to work with, [inaudible 00:41:18]. If you have 10,000 to work with, okay, I'll do $1,000 in each one or something like that.

Dan Hayden:      Each one, exactly. Proper money management. Yeah, [inaudible 00:41:28].

Allen Sama:        The contracts doesn't really matter, but the fact that you've almost doubled it in five months means if you were working with a $10,000 account, you would have done the same trades. You would have been almost the same thing. The numbers, you just add zeros at the end for more money.

That's what I love too that you can start out small, do the same exact trade. You don't need $8,000 to do a trade. [inaudible 00:41:48] trade, just add zeros to it.

Dan Hayden:      Yup. I have a Roth account and I keep saying, "I want to grow that Roth account." I think what I've decided is that with the Roth account, I'm going to sell puts. Then if it's executed and I own those shares, I'll sell covered calls really close to the money. Basically just keep transferring the stock. Take big premium by selling very close to the money. If it hits, okay, I'm back into cash. Now I'll sell that put again really close to the money, take a good premium. If it hits, I own the stock and now I'll sell covered calls. I just want to grow that Roth IRA money so that there's a significant amount there that's all tax free.

 I've segmented it there, and then start with my cash account in selling verticals. Verticals is what ... That's the primary breadwinner I should say. Then I have an account that has a company with a significant amount of shares, and I'm just going to sell covered calls on that one. It's like three different accounts with three different principles.

Allen Sama:        The company that you just spoke about, I believe you told us what it was earlier. Why are you in that one? I'm just curious.

Dan Hayden:      I worked for them, so I accumulated shares over the years.

Allen Sama:        Okay, that makes sense. Are you allowed to sell those if you had to?

Dan Hayden:      Yeah, because I don't work for them any longer.

Allen Sama:        I see. Okay, cool.

Dan Hayden:      Part of me thinks about selling them, part to them thinks about just taking an income each months. It's a volatile stock, that's the problem. It can be tough trading, but if you take chunks and you sell covered calls at different levels, like one close to the money where I might lose this, but okay, so I just cashed in on 250 shares, I sell a little bit further out so that I still own those shares, and then 250 I sell a little higher. I don't bring as much premium in, but I know I'm keeping the shares.

Allen Sama:        That's the thing if you work for a company, you have a little bit of a inside track to see how the company is doing. Are they hiring more people? Are they letting people off? If they're letting a lot of people off, okay there's something going on. If they're hiring more people, if they're expanding, if they're spending more money on marketing. You hear all that news that as a trader ourselves, we might not be privy to all of that unless we really dig into the information.

Dan Hayden:      Correct.

Allen Sama:        To be able to trade a stock that you own because you work there, I think that's a big leg up.

Dan Hayden:      Yeah.

Allen Sama:        Even now I'm sure you still have friends and people that work there that you know. You can stay on top of that information.

Dan Hayden:      Yeah, in some instances. But then again, it goes to show that the market will do what the market wants to do because I've been around where we've had awesome quarters and we got hit by the market. We lose. Nothing's a sure thing. I remember those days where we'd have a blowout quarter and we were down 10 points. It made no sense at all. Yeah, it's good to be affiliated with it, but it's also they can throw you curve balls and make it very frustrating too.

[inaudible 00:45:17] go in thinking about vertical spreads straight up and then whatever else you start accumulating through your puts, sell covered calls on, have a method to start creating your stream of income in three different ways. The way you trained us, I think is a beautiful way to begin growing your stock accounts and making money passively.

Allen Sama:        Yeah, and thank you for saying that. One of my goals is the stocks that I buy, I want to get them for free. I want to get so much money back from them that I didn't pay for them. I got my money back. Then you're playing with the house money, and whatever happens happens. I'm okay because I got my money back.

Dan Hayden:      Yeah, that's exactly it. That's why I think young people should be doing this as quickly as possible because they have the ability to do that, and doing it over and over again, taking in the premium which reduces the cost of the stock. Then you're saying, "Hey, it doesn't really matter because I bought this at this, I've taken this much in, and basically I own the stock for free."

Allen Sama:        Then it doesn't matter if it goes down, it goes up. You're getting a dividend, you're like, "Okay, I'm happy."

Dan Hayden:      Exactly. Yeah. Yup, absolutely. You still have the shares, so do whatever you want with the shares.

Allen Sama:        What would you say is the biggest thing that led to your success?

Dan Hayden:      Well success is ...

Allen Sama:        Well I know you're being humble but seriously, but seriously, to double [inaudible 00:46:43], to double your money in five months, I've never done that. You're doing something different, you're doing something special. What do you think caused it?

Dan Hayden:      For me, it was just finding out ... I needed a method to ... I just wanted a recipe. Give me something that is easy, that I can select stocks that makes sense, and then doing it.

 It was basically providing the methodology, which I have because of these three simple moving averages, and then executing. That's it. It's not rocket science. This is paper traded, so you might get a little bit over ambitious with one trade over the other because it's not your money, but just to me, the most important thing was developing that method, having confidence in knowing if it's above or below that three moving averages, and the stock's trading up, and so is the marketplace trading up, it's a good sign that this is going to be a good stock to trade.

Now let's look at what the returns can be, let's look at the verticals, let's look at the individuals to find the right delta. Having that method to basically weed out what you should be trading.

Allen Sama:        Yeah, a lot of people, when they first hear about it they're like, "It can't be this easy." Then you said the same thing.

Dan Hayden:      I did. Yup, I wrote to you and I said, "There's got to be something else I have to throw in."

 You see my screen, this is from the old days where I'd be looking at volatility, standard deviations, [inaudible 00:48:19]. I tried to come up with the best technical analysis and seeing if the stock anticipated to go up, down, what. You don't need this. This was the olden days where I had all this stuff at the bottom and I've just never turned it off. You could take out all that noise, and basically just look at the charts and have confidence in what you do. You're going to have curveballs thrown at you every so often, but be ready for those curve balls, and get out with minimum losses and you'll come out way ahead.

Allen Sama:        I think that's where asset allocation comes into play, especially with the different strategies. If you're only doing spreads and you're only doing put spreads because the market's going up, but then it drops, you're behind an 8-ball, you're in trouble.

But if you're doing a little bit in the puts, a little bit in the calls, a little bit in the spreads, a little bit in something else, then you can weather the storm. It's not one trade will be doing good, the other trade will be not so good.

The way we talk about it is, every month has the potential possibility of being a very good month. If you have a good month, and a good month, and a good month, and a good month, but then you have a bad month, which is going to happen, if you do it right then the good months will overcome the bad months.

Dan Hayden:      Absolutely. Yup, yup.

Allen Sama:        In the long-run, if you look at it a year, two years, three years down the road, you'll be like, "Okay, I'm up a lot. This really [inaudible 00:49:50]."

Dan Hayden:      Exactly. [inaudible 00:49:51].

Allen Sama:        Some people look at it and say, "I tried it for a month and I lost money on two of my six trades, so this sucks." I was like, "Well, that's the way it works."

Dan Hayden:      Exactly. Even the professionals lose. You just have to know how to minimize those losses, and that's the biggest thing. That's something that I have to do. You can see some of these losses that I have to be more proactive in setting up my losses when I set up my trades. The minute that trade hits, I got to go in and say, "Okay, I got to get out when it's profit of this or a loss of that." That's all in your ... I don't have my notes with me, but it's all in your notes for these losses.

 I brought up this screen here that shows my puts. I have Altria, and I'm okay. I'm okay if own this. My fear when I put a put on, like you just talked about earlier, is suppose something happens macroeconomically between they decide not to lower rates, Iran does something, China does something and it drops heavy like Altria goes below that 47.50 put. Well now I just bought it at 47.50, but it's at 45. That's a hurt.

The only thing you can do to get away from that because you're fully exposed when you do this, is just to start selling calls close to the money to say, "I either get out of the Altria and take a minimal loss, or I'm good because I believe it's going to be coming back, and plus I'm making my dividends."

                                We talked about fear, how as a trader, you're fearful of losing money. Well I'm fearful of having to buy Altria if the market drops hard, or AT&T, the market drops hards, and I'm buying it higher than the market's actually at. That's a fear that I have. But if you stay on the sidelines, you don't do it, you don't get your dividends, you don't get the opportunity to buy these stocks at a discounted rate.

Allen Sama:        That's why we do the paper trading too, because actually do it for a few months and you'll get a better idea of how many times did I have to buy the stock? I did it five times, I never even came close. Maybe this fear is a little bit unwarranted. So maybe if I do it with real money, and I do it for a year, two years, three years, maybe I'll get the stock once or twice.

                                That's why with the paper trading, I'll advise everybody like, "Get in trouble. Put some trades on that you wouldn't to get in trouble with it, and so that you can see, how do I navigate my way out of trouble?"

Dan Hayden:      How does it respond, exactly. Yup, yup.

Allen Sama:        With Altria and AT&T, okay, maybe I'll sell at the money put.

Dan Hayden:      Yup, just to see what happens.

Allen Sama:        Just to see, okay, I have to buy the put at this price. What do I do now? Oh, I bought this stock. Okay, how do I get out of that?

Dan Hayden:      The worst time to trade is when you're in fear, you have something going against you and you're nervous. That's the worst time to place that reactive trade.

Allen Sama:        Exactly, exactly. A lot of this stuff is we're dealing with stocks as well, so if you own the stock, there's a great chance the thing will rally in the next 10 years. Anyway, if you're only trading options then you lose, and the month expires, then that's it. That loss is yours, you got to eat it. You got to make it up next month, the next month. But with the stock, you can always come back.

                                Is there anything else you want to share?

Dan Hayden:      No, I greatly appreciate what you're doing in helping others. I really have learned a lot from you. I do, I do I have the confidence again in getting into option trading and having a good plan for doing that option trading. So thank you.

Allen Sama:        Great, great. Yeah, I'm excited to see how you take it and how far you go from here because you got the foundations down, you got some basics, and now it's time to start doing it.

Dan Hayden:      Yeah, well it's funny too because now that I'm working with this company in doing consulting with them, I have income coming in so it's like, "Okay, well I don't have to bring in income with the option trading as much." That psyche comes into play where, "Okay, when I wasn't working I said Okay, I got to make sure that start bringing in X number of dollars a month." That's why I'm not, I shouldn't say as serious because I do look at the charts and all that stuff. I track it probably a couple times a week, but in January, February, March, when I wasn't working for any other company, I was looking at it, looking at opportunities every day, and I was very, very religious about it.

                                It is that psyche, but all I can recommend to everybody is even if you have a full-time job just flat out, 15 minutes, 20 minutes, an hour if you can just to monitor the trades that you have on, but also to look at new opportunities elsewhere. But get dedicated almost like I have a system now by scanning, by reviewing the chart, by reviewing the delta and by reviewing the return. I have a method, and that way have a method each night, each day to give yourself a couple of minutes to look at the trades and to scan so that it becomes second nature. That's the best thing to do.

Allen Sama:        Yeah, definitely. Like you said with the mindset, when you don't have any income coming in and you have to make your nut, maybe $5,000, $10,000 a month, that's when the stress really this you from the trading. It's like, "Oh my God, this trade has to work. It has to work." That's when you mess up.

                                When you have even a little bit of income coming in and you're not totally dependent on your trades, then it allows you to actually trade better.

Dan Hayden:      That's exactly right.

Allen Sama:        That's very helpful especially when people are getting started.

                                I've seen some people where they jump the gun too fast and they, "I want to be a full-time trader," and they jump to fast into it, and they're like, "I have to make money every month." We had one student who did that and the stress just got to him. He placed trades that he shouldn't have and then he lost. On a mental standpoint it just sends you for a tailspin.

Dan Hayden:      Did he need that money or was this supplementing his income?

Allen Sama:        No, he had quit his job to trade full-time. He over traded I believe, and then he lost some money. Now you have to cut back on your lifestyle when that happens. It's not something that ... He has the skills. He'll be back, I'm sure he'll be back. But it hurts in your mind. You feel really down about it.

                                That's why I love it that you're starting and you're saying, "Hey, my goal is to make $2,000 a month." Well okay, if I can make 3%, 5% a month doing something pretty safe, $2,000 a month, I don't need to have a big ton of money. I can put little bit of money, make my goal, and then once you get to that goal it's $2,000 and you say, "Okay, no my goal is 3,000. Now my goal is 4,000."

                                Then eventually you can actually go and say, "All right. I don't need the consulting anymore. I'll just do this." If you love it, you go do the consulting too. It's up to you, your choice.

Dan Hayden:      This isn't something where your going to make a ton of money tomorrow. It's not the day trading, it's not that heavy, it's not that risky type of a trade. This is something where you get good at it and you bringing in a little bit each month. Then like you just said, you bring a little bit each month, you get good at what you're doing, and then you get the confidence to say, "Okay, I'm going to now trade two contracts. I'm going to trade three contracts."

                                Because if you quit your job and you're getting stressed out because you're losing money, then you must be risking too much because you shouldn't be risking too much. You should have proper money management. This is my own opinion, but you shouldn't have that stress, just like you shouldn't be like, "Hey, I am so good at this because I've had all these ... "

                                I don't consider myself good, I consider myself that I've got a new training system so I consider myself a little bit more confident. But I'm not good in any means. But you shouldn't take chances. This isn't gambling. This is proper investing and trying to create a passive income. That's all it is, is a passive income.

Allen Sama:        As you venture more into the real money world, you know that I'm always here. You can email me, we could do the coaching calls, or the Facebook group, or the community, whatever. You know that there is some support there as well.

Dan Hayden:      Absolutely. Yeah, no. You've gotten back to me, you've slapped me on the hand a couple times. Even going onto your site, I wish there was a little bit more interaction between the members because that's where I learned and I picked up that Excel spreadsheet from your one member. I love reading it because it's like, "Okay, I want to learn more. I always want to keep learning."

                                But yeah, I felt, "Hey, I've got these trades. I've really done pretty well. Should I start doing cash trades now?" You said, "How long did it take you to learn your skill? Your lifelong skill?" We said, "30 years." You say, "Well, it's going to take you a little bit longer to get comfortable with it with the practice trading."

Allen Sama:        Yeah, [inaudible 00:59:35].

Dan Hayden:      Yeah, yeah. The support's there, and you do get right back to it relatively quickly. I think it's on our side now where we have to start interacting a little bit more, coming up with, "Hey, this was successful to me, this is what I was looking for, this is what I got, this didn't work out for me, what should I have done differently?" Things like that.

Allen Sama:        We're working on that. Right now, the course itself, we've only marketed it to our own list, so we haven't really gone to the public with it. We haven't let a lot of people in. We only open it up once a month for a few people, a handful of people, and then we shut it down again because I'm working with people, and we're working it out. But once we do expand it a little bit more, I'm working on a couple projects coming up that we'll definitely open up the course and we'll have a lot more people in. Once we do, then that interaction will grow.

                                Currently I'm working ... Right now my major project is I'm working on a book called Passive Trading. Once we get that book into people's hands, they'll see like, "Hey. Wow, this is awesome. I never knew I could do this." [inaudible 01:00:36] in there from students who are doing really, really well. I think that will help as well.

Dan Hayden:      That's awesome.

Allen Sama:        When we get more people in the group then yeah, it'll definitely pick up. But I appreciate you posting in there and doing stuff. Even on the call, I appreciate you coming on a call, and sharing all your knowledge and experience.

Dan Hayden:      Like I said, knowledge and success, it's ... These net liquidating trades, and overall profit or loss, I can't figure them all out because there's other trades that came into play with it as well. I'm probably 10 grand a month or something like that in the profit. That's pretty good since I started.

Allen Sama:        Yeah. You started five months ago, so yeah, that's pretty good.

Dan Hayden:      It's exceeded what my initial goals were. If I can now taper it down a little bit with my cash because I'm not going to be as aggressive and all that stuff, especially to start out with, but yeah, it's been a lot of fun to learn and that's the best thing about it is that I'm not having somebody else have to tell me what to do. I'm learning it and I'm appreciative of that. Thank you.

Allen Sama:        Yeah, man. You could do this for the rest of your life as long as we get older and we slow down a little bit, and our arms don't ... When your back hurts and this hurts, and that hurts, working a job or doing all that traveling might not be an option. But sitting on your porch, like you said, with your laptop, yeah, you'll be able to do that for a while.

Dan Hayden:      Absolutely. If I can get good at this and then teach my kids how to do it ...

Allen Sama:        Oh, game changer.

Dan Hayden:      A game changer is right.

Allen Sama:        That's one of the things I want to do as well.

Dan Hayden:      [inaudible 01:02:14] because you're taking something that's complicating, making it simple, and teaching others to do that. That's great. Good for you.

Allen Sama:        Because this stuff has been around for a long time. But with the advent of the internet, and the brokers, and now everything's at our fingers. Anybody can do this from anywhere around the world, so it's really opened it up for us as individual investors. I think for our kids, it's just going to get even better.

                                We're limited to a little bit of the U.S. stock system. I think when our kids are older or whatever, they'll be trading around the world, they'll be trading on the moon. It's going to be crazy.

Dan Hayden:      It's true. No, it's true. Anything's possible. It's amazing because if you're ... The times that I've gotten into trouble is the times that I haven't got out of trades because, "Oh, it's going to turn around. It certainly can't keep going." It's going down two or three days in a row. You think it's going to turn around, but if you play by the rules, you have your rules, that's where you don't get into trouble and you're out.

                                You said, "Hey, I'll take this little hit. I've made a little loss, but I'll make it back." Or, "I made it on the front side." Almost like your puts. You've owned these stocks and you've gotten so much premium that you own it for free. How much damage can be done?

                                There's no need to take risks, to take chances. If you follow the rules, when to get in, when to get out, it's all good. You're going to have minimal losses and maximum gains.

Allen Sama:        Mm-hmm (affirmative). Yup. You just play it month by month, year after year. The returns, they take care of themselves pretty much.

Dan Hayden:      Yup, and you get so bored that you just say, "Well, here's Monday again. I got to go make some money."

Allen Sama:        Well that's the biggest thing. That's one of the biggest risks is that you get bored and then you don't pay attention. I've noticed that when I first started out. I'll put on my trades and I'd be like, "Uh, nothing's happening. All right." Then, "Oh, nothing's happening." Then I'll just forget to check them, and then, "Oh, something did happen and I didn't ... Ah, don't worry about it. It'll be fine." That's when you get in trouble, when you get too bored.

Dan Hayden:      That's where I am right now because as I'm traveling with this other consulting, you're bored because, "Well, I've made this much money. If they go wrong, I'll just set up new trades because it's paper money." But I got to get more disciplined in my paper exiting so that ... To me, that's the last part of my training right now, is just setting up the trades as I enter the trades to get out.

Allen Sama:        Well you have Thinkorswim, so they have something called OCO orders.

Dan Hayden:      Correct, one cancels the other.

Allen Sama:        Yeah, most brokers have something like that. If you call them up and I'm sure they'll walk you through how to set it up or they might even have the videos on their website.

Dan Hayden:      They do have videos. Yeah, they do have videos.

Allen Sama:        They show you how to do that. If that's what you're looking for, there is a way to do it.

                                Or if you want, you can just have them alert you on your phone.

Dan Hayden:      Yes, you talked about that last week, which is awesome. You can have them text or ...

Allen Sama:        There's ways to run it if you want to find it that way. Then it's totally automatic. Put the trade on and then just put the orders in, "Okay, I'm done. I don't have to do anything at all."

Dan Hayden:      Yeah. Yeah. I lost, but I only lost a couple hundred dollars. Yeah I gained and I made $500, whatever it is. Yeah, that to me, that's relaxation because you don't have to, in that heat of the moment when, "Oh my gosh, it really turned against me. Now I'm down $300. What do I do?" That's the wrong time to be making a decision. Yeah, if the decisions can be already made for me, all the better.

--------------

For more information on the program Dan is part of and how you can join go to PassiveTrading.com

And also visit us at OptionGenius.com

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Jun 30 2019

1hr 6mins

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Rank #15: Interview with Jeff Stanton - 013

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

This is going to be a special edition because not only am I here by myself but today I am joined by Jeff Stanton.

It's going to be our first ever interview podcast. So in the past all the other episodes that we've done I've basically been talking to the mic and I've been talking about whatever topic interests me and we go on and on and try to help and try to share my knowledge.

But this time I've actually been lucky enough to get Jeff on the phone and I'm going to be asking him some questions. Jeff is a professional trader who lives out in New Jersey right now.

Download the Free Option Trader's Treasure Map:

http://optiongenius.com/map

Join Our Free Facebook Group called The Option Trader's Alliance:

https://web.facebook.com/groups/465974750429703/

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LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
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Jan 02 2018

56mins

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Rank #16: 2018 Predictions - 014

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Around the end of every year and beginning of the next, the world is flooded with folks giving their predictions about what will occur in the coming year.

Some of these actually come true. But most are just for fun. These fortune tellers think that something might happen and because of that something else might occur. Mostly these folks are just looking for some free publicity. Which is why I hate predictions.

Don’t give me a guess. Give me some real information that I can use to make an educated guess

So what I like to do instead of to look at trends. Long term trends. I am a more Macroeconomic guy than micro if you know what that means.

And one of the folks I look up to is Jim Rogers. This guy started the Quamtum Fund with George Soros and made billions.

His whole philosophy is to see where the money is sitting in the corner and go pick it up. No need to fight for it or work too hard.

Sounds pretty good to me. So then how do we use this info

Well you look at what has been happening in the world, compare it to history and see what you see.

Stop looking at the minutia, the day to day news and look at the big picture.

These are the Top 5 Trends that will shape 2018.

Resources and links mentioned in this episode:

Jim Rogers

Bitcoin Episodes:

Episode 006 – Bitcoin Scams You Need To Be Aware Of

Episode 007 – How To Invest In Bitcoin

Contact help@optiongenius.com for your questions

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Join Our Free Facebook Group called The Option Trader's Alliance:

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  2. FREE 9 LESSON COURSE: https://optiongenius.com/
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Jan 17 2018

20mins

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Rank #17: The Option Continuum - 21

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Okay so in this episode, I'm going to be doing things a little bit different because this is going to be a video and an audio podcast because I do have some graphics to share. Now, if you are listening to the audio and you want to watch the video, you can do that at www.optiongenius.com/continuum.

So I want to start with a couple of questions. Number one, how long have you been trading options? And number two, in one word, how would you describe your proficiency of trading options. So in other words, what level trader are you? Kind of gets confusing, right? Sometimes. Because you don't know exactly.

I ask this because it's super important to know where you are before you can make any progress. You have to know where you are so you can make the necessary correct improvements and even know what needs to be improved in the first place. Because in most areas of life, this is what's called a benchmark, right? So, if you know where you are now and you know they'll you want to get to, then it becomes pretty easy to get there. You can make a plan and you can just follow step by step by step and get there.

No big deal. You just work on the skills that you need at the next level. But in trading, nobody ever talks about this, you know? There's no set criteria, there's no levels, there's no advancement. You know, even in college, you go to college you say, "Oh yeah, you're in college. Oh yeah, what year are you?" "Oh I'm a freshman, I'm a junior, I'm a senior." You know where you are, you know what you have to do to get to the next level and you know how many levels there are so, you know when you're gonna finish. In trading, we don't have this so, you hear terms like, "Oh, I'm new to options."

Okay, what does that mean exactly, you know? Did you just start trading yesterday? Have you been trading for three months but you're not very good, or you're not confident in it? Who knows? Or, "Hey, I'm an advanced trader." What does that mean? Are you making money? Do you know 15 different strategies and 12 different adjustments for each one? Does that make you an advanced trader, you know?

Or maybe you've just been doing it and losing money for the last 20 years trading options. Maybe that makes you an advanced trader. Or maybe you've been to 15 different seminars and you know all the lingo but you've never done trade in your life. Does that make you an advanced trader?

Nobody knows, right? Because at Option Genius, we get emails about this all the time. We get people who want to know what course or membership that they should join and some of them, not all of them, but some of them try to make it easy on us by giving us a little background on themselves.

But it's almost never enough. No we are not licensed financial people so we cannot give personal advice, right? But if a product is wrong, one of our products is wrong for you, we'll tell you, "Hey, you know, this is not for you based on what you told us." The problem is that we don't know these people well enough and we've never had a way to characterize them.

For example, an email might come to us, might be something like this, says, "Hi, I've been trading options for three years and I really like your weekly trading system site." For example. "I'm retired and I have $20,000 to work with. Would this be the best product for me?"

And to be honest, really, I have no idea. The email says he's been trading for three years but trading what? What strategy? Was he profitable? Was he not? Does he really understand it or not? Why does he want to jump into weekly options? Has he been doing monthly options, he been doing leaps? I don't know. You know? I mean we can go back and forth, emailing back and forth just to try to figure it out.

So, I think you can see my conundrum, okay? No I mean, is someone who is only a covered call trader, is he a basic options trader? And someone who knows, for example, ratio spreads, are they an advanced trader? Well what if the covered call guy makes a lot more money than the ratio trader? Now who's the more advanced trader, you know? It's kind of confusing. So, I decided to sit down and end all this confusion.

So I have come up with what I call the, "Option Continuum," basically, it's a scale, which you can easily tell what level you are at in your trading. And once you know your level, you can decide what level you want to move to and then you start working on those specific skills to improve.

Now, everybody does not need to know every strategy to do well, okay? That's up to you. You could get to the top of the continuum, the end of the continuum and only know one strategy and just one way to trading. It is possible. Or you could say, "You know, I need to know five different strategies in case one doesn't work or the market changes or whatnot and I need to know five strategies and be good at them in order for me to get to the top." That's fine, you know? But I don't think that you need to know every single strategy.

Nor do you need to understand say 20 different technical indicators, you don't. So the continuum will help you in many ways including, this is a big one, not jumping at the next shiny object that comes your way.

And I think you know what you're talking about because I know how it is, I get them too. The daily emails touting the newest, the coolest, the most profitable trading strategy that's gonna make me millions, right? I get pitched ten of those a day if not more. But once you know what level you are at, you will be able to determine what you need next and eliminate all the other noise so that you stop jumping from one course to the next, from one guru to the next.

Because that ride never stops, it's like a merry-go-round. Once you get on the merry-go-round, they keep pitching you more stuff and more stuff and more stuff. And if you're done with one guru's stuff, that guru will pitch you stuff from someone else and it just continues in a circle, on and on and on, you never get off that ride.

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Mar 27 2018

27mins

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Rank #18: How To Make 400% With Financial Journalist Wayne Duggan - 51

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Okay. So Wayne, I see that you have a book that you have written about trading in the stock market. And the title of the book is "Beating Wall Street with Common Sense", which is an interesting title by itself, but then it goes on. It says, "How I Achieved a 400 percent Return from My Dorm Room". And so I saw that book, and I was like, "Hey, that's really cool". I bought it. I read the thing, and I looked you up and it turns out that you are actually a writer as well.

Wayne: Yep.

Allen: Yeah, so, I mean-

Wayne: Yeah, I'm a journalist.

Allen: The funny thing about the book was that, I think it was the first line of your book, or the first sentence is, "I am not a writer".

Wayne: I know, it's ironic, because at the time I wasn't. But the book kind of jump started my whole different change in career for me. So I can't use that line again if I write another book.

Allen: So why don't you tell us about that. How'd you get 400 percent and how'd you get into the whole stock market game?

Wayne: Well, I talk about this a little bit in my book, which is that growing up I've always been kind of a numbers person. I was a big baseball fan, I was hardcore into baseball statistics, and I always had a fascination with the stock market, but I didn't really know much about it. And then when I went to college, I majored in brain and cognitive science, which is essentially a combination of psychology and neuroscience. So I didn't really take any finance courses or anything like that. And, as we all do in college, you have some boring classes sometimes, and I was actually in graduate level courses in 2008 when anyone that was investing at the time knows, because it was obviously a lot going on in 2008, so I actually started reading up and learning about the stock market for the first time, and decided I wanted to dip my toes in and invest. And, like any new investor, I obviously made a lot of mistakes, I tried to learn from those mistakes, and I was fortunate enough to where I timed a good entry point. I like to think I had some decent insights into some good stocks to buy, and fortunately it really worked out for me.

Wayne: And I talk about all this in the book, and one of the things I wanted to do with the book is make sure that I don't hide my mistakes, even my embarrassing ones. Because I think that's important, I think it's... everybody's going to make dumb mistakes when the start out, and you shouldn't be ashamed of that, you should just make sure you understand why you make them and try to learn from that.

Wayne: So with the book... writing a book was always on my life bucket list, so I wrote the book, I actually tried to get it published through a publisher, but I had no experience writing as I said in the book, and that was one of the things I consistently heard from publishers was that, we really like the book but we're looking for authors that already have an audience built. So they were like, you should start a blog, you should try to get some freelance work, and maybe the next time you write a book we'll be more open to the idea of publishing it, and so I kind of started writing for Motley Fool, Seeking Alpha, websites like that. I had some success there, and I ultimately kind of ended up changing career paths. Now I write full time for benzinga.com and I contribute for US News and World Report and Investor Place.

Allen: Cool. So I definitely want to ask you about the mistakes that you mention. But before we do that, how did you get 400 percent, and over what time frame?

Wayne: I think it was over about... well first of all, I can't take full credit for it. Because the first stock I ever bought was in December 2008, so that was a pretty darn good time to start buying stocks. So obviously if you bought just about anything in December 2008 you would have done pretty well over the next few years. I think the time frame... I don't remember exact, I think the book I wrote in 2011, so I think over about three years I generated more than a 400 percent return. Which I think is pretty good, nothing crazy, but I mostly took the approach of trying to identify high quality stocks that got slaughtered during the downturn and that I thought got unjustly punished and I think my largest profits came off of buying big bank stocks.

Allen: Yeah, they were beaten down a lot. Most of them were like...

Wayne: Yeah, I think I got Bank of America in early 2009 at point during my trades, I think I bought it at two dollars and 75 cents a share or something like that.

Allen: So basically, it was really really good timing.

Wayne: Yeah. And I like to think that wasn't an accident.

Allen: Did you trade options at all? Or was it all stocks?

Wayne: Initially I didn't. I think my first big option win came in 2011, and at the time I was just wanting to learn about options, I didn't really have any experience but I was always interested in it, so much like trading stocks a couple years prior I sat down and researched and tried to teach myself about options. My option trading, I always did it purely as speculation. I was buying calls, inputs, which I know is opposite of what you recommend, and also for my experience, the opposite of the way you should approach options unless you're doing it the way I did which was pure speculation, fun, gambling, lottery ticket type stuff. Which is what I was doing at the time.

Allen: It says here that you did it when you were in college. So how did you get the money to start?

Wayne: I started small, which is another thing that I would recommend for anybody that's starting out. It was just some money that I had put away, and it wasn't a ton of money. I think when I first started I had maybe 2000 dollars or something like that. It wasn't anything big. I really just wanted to learn the ropes and I think it's... that's one of the pieces of advice I'd have for any new investor, is if you're in your 20s and you're thinking about stocks, but you think oh there's plenty of time to do this, I'll learn it whenever, I think it's good to get in when you're young, make your mistakes early, make your mistakes when you can afford to lose a little bit of money, and then, by the time you really have real money to work with, you kind of know the ropes and know what to do and what not to do.

Allen: That's well said. How old are you now, by the way?

Wayne: I'm 35.

Allen: 35. Oh man. You still got a lot of stuff to learn.

Wayne: Yeah, I feel like I'm fortunate that I started relatively young. Because again, even if I had lost everything at that point, I think when you're 26 years old, you got plenty of time to recover and you're not throwing away your retirement savings or anything like that. You're not derailing your financial future. So I always tell people, definitely start young.

Allen: You won't believe how many stories we hear from people that are in their 50s and 60s, and they come to us and they say, "Hey I just got started and I lost a bunch of money". Now it's not too late, but if you had started earlier or if you had been doing it a little bit safer, you would have been in such a better boat.

Wayne: Absolutely.

Allen: So Wayne, how have you been doing since then? So that was a few years ago, the market's been in a really nice bull trend. What do you do now, how do you invest now, how's it going?

Wayne: I've been doing so so lately. And to be honest, I have not been trading much lately. Once I started working full time doing financial journalism... I found that I had a lot more time on my hands when I was screwing around in school then I do when I'm working eight or nine or sometimes 10 hours a day with three different jobs. I've kind of... most of my money, honestly, is in CDs right now, but I have a couple of speculative investments, Alibaba is my biggest position and a couple oil services stocks that are pretty beaten down that I feel like have been unjustly punished. I really don't, I'm literally... my Merrill Lynch account is probably 90 percent cash or CDs at the moment.

Allen: That's really interesting, because you are in this market all the time. You're learning, you're hearing the noise, you're hearing, oh this stock went up and this stock went down instead of doing this instead of doing that, but you're not even inclined a little bit to jump in and say let me make a fortune off of this stuff.

Wayne: Well, I feel like it's always a good time to buy and hold an S&P index fund as long as your timeframe is 10, 20, 30 years, something like that, but I honestly don't see anything out there, or very few things, that just smack me in the face and that they're under-priced or look cheap or undervalued. If I did I'd buy, but I honestly don't see much out there. I also think it's kind of just a weird time, after at 10 year old bull market and interest rates are so historically low... there's just a lot of screwy things going on and I'm not inclined, I'm not a professional investor, so I'm not inclined to always have my money all in all the time to have food on the table. So I'm just kind of on the sidelines until I see another opportunity... probably another 2008s not going to come along anytime soon, hopefully not at least, but at least something where I say, "Okay this looks like a no brainer".

Allen: Okay. So you're totally value. You're into beaten down stuff like you said, and just wait until it comes back and you'll wait until it comes in.

Wayne: I'm mostly value. I talk about in my book, I'm a firm believer in exploiting the psychology of the market. So I'm kind of an investor sentiment, contrarian investor as well. So contrarian investors, when the market's great and everyone is saying stocks are great and everything, that's not the time contrarian's like to buy things. So these days, everything seems like it's on cruise control, I like to buy when there's blood in the streets. And there hasn't been much blood in the streets for nearly a decade.

Allen: Interesting. That's a different way of looking at it. Because a lot of people they always feel, yeah I have to be invested, I have to have my money in there, it goes up seven, eight percent a year, 10 percent a year so I need to take advantage of it. But you're saying that you don't need to do that.

Wayne: Like I said, if you're trying to trade for a living, then you need to be trying to profit. But if you're trying to do it for retirement or like I do kind of as a hobby more than a profession, yeah, I mean... if I go to the mall and I'm walking around and I see something on sale that I like, I'll buy it. But I'm not the type of person that goes to the mall with 100 dollars and leaves with zero dollars every time, no matter what's there. So, I got the cash, if I see a stock that looks cheap, I will jump in there. But if not, I don't feel the need to always be hunting down things to buy.

Allen: Interesting. So, now you mention investor sentiment, and psychology. Can you go into that a little bit? How would somebody find that out or how relevant have you found... obviously you rely on that, but how important is that?

Wayne: Well, it's one of the more popular contrarian indicators of how a stock performs. In my experience generally, if you're trying to beat the market then you can't be doing what everybody else is doing, because by definition if you're doing what everybody else is doing you're not going to beat them at that game. So you need to be doing something different, you need to either be seeing something before everybody else sees it, or you need to be seeing it differently than everybody else sees it. Nowadays, with high frequency trading, institutional investors, in my personal experience I feel like it's extremely difficult for an average retail investor like myself, to be faster than the market. It's very, very difficult.

Wayne: So I have to, my only window of opportunity, is identifying stocks where I see something differently than everybody else sees it. And it think one of the things that has tended to happen in this digital age is that people are impatient. So I think back in the day people would buy stocks, it would be common for people, even traders, to buy stocks and be willing to hold them for six weeks or six months or nine months or even a year or two, while their thesis plays out. But I think over time, just has society has sort of sped up and the digital age has sort of encouraged instant gratification, I think people don't even a lot of the time, they don't think nine months or 12 months down the road anymore. If something's not going to work today or tomorrow or next week, it's not even on their radar anymore.

Wayne: So I think those are time where... I'll use Alibaba as an example. If you look at the growth numbers that Alibaba's putting up, without any knowledge of this trade war that's going on, if you just think about the economic growth rate in China, the fact that they have the billions of people, the fact that the government basically restricts international competitors from coming into the Chinese market, that company's been absolutely tearing it up. And they're into all the high tech fields that Amazon is into the US. And yet, the stock has been stagnant for a while now, and it's because investors can't see past this trade war.

Wayne: And personally, I believe the trade war is coming to and end sooner rather than later, because it seems like it's hurting both the US and China, and I think Warren Buffet said this in his shareholder letter or an interview at the annual Berkshire investment meeting or something. But basically, when you have two rational actors, and there's a conclusion that's in the best interest of both of them, they're eventually going to make it there. And I don't know what the terms of the trade deal are going to be, and I don't know if it's coming next month or a year from now or whenever we get the election over with or whatever, but I believe a trade deal is coming at some point. And I'm personally hoping that completely shifts investor sentiment on Alibaba and that people start taking a closer look at those numbers.

Allen: Okay. That's a cool way to... do you sell options while you're waiting or no?

Wayne: I don't. And I figured you'd ask me about this, and I will say this, if I had more time on my hands slash wasn't so lazy, I definitely would be doing it. It's something where, after working a full week where I'm seven AM to five PM stocks and options and trading all day long, at the end of the work week I don't even want to look at my porfolio, I just want to relax. So yeah, if I lose my job at some point I'll definitely start selling options.

Allen: All right. So then, what were some of the mistakes you alluded to earlier, that you think that ordinary, common, everyday individuals are making that they shouldn't. Or that you can protect them from, just letting them know. What do they need to know?

Wayne: There's a lot. Maybe I should just answer just in terms of buying options. Because I think, and if you're preaching selling options then I like to think you'll probably be on board with all of this, but when I first started thinking about options and how if you buy options it basically gives you leverage where you can theoretically make really large returns on stocks that aren't super volatile, I thought well geeze this is the golden ticket and I thought that, well, I've had success buying stocks and holding and ultimately my thesis plays out and I've profited off of this. But, the time factor with options, the reason why it's smart to sell options and not buy them, is because you have to get two things right when you buy a stock - you have to get the stock right and you have to get the direction right. When you buy options, you have to get three things right - you have to get the stock right you have to get the direction right, and you have to get the timing right.

Wayne: And I think most people are predisposed due to their personalities either to be too early or too late when it comes to timing their investment thesis. I tend to be too early, I tend to think things are going to happen before they actually end up happening. So what I found early on in trading options is like, oh, I'll use Alibaba again as an example, oh, I believe a resolution to this trade war is going to happen. If you had asked me in December when I thought it was going to happen, I would have definitely said I thought it would have happened by now. By June, I definitely would have thought there would have been a trade deal.

Wayne: So maybe back in December, I would have thought, oh, there would have been a trade deal by June, I'll buy June call options out of the money on Alibaba and by the time June 15th rolls around I'll be good to go. Well, nothing's really changed about my thesis, I still think that a trade deal is going to be reached and Alibaba stock's going to go higher, but if I had bought those call options back in December I'd be out of luck. They would have been expired, completely worthless. So the shame in that is that your thesis can end up being right, but if you don't get the timing right, you're completely screwed and it doesn't even matter, it's as if your thesis was just completely wrong.

Wayne: So I think that's what I would say to anyone looking to consider buying options rather than selling them, is you're basically playing... the stock market goes up over time, historically. So if you're just buying generic stocks you at least have kind of of advantage in the sense that the economy is growing. But if you buy options, call options or put options, you're at a tremendous disadvantage in the sense that you need something to happen just to break even on your trade. You're starting off in the hole because of the time value decay and I think people overestimate, they tend to have too much confidence in their ability to predict timing, and I think a lot of people get burned on options like that.

Allen: It's like a ticking time bomb. It's just tick tick tick every day.

Wayne: Absolutely.

Allen: Cool, the one thing I wanted to mention to everybody watching your book, when I bought it I thought it was going to be basically your story. Which it is, it's your story. But I think that's about half of it. The other half is you actually talking about investing and all the jargon and what goes on in the stock market, basically from A to Z level. And I think that if somebody is new to trading or new to stocks or even options, if they pick it up and they read it they'll learn a lot more than normal.

Allen: Because the stuff that you are talking about, I know for me it took me several years of not only just trading but watching CNBC a lot to understand all of the ways, how everything works together and how does this react to this. There's no guide for that, it takes a long time to understand, okay fed's going to cut, what is doveish, what is hawkish, what is doveish, they keep mentioning these words I don't know what that means. But in your book it covers everything, and I was like oh man I wish I had this so much sooner, it would have made so much sense.

Wayne: It's, and I thought long and hard about how I wanted to approach the book at the time, because I feel like there is certainly a jargon to Wall Street, and it can be incredible intimidating if you're starting from scratch. And it was even to me. When you start out, it's like learning a new language. When you start out your first day of French class and people are speaking French, you're not going to know the first thing about what they're saying. So I tried to write the book that I would have wanted to read when I first started out. I remembered how intimidated I felt and I remembered how ignorant I was and I... obviously when you're first starting out trying to learn something new, you're going to be ignorant at first, everybody is. And you're going to make mistakes at first.

Wayne: And so, I tried to tell my story, like you said I tried to tell my story by also tried to work in things that I learned. And yeah - a lot of your listeners that are advanced enough to be selling options and making profits, maybe they'll learn a thing or two from my book, but maybe they got past that point a long time ago. But, maybe they would like to read about my story.

Wayne: But I think the perfect audience for that book is someone who is a bit intimidated to start out and they may not necessarily want to read a book written by someone who has 20 years of experience at a hedge fund. Maybe they just want to read a book about someone who was a random person, an average college student like they are or they were, and started from scratch the way they're starting from scratch, and know that like, yeah, it can work out. It won't be perfect, it'll be bumpy, but it can work out and here's the story that proves it.

Allen: Yeah. And then, the other thing that you talk about is common sense. So, that's the title of the book, "Beating Wall Street with Common Sense". And it's, you mention it and it should be common, but it's not as common as you think. And I think that's part of what makes a market, me and you could look at the same thing and I'll be like, "I want to buy!" And you're like, "No, I'm going to sell it". So how do you say common sense? What is common sense in the stock market?

Wayne: I think the best way to explain it is... and I've written about this for my job, is I think that unfortunately we are predisposed to... human nature has a lot of inherent biases, psychological biases, and when you're talking about hard earned money, your retirement savings or just a few thousand dollars that took you however many hours to earn, it's very emotional to see your account going up or down every day. And we have deep rooted, biological predispositions to avoid losing things that are valuable to us. So I think one of the most important lessons to learn for a new investor is to control your emotions. Because I guarantee you your emotions will almost always have you making the wrong decision in terms of trading, because you will be most fearful at the time you should be buying, and you will be most greedy at the time you should be selling.

Wayne: And so, I think the common sense part to me is, the market may seem random sometimes. But the market is just a collection of individuals and institutions run by individuals, and the decisions they're making, they're basing those decisions on human logic. And so, when a stock is going up or down, on any given day those movements may be random but on a longer time frame there's a reason why a stock is going down or up. It may not be logical, it may not necessarily be correct, but the reason that it's going up or down is because people have certain beliefs about that stock, and they're buying it or selling it in response to that.

Wayne: So if you kind of remove yourself from trying to think about why the stocks going up or down and you think more about why would somebody be buying or selling this stock right now, and think about it more from a psychological perspective, then that sort of gets you to where you can think, okay, well when is this person that's selling this stock... why is somebody selling Alibaba right now? Oh they're selling because they're worried about the trade war. Okay, that's why Alibaba stock is going down. Okay, well what can change that will make that person say, oh, well now I want to buy Alibaba stock? Then you think oh, well if the trade war comes to an end then that person may completely change their mind.

Wayne: So that's not... you can dig as deep as you want to into financial metrics and numbers, and as a value investor at heart I'm a big fan of value investing metrics. But I think in terms of how the market moves, the market doesn't necessarily move because of a stock's price to earnings ratio. It moves because people have certain feelings or thoughts about a stock, and they're buying or selling it in response. So you really need to, as much as it's good to understand all the metrics, I would advise people to take a step back and think, whether I agree or disagree with what's happening, why is it happening? What are people thinking about this stock and what will change their minds at some point in the future?

Allen: That's interesting you say that as a financial journalist, I want to go to that. Because one of my questions I was going to ask you is, as a journalist you have deadlines, and you have to write about certain stories, you have to put out a certain amount of content. And every day, the market might be up five points or might be up 15 point or oil drops one percent or two percent, there's always a headline. There's always an explanation, right? So how do these financial journalists come up with these thesises, of why something happened? Like you just said, we don't really know why it happened it could be some people think this way or some people that way, there's no survey, people are not telling everybody why they're doing things. But how do these journalists come up with these headlines and say, market moved, or this stock moved, or this happened because of this today.

Wayne: I would like to think that good journalists, they don't write definitively. They say well, the S&P was up one percent today, and then I'll reach out to traders and be like, what are you hearing what are people saying, why do people believe that the market is up today? Or a lot of times, I'll reach out to economists or analysts and I'll get their opinions, and then when I write my story I won't present it as my opinion of what's happening, I'll present it as this is what traders are saying is happening, this is what economists are saying is happening, this is what analysts are saying is happening. And then, I may or may not draw a conclusion, oftentimes I will, but I don't present it as, all right I'm god's gift to earth, I've come to save the day, this is my journalistic opinion of what's happening.

Wayne: I don't think that that's necessarily helpful to people, I think people want to know a collection of sources, or even just one source, if one analyst puts out a note saying this is what happened today, we may do a quick summary of that or whatever. But for Benzinga and US News, they don't so much care about my opinion. For a stock picking site like Motley Fool or Seeking Alpha, I mean they make that clear that that's more opinion, editorial pieces. But in terms of my journalist jobs, they actively don't want me putting my two cents in there. They want sources with expert experience that are going to be the root of all of our stories.

Allen: Okay, cool. That makes sense. Because a lot of the times I'll read something, it'll be like market was up six percent today and it's because the fed announced that they're going to do this and this and this. Or China said this and this. And then the next day, it's going to be like oh the market is down five percent or two percent today because China did this and this and this. Wait a minute, you just used that same excuse yesterday for the market going up. So it's really hard as an individual to figure out, okay what is happening really? So the next question is, how does an individual trader or someone at home, how do they use the news? What would you suggest in that?

Allen: So, a lot of the times, one of the things that we do is we teach people how to do backtesting, which is a piece of software where you go back in time and you only look at the chart, you only look at the stock. You don't know what's going on in their market, you don't know what the news is, you don't know the headlines or anything like that. So you don't have that noise basically, is what I call it, the noise of what's going on. You're only trading the chart, the stock, the numbers in front of you. And most of the time, people who do that, they actually do better with the backtesting than they do in real life trading, even though they're using the same plan or the same rules. So how would you suggest that we use the news or... and obviously you're not going to tell me never to listen to the news, because that's your job, but how do we take advantage of the news?

Wayne: Well, if you're day trading, I think you need to think of the news as... every headline is a catalyst in the short term. If you're investing for the long term which is more of what I do, you used a good word, I think the news is mostly noise. I think it's good if you're a longer term investor to make sure you always keep abreast of what's going on with the stocks you own, because you don't want something coming out of left field. You don't want to just not pay attention for a week and then you come back and all of a sudden a week ago, there was an SEC investigation into your stock and it's down 40 percent. I think you need to always keep up with the news, but someone that, if I was advising someone that's not trading in the short term but more investing for the long term, I would say read the news but don't lose sleep over it.

Wayne: If you read a headline that fundamentally changes your investment thesis, then you should think about maybe trading or adjusting your position. But some quarterly earnings report that wasn't very good but you still think the company has a great long term future ahead, that's just noise, honestly. Or the CEO steps down. Well, if the CEO is 88 years old with health problems, that's understandable, that doesn't change anything about your long term investing thesis. If the CEO steps down because he was was arrested by the Department of Justice or something, maybe that's a red flag.

Wayne: I think most of the day to day news, this is coming from a journalist, we want to write about stocks that people are reading about, but it may seem like a certain company is in the headlines all the time, but that doesn't necessarily mean that more stuff is going on at that company, it just means people care about that company and that's what people want to read about. So I think the news is important, I don't think it's the end all be all in terms of investing, especially if you're a long term investor. Just think of it as part entertainment and part information and don't stress out too much unless something major changes with the company.

Allen: Okay. And then, you mentioned that you do work, or you have done articles in the past for Motley Fool and Seeking Alpha. So I was wondering, you mentioned that you had just gotten out of college and you had started writing for those. What are the requirements for those? Because sometimes people read that and they take it as gospel or they take is as somebody who actually has done dozens and dozens of research, or years of research into something where their thesis is so airtight. Can anybody write for those or, how does that work?

Wayne: It's been a while since I've written for either, but honestly back in the day there wasn't too much of a screening process. I think at the time I think you submitted sample writing and the editors just read it and decided whether or not it made sense to them. So I would absolutely take everything you read online that is recommendations to buy or sell stocks or trade in any capacity, I would take it all with a certain degree of skepticism. In fact I wrote a story for US News less than a month ago specifically about cannabis stocks, and about how there's a lot of misinformation out there online specifically about cannabis stocks. So you need to always... when you read something online, always in the back of your head need to understand the credibility of the source.

Wayne: And people have their favorite news outlets and ones that they don't like. But regardless of which ones are your favorites, legitimate news outlets are not just going to straight up lie and deceive people, because they'll open themselves up to all kinds of lawsuits and whatnot. But, there are plenty of nefarious websites out there or message boards, or people who are self interested or even paid by the companies, that will straight up lie about what they believe about a company. And it may not even be that they're just straight up lying, it may be that they own shares of a stock and they're completely blind to a different way of looking at things because they're along that stock, so the company can do no wrong and everything's always rosy and obviously that's a very biased opinion.

Wayne: So anytime you read someone telling you buy this stock or sell this stock or option or whatever, you always need to remember, who is this person, why are they saying this, what are their qualifications? Because you don't want to be blindly following anybody regardless of their qualifications, but people... certified analysts, people who have backgrounds in finance or backgrounds in journalism or whatever, they at least have some degree of experience. You're right, I wrote that book about my experience in the market, and my first professional writing gig was with Motley Fool. They like to think of it I think as more just like a crowd-sourced... like my articles weren't Motley Fool's opinion of the stock I was writing about, I was just one of hundreds of writers they have writing. So it's more of a platform than I was writing, speaking on behalf of Motley Fool. But yeah, people should be careful out there for sure.

Allen: I mean I do remember, even during the dot com bubble, 1999 and 2000, at that point everybody was going gaga over, this time it's different, oh these dot coms are going to change the world. And a lot of the journalists were the ones that were banging on the drums the hardest. Yeah, everybody's got into this, you got to get into Lycos, you got to get into all these other sites, companies that went out of business, pets.com and all this stuff. It seems like those people that were those journalists, they disappeared for a while because nobody wanted to hear their things any more because everybody hated them. But now they're actually back, and I see them on the news and I see them on the different financial channels, and they're still giving advice as if they knew what they were talking about back then so now, why should I trust you now.

Allen: Then the other thing is on the TV shows, the guys who come on from the different hedge funds or the money management companies or the banks and whatnot, a lot of them are basically, they're talking their own book. If they're the market maker or they're the company or they're the bank that's taking a certain company public, there's no way they're going to say anything negative about that company on air, or even that whole industry. Just going to be saying good stuff. And that's the thing, when we're watching that as an individual, we don't know where their conflict of interest is, we don't know what's going on behind the scenes. So I really appreciate you saying that. As a journalist it takes guts to come out and say that.

Wayne: I'm... journalists... I feel like your title in life, your profession says something about your experience. But it doesn't make you infallible. Whether you're a journalist, a doctor, a lawyer, a teacher, everybody's just people. And people make mistakes. And in terms of accountability, I always thought this was crazy because I'm a big baseball fan, if I'm watching a baseball game on TV, if I'm watching the Red Sox and a batter comes up and steps in the batter's box and I don't know who that guy is, the first thing you show when you get in the batter's box is a line across the bottom of the screen showing all his statistics, how he's performed, what's his batting average, what's his on base percentage, how many home runs how many RBIs does he have. I don't understand how these people come on CNBC and all that shows up is their name or where they're from. And maybe they've been on CNBC 200 times, and they've made 200 stock picks, and they've gotten 190 of them wrong. You wouldn't know!

Wayne: And it seems to me it would be so super easy to keep up with these analysts and journalists and pundits that are on TV and what stocks they pick and how often they're right, how often they're wrong. Show their name, and show the percentage of times in the past they've been right or wrong. Because I don't know about you, but if somebody's only been right 15 percent of the time they've been on CNBC talking about stocks, I probably am not going to really care what they have to say, honestly.

Allen: Well you know the reason they don't do that is most of them are wrong a lot of the time, and nobody would watch it.

Wayne: I know, that's true. If they were good at picking stocks they wouldn't be on CNBC.

Allen: There are certain people like... I used to watch the show Fast Money. I still do, still record it and watch it from time to time, and they've had a couple guys on there that were regulars, that every time they say something it's like man, you have no clue what you're talking about, and I would go and say let me try and see if I can do the opposite of what that guy just said. Because he's such a...

Wayne: That's a real thing.

Allen: And yeah. A lot of people do that. Jim Cramer comes to mind, a lot of people are like I'm going to take the opposite side of him.

Wayne: People give Cramer a hard time.

Allen: It's tough for him to be him. But I do credit him in a sense, that there's a lot of time when the market is moving in big moves, and I really can't figure out why, I don't know what's going on. And the news doesn't help, the headlines don't help, but on his show, he actually gets into the meat of it sometimes because he's been in that world. So he'll be explaining it, "This happened and this happened so the hedge funds are thinking this and this, or that's why they're moving a lot of stock". Or "This happened overseas that was not reported and that's why such and such is happening", or something like that. And in the past he has helped me out in that sense, to make sense of what was going on.

Wayne: I'm actually a big fan of Jim Cramer, I know his stocking picking track record is questionable. But what I think he's great at is I think he's great at educating people, I think he's great at entertaining people. I read a couple of his books when I was first learning about the market. I don't remember which ones, but I thought they were incredibly helpful. I think in another life he may have been a great teacher, because I think he has a talent for breaking things down simplistically. And again, he's been wrong plenty of times, we all have. So I get the criticism. But I think his show is good, I think his audience, there's a lot of inexperienced investors and traders in his audience and I think he helps educate them. And I'm all for education in any respect.

Allen: I think part of it is his, he's set up for failure in a sense with his show. They want quick answers, if someone calls you up and says, "Okay Citi Bank, what do I do?" And if your only choices are buy or sell, you're probably going to be wrong. You can't go into a long term explanation and say, "Well they have this and this going on, so don't buy right, now wait for this to happen then you can buy, or sell if this happens", he doesn't get that chance to do that.

Wayne: And I feel like I would not want to make 25 stock picks a day and be expected to get all 25 correct every day. That's pretty crazy, so I agree he's got a tough gig. But I daresay he gets paid very handsomely for it, so I can only have so much sympathy for him.

Allen: So Wayne, what do you have going on right now for you? What's exciting you, what's happening in the future?

Wayne: I am actually really enjoying life. That's probably lame to say. But I'm really happy with where I'm at right now. I've been telling myself at some point I want to write another book in the future, because I think it's been eight or nine years since I wrote my first one. But like I said I've got a full slate, I'm a staff writer for benzinga.com, those guys there are all really great to work with, I'm a regular contributor for US News and World Report, which again, my editor's awesome, the team there is awesome, and I've been contributing to Investor Place, and once again no complaints. They all treat me well and when I started out to write that book, it was hobby. Investing was a hobby for me, the stock market was a hobby. And I had no plans on being a professional journalist or writer or anything else. So I feel lucky every day that I'm one of the few people that was somehow able to finagle my way into having my hobby be my career at least for as long as it lasts. So, I'm just trying to enjoy myself and yeah, I'm having a blast. I have a blast every day. I wake up and get to write about the market.

Allen: Do you go to the office, or you work from home?

Wayne: I work from home, one of the many things I love about my situation. I live in Tampa Florida, and I can some afternoons if I'm not on a deadline, I sneak out and write by the swimming pool in the beautiful weather. So in terms of what I got going on, I don't really have any major plans in terms of projects or anything I'm working on, I'm just enjoying life.

Allen: That's sweet. So if our listeners want to get a hold of you or ask you some questions, where can they reach you?

Wayne: Well I have a blog, it's tradingcommonsense.com. And you can contact me through the blog, I try to be pretty good about getting back to people if you're patient for a day or two. My book is on Amazon, "Beating Wall Street with Common Sense". If you read it an it helps you or you were entertained or both, I'd love it if you drop me a review. I think it's only like two dollars or something, the book at this point. I just really want to get the message out there and yeah. I'm on US News and World Report, Benzinga, and Investor Place.

Allen: Awesome. Then your website is tradingcommonsense.com?

Wayne: Yep.

Allen: Awesome, I appreciate you taking the time and it was informative to get behind the scenes with a real journalist and see how you guys think and how we should actually use that information. As well as common sense. So thank you so much.

Wayne: I appreciate you having me on, it was good talking to you.

Allen: Thank you Wayne.

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
  3. WATCH THIS FREE TRAINING: https://passivetrading.com
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Jul 19 2019

28mins

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Rank #19: How to Know If You Will Succeed As a Trader - 010

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--  

Hey there, Genius Nation. How is everybody doing today? I am excited about this particular episode because I am going to share something that took me several years to figure out. Basically, what I want to share with you is how to know if a individual trader or investor is going to succeed or not. Because let's face it, everybody wants to be a trader, everybody wants to be an investor, but not everybody is cut out for it, not everybody has the ability or the stamina or whatever you want to call it. Everybody doesn't do it. Everybody doesn't succeed. Now, I don't know why, well, maybe I'll tell you why, but I don't know the exact reason why everybody doesn't have this particular trait that I'm going to be talking about today.

It seems to be something that should be there, but until you realize what it is, until either you figure it out on your own or somebody actually shares it with you like I am about to do today, a lot of people don't get it. They don't wrap their head around it, and so for that reason, I think that they give up. It's a shame because I think that when it comes to our finances, people just don't want to take responsibility, but you are not like that, and that's why you are on this podcast and that's why you're here listening, so let's get to it.

Now over the years, I have had the privilege to work with tens of thousands of investors. We've dealt with people on the phone, we've dealt with people in coaching, dealt with people in our membership site, dealt with people on email and maybe even met several people at live events. And most people come to us not knowing much about options and passive training or selling options. They don't know about it, they want to learn, they're excited about it, they're amazed at all the benefits. They're amazed at how simple it is to get started.

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
  3. WATCH THIS FREE TRAINING: https://passivetrading.com
  4. JOIN OUR PRIVATE FACEBOOK GROUP: https://optiongenius.com/alliance

Like our show? Please leave us a review here - even one sentence helps.  

Dec 11 2017

25mins

Play

Rank #20: Lean In - 36

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Genius nation, it's time for you to lean in.

That's right. I said it's time for you to lean in. Recently I was interviewed on the Live Your Passion podcast. It was a lot of fun. It was fun we talked about a couple of things especially about how I live my passion and how I discovered my passion and all that. But when I was telling my story and I was doing the interview, I shared that when I got started in trading I had a really, really rough time.

Why do most traders lose money?

Because they are stupid? Lazy? Nope.

In this episode I reveal why most traders lose money and why you will too if you do not make this one small shift in your thinking and your trading.

This is an exciting episode with a lot to learn from...

Resources:

Book: Think and Grow Rich

Podcast: Live Your Passion Podcast

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
  3. WATCH THIS FREE TRAINING: https://passivetrading.com
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Dec 29 2018

15mins

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The Importance of Having a Watchlist - 78

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Greetings Passive Ttraders. Welcome to another edition of The Option Genius podcast. In today's edition or episode, I wanted to talk to you about watch lists and the importance of having a watch list. Now, the importance, even though I do preach about having a watch list and sticking to your watch list and trading the items on your watch list. There are times when I invariably will not listen to my own advice and then go ahead and start trading companies and instruments that I have no idea about, never heard of before. And so I was reminded of this recently, when I was doing a bonus for the Passive Trader book. For those of you who don't know, the Passive Trading book is out and it is available, you can get on Amazon for, I think it's like $20 or $25, or you can go to our website, which is passivetrading.com/freebook. And you can get the printed version actually for free.

We've already paid for it. We have a limited supply of copies. All we ask is that you pay for the shipping and handling. If you do that, we'll send you out a book for free. But when we were coming out with the book and this whole little offer, we wanted to go a little bit further and created several products, or I guess they're called products. But they are things that can help you get faster results in your passive trading. So if you don't know anything about passive trading, if you've never traded before or if you want just more information, get the book. If you want to go faster, maybe you already know a little bit about it. Maybe you already know about how to trade, but you want better results. That's where these other extras come into play.

And so one of the things that we created is a crash course. And so once you buy the book, the next page that it takes you to is an offer. It's an offer page and it's a video of me and it tells you about the crash course. And basically the crash course is after I already written the book we went through and I took notes on the entire book and I turned it into a video format where I went deeper into the elements that I thought were the most important. So now everything in the book is important and we've already taken out... It was a lot longer before. It was maybe double or triple the size before. And we had to cut it down to make it manageable because I didn't want to have like a 500 page book. But there were some aspects that I wanted to go in deeper and I could do it better in a visual format.

So that's why we made a video course. It's a crash course. The average person to read a book of this size of passive trading would take about 10 hours. That's the average person to read it. And now this is a more detailed book. So there are numbers and there's things that you have to understand. You might have to read it back a couple of times to really get the gist of it. And so it probably take even longer than 10 hours. So what I wanted to do is a crash course just focused on the most important things. Boom, get it done with in like an hour or so, a couple of hours. I'm not sure how long the video is. I don't know. I think we broke it down into several. So I don't know exactly what the length of the video is, but it's really, really good. And I'm really happy. I'm really proud of it. So that is something you might want to pick up.

But in addition to the crash course, what we offer as part of that package is videos of actual trades. So now in the book, I do cover several trades that I've made in the past. So you can see how each trade goes, by strategy, by strategy and see how they actually work out. But that's on paper, right? Visually you can do a lot better. So what I did was I picked, two trades that I've done in the past for each of the three strategies. So six trades total. And I went into backtesting software and visually I did a screen capture of my screen. And I went through how I put the trade on, what it looks like on the screen. What does the graph look like, how it works. And day by day recorded what happened.

Now this was with the backtesting software, you can go back in time. So let's say there was a trade that I did three months ago. I can go back three months ago, show you the graph of the stock, the chart of the stock and say, look, this is what the stock was doing. This is what I saw the day that I put the trade on. And then this is what happened the next day. And this is what happened the next day. And then the next day this happened, so I did this. So day by day, you can actually go back and see and say, hey what is Allen looking at? How is he placing this trade? How is he managing this trade? And so I did it for all the three strategies that we talk about in the book.

There are six trades in total, and I thought that... If you've never traded before, if you don't understand or if you want to get some behind the scenes kind of information and knowledge, you got to watch those videos. Because you can see me day by day going through the trades. So if you don't understand how these trades work, you want a better idea, watch the trades. And it's a visual interpretation. It's visually, day by day. Even when you're doing live trading, you can't get that because nobody has the time to sit there and go day by day by day. Even for people of our option genius membership, right? They get the trades and that's about it. We don't show them day by day how it's going through. So this is really, really important in that sense. So if that's important to you pick that up, it's on the page right after the book. So you buy the book and then the next page, you get this offer.

Now, why am I telling you all this? Is it because I just want to sell it to? Well I want you to get it because I think it's going to help you. But while I was doing those trades, while I was looking for several of these trades, I came across one and I didn't want to find like the easiest trades. I wanted to find where there were some issues sometimes, like okay the trade went against me, how did I fix it? What did I do? And so I wanted to give a real sense of what these trades are actually like. And so I found one trade that I started about a year ago. It was in August of 2019. And I just exited this trade about a week ago or two weeks ago, whenever expiration was.

This trade was on a stock that was not on my watch list. The company was Royal Gold, R G L D. Never heard of this company before, don't even know what they do. I still don't know what they do. I was in the trade. I own the stock for this company for close to a year. And I still don't know what they do. They might be a miner. They might be a jewelry wholesaler or they might be a retailer. I have no clue. I don't know what they do, but it has something to do with gold. Now how did I get into this stock? And why am I being so clueless about it? Well, like I said, it's not on my watch list. And so that is part of the problem. About a year ago, a friend of mine told me that there's a pattern in gold. And depending on when you're listening to this, the pattern just might help you to make some money.

The pattern is that gold rallies into the end of the year. And so the idea was that it's about August, 2019. This is when he told me and he's like, "hey you know, I'm doing this trade. It's a covered call in the mining on this company, Royal Gold." And he told me what it was. I looked at it, I analyzed it. And I said, "Hey, this is good. I like this." The chart looks good. The stock is going up. And if gold rallies to the end of the year, then there's a very good chance that this trade is going to make some money. But I don't know this company. And I don't think they pay a dividend. So I want to put on the trade, but I don't want to be in the trade for a long time. I don't want to own the stock for a long time.

So that's why it was set up as a in the money covered call. And in the money covered call is where the stock is trading at a certain price. Like I was saying, it's a hundred, you buy the shares at a hundred, and then you sell lower than the price. So you sell your call option lower than the price, which was I think it was selling at like a 4 or 5% below where the stock was. So that is the trade that I did. And I don't have in front of me. But the trade was going to make somewhere around 11%. Or I believe that's what it was. It had the ability to make 11% in about a month's time, just the way it was set up. And it had a very, very high probability of profit.

Not only that, but I looked at the chart, the stock was going up. Gold is supposed to continue to go up. So that means the chart... This company Royal Gold should also continue to go up. And so if that happens, that's great. That's what I want because I want the stock that I bought to be called away. And I want that money to just be left. And I didn't want to do it, I didn't want to mess with it. It's a simple, easy trade. You don't have to manage it. You don't have to [inaudible 00:09:41] it. You don't have to do anything. You put the trade on, you wait till expiration day and you see, hey what happened with this trade? Most likely the stock is going to keep going up and I'm going to be assigned in my exercise. And my call option is going to force me to sell my stock, which I wanted to do anyway. And I was going to keep the gain. That was the plan.

Now, as I already told you, I was in the trade for about a year. So it didn't exactly go according to plan. Instead of the stock continuing go up. The stock went down and then it kept going down. And so my option expired, which was good because I made some money. But now I'm sitting on a loss on the stock, which I don't even want. So now the idea is, okay what do I do now? Do I keep it? Or do I get out and take a loss? Well, I don't like taking a loss, who likes taking a loss. I don't like taking a loss. And who knows gold might also appreciate again. It might keep going up. Maybe this is a short time drop or something, who knows.

And so I sold more calls, hoping that the stock would go up and I would be called away, that didn't happen. Sold more calls, expired, sold more calls, expired, sold more calls. And I go through month by month, day by day in the trade in the video. So if you want to pick that up, you can go through and see exactly how it happened and which calls I sold and why I picked those calls, all that. But in the end, it took me about a year to get out of this trade. And after a year I made about 8%. I think it was an 8% gain on this trade. So what should have been a one month trade where I could make 11% turned into a whole year problem, where I had to keep selling calls in order to make 8% for the year.

Now 8% in a year is nothing to laugh at. That's a really good return. And that's what the stock market averages, 8% percent a year. So I did that and I took a trade where the stock went down. The stock was down and I still made 8%. So that's one thing to take away. Like, oh wow, how do you make money on a stock that's going down? Well, this is the way to do it. The other thing I want to point out, which is probably more important is that I never should have been in the trade in the first place. Now yes, we're going to place trades and we're going to miss and we're going to mess up, we're going to lose money on trades. That's normal. And then you have to know how to fix it. Fine. I get that.

But I had no clue what was going on with this company. Didn't do any research into it. Don't know the company. I still have not looked into it. I still don't know what they do. And so that's not very smart. And that's exactly why I keep telling you to have a watch list. When you have a watch list... A watch list for those you don't know is a list of companies that you monitor, that you watch. And those are the ones that you trade. Now if you don't know how to make a watch list, we cover it in detail in passive trading, in the book. And then even in the passive trading formula, the course, we spent a lot of time on that in the course. And there are over a dozen different criteria to use, to pick the best stocks, underlying ETFs, indexes, all that to put on your watch list.

And everybody's watch list is going to be different, unique, because you like trading some things. I like trading different things. We'll make different watch lists. No problem. That's not a big deal. The thing is when you don't stick to the watch list, you make mistakes like this one. And even though at the end of the year, I came out ahead, it was a lot of extra effort that I didn't really need to make. If I had stuck to my watch list, I wouldn't have had that problem. If I had wanted to play gold. And that was the plan. Gold was going up. I should have just played gold and gold is on my watch list. So I watch gold. I watch the chart of gold. I see how it's doing. I know how it behaves. This company didn't behave the same as gold. Gold kept going up, but this company went down and I couldn't figure out why.

So the point again, I'm trying to make here is create your watch list. Stick to the watch list. There was another time and I tell this story many times where I traded a stock that wasn't on my watch list. And at that time it was Las Vegas Sands. And I did some cover calls on that one too. And the stock dropped all the way down to $2. And I had no clue why the stock was dropping because I didn't do my research because it wasn't on my watch list. I didn't know that the company was about to go out of business. They were going to declare bankruptcy. That was why the stock went all the way down to $2. Now, luckily for me the stock did not declare bankruptcy and then they recovered and I made all my money back and a lot more. But that's just another way that I lucky. There's no other way to say it. I should have lost all my money on that trade because I didn't do my homework and I didn't stick to my watch list.

So even as a professional trader, I keep having to learn the same lessons over and over and over again. And that's normal. That's not a big deal. It happens, but I want you to learn from my mistakes. And so I don't want you to feel bad if you make mistakes. I don't want you to feel bad if you make the same mistake over and over again. But we need to get better at it. We need to keep improving. And that's the only way to do it by just getting reminded of it and saying, hey this for me was a great reminder. Like, Oh my God, geez I can't believe I did this again. But I did. And I learned how to fix it. And I did. Luckily I was able to do it. So now I have another reminder of, hey I need to focus on the watch list. Focus on the watch list. Focus on the watch list.

I had a couple other trades that came up recently that somebody shared in our group, our Facebook group for members of the Passive Trading Formula. And I wanted to take them, but they were on stocks that I didn't really watch. And so I was like, oh no I can't. Okay, no I'm not going to do it. And then I went and found similar trades, similar strategy to stocks that I already own or stuff that are on my watch list. So I was happy. So I still made money. It's not like you can't make money by only sticking to your watch list, but you're going to make more money because you're sticking to things that you know. So that is in a sense, the gist of this episode. Basically I could have broken down and said, "Hey yeah, just got to, you got to stick to your watch list.

But it makes a bigger impact when you hear the story behind it I think. As people, we love stories. We love hearing stories. And when you tell a story, it not only does it stick in your brain and you remember it more, but it shows the importance. Now, luckily I didn't lose any money on this. But if I did, it would have been a very expensive story. And then I would have been like, hey I lost X dollars doing this. I don't want you to lose X dollars. Don't do the same thing. So with that said, thank you for joining me for another edition. Again, the book is Passive Trading. It's out now, limited quantities are available for free. Go check it out. passivetrading.com/freebook.

And if you have any questions, you can always email me help@optiongenius.com. If you need anything, we're always here for you. Join us in our free Facebook group, which is called the Alliance, Option Traders Alliance. You can get that at optiongenius.com/alliance. I believe that is the URL. If not just email us and we will get you the name and the URL to that. So you can join us in there, get the book, learn passive trading, start making money. And even on a stock that goes down, I still made 8%. So learn how to do that. Make all your troubles go away. Take care and trade with the odds in your favor.

Aug 02 2020

15mins

Play

Trading Scars - 77

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Ho, ho, ho, passive traders. It's Christmas in July, or whenever you are listening to this. Why? Because I have a gift for you. After over two years ... Two and a half, three years? I don't know how long it took, but it took a long time, well over two years. I finished my Passive Trading book. It has been published. It has been printed. It's on sale at Amazon. You can go pick it up right now for $20. Or I do have some copies that I want you to have for free. I want to give them to you. I want everybody to have this book.

I'm doing my part by giving them away, a limited number that I have that we got as part of the first run. All you have to do is go to passivetrading.com/freebook and you have all the details there. It is a printed book. We do have to ship it to you, so it will take a couple of days to get to you. It is passivetrading.com\freebook.

Now, the book is free. I will need you to cover the shipping and handling costs, if you don't mind that. And you'll get the free book in your mail very soon. People have been asking about the audio book or the ebook version. Those are also available there for a little bit extra. But if you get the free book, you can get those as well.

If you're ready to get started trading options, or investing the right way, or making some extra money on the side, you got to get this book. I mean, I call it Passive Trading: How to Make Consistent Money From the Stock Market in Just a Few Hours a Day for a reason, because that's what it is. And it delivers. It's been on Amazon for a couple weeks now. We already have well over a dozen positive five star reviews. Everybody else that's read it has loved it. We're getting some video testimonials in that we're adding to the website, too. So, I just can't wait. I'm really excited. I think this is going to really make a big deal. So again, passivetrading.com/freebook. I don't know how long the books are going to last. And if you want one, please go get one. Pick it up right now. Just pay for shipping. We'll send it out to you.

Another announcement is that this show has been rated as one of the top trading podcasts! So we are super excited at that as well.

Top Trading Podcast

Trading scars. That's the type of this episode. What do you mean, Alan, by trading scars? What is a trading scar? Ooh, sounds dangerous. Well, when it comes to trading, we all lose money. There's nothing we can do about that. It happens on a regular basis, right? It's one of the things that happens. Like when you're playing football, you're going to get hurt. When you're trading, you're going to lose money. You're going to have a losing trade. Okay. Got it. Check.

But then, when it happens a lot, or when it happens unexpectedly, or when the loss is especially large, it can leave a scar. It can hurt. It can go deep. That cut can go very deep, and it's really hard to get rid of. It's hard to get over. I mean, it's not a physical scar, right? It's a mental scar. It's something that affects our psyche. And for some people, that affects them all the way down to their core. That's a scar, though, that nobody else can see. You're walking down the street, nobody knows you've lost money in the stock market. You could see it and you can feel it, but nobody else can.

And sure, there will be some people around you when you get your scar that will know that you got your scar, your family, your spouse, your kids, whatever, your friends if you tell them. They're going to see it. They're going to know you got it. But then, they're going to move on. You are going to carry that scar for a long time, and hopefully the scar will fade away. For some people, it doesn't.

Losing a lot of money can be very painful. And that's what causes the scar, because we put a really, really big attachment to money. And we put a really, really big attachment to winning, and to being successful, and not failing. But normally, failing at something is a good thing. It's great sometimes. It might not feel like it at the time when you fail, but that is how we learn. When I'm teaching my kids, my eight-year-old, he gets really mad every time he gets something wrong. He just like, "I can't do it, Daddy. I can't do it." It's like, "Yes, you can. You got the answer wrong. It's okay. That's why we're learning. We're learning that what we did didn't work, so now we have to try a different way. We can't just give up. We've got to keep going. We got to move forward."

So as you progress on your trading journey, you're going to build up these scars. Doesn't mean it's not going to hurt, but it's part of the game. You play the game, you're going to get hurt, and they're going to be scars as a history, as a memory, as a feeling that, hey, this happened. Don't forget.

Now, the saddest thing is when a scar impacts a trader so deeply that they give up. Or even worse, they lose confidence in themselves. They change. Their personality changes. The way they feel about themselves, the way they think about themselves, the way they see themselves changes.

And when I was learning how to trade, I met a fellow, a fellow trader, who was light years ahead of me. I mean, this guy was awesome. He was brilliant. I mean, he knew everything. He knew all the jargon. He knew all the trades. He was doing all these exotic strategies, and I couldn't even figure them out what he was doing. I had no clue what he was doing. He would explain stuff, and I'd be like, What?" It was like a two-year-old talking to a college student. That's what I was. Some of the things that he taught me I still don't understand. He was that brilliant.

But, then he got cocky. He got arrogant. He didn't take precautions, and he screwed up. And It wasn't just a little, tiny screw up. It wasn't like, "Oh, yeah, he had a bad losing year. He lost when he should've won." No. He blew up big time, and he lost it all. Total account blow out. Zero. Gone. Lost all of his money.

But then, more importantly than that, he lost his confidence. And because of that, every attempt that he made to build his account back up failed. He just couldn't get that winning touch again. Didn't matter what he knew, didn't matter how much experience he had, he couldn't get the winning touch back. He couldn't get back on his feet. That caused him to be depressed.

He looked at himself as a trader. That was his identity. But, he was no longer a successful trader. Now he was just an average, or below average, or loser trader because he wasn't making any money. So, he went into a cycle of self-destruction. He started doing crazy things. He started using and abusing. Eventually, he ended up in rehab. Thankfully, he got out, and he's better now. But, that scar hurt deep.

Recently, he reached out to me, and we got to talk. He's a great guy. He's trying to get back into trading now, and he is looking for somebody to stake him. Basically, what that means is he's looking for someone to give him the money to trade so that he can split the profits with them. It's kind of like a hedge fund, but the person who puts up the money gets more of the profits.

Now, as a rule, I don't do that. But when I was talking to him, I realized that I was talking to somebody different than who I knew before. He wasn't the same person. He used to be full of energy, and charisma, and super charming. Now he's just boring, blah, no energy, no confidence. If he was the same as before, most likely he probably would have talked me into giving him some money. That's how powerful he was before. Even if I didn't want to, he'd probably talk me into it.

But, his scars were still there, and they were limiting his confidence. They were limiting what he was asking for. He never even asked me. That's how scared he was. Before, he had no problems being brash and cocky. But now, he was bringing up ... He's like, "Oh, hey, I'm looking for somebody that can stake me. Do you know anybody? I'm doing really well? I got some records and dah, dah, dah. I got this new strategy I've come up with that's working really well. Blah, blah, blah." And I'm like, "Oh, good luck to you." He never even asked me to stake him once, even though I knew that is exactly why he called me. But, he didn't have the confidence to ask for the sale to go for it.

But, that's my point. He was never able to overcome the scar. The thing is that only he could see it. I had forgotten about it. I had forgotten that he blew up. I remember that he was in rehab. That's the thing I remembered. But because the scar was there, and he knew about it, and he thought it was there, he acted differently. Maybe he thought that I still remembered what happened or maybe he thought that I cared. To be honest, what bothered me more was that he spiraled out of control. That was the concern to me when I was thinking about, "Hey, should I stake this guy or not?" Even though he hasn't asked me, I was thinking about it because I knew how good he was in the past.

But, my concern was not that he blew up. I didn't even remember that. My concern was that I remember that he spiraled out of control. And to me, that was a bigger issue of not giving him money.

I felt bad about it, that he's spiraled out of control, but not that he lost money. Because hey, everybody screws up. Everybody loses money, Some people more than others, some people bigger than others, right? Go big or go home. He went big, and he had to go home. So, I guess he did pay. He did both. But, we all get the chance to get back in.

And that's what I love about trading. You always have the chance to get back in. You lose a bunch of money, you learn from it. See what you did wrong. Save up more money. Get back in the ring. It's not rocket science. You can figure it out. Just got to get back in the ring. That's the wonderful thing about trading. The only limitations are the ones that we set for ourselves. The only thing holding us back is ourselves and in our brain. Physically, it doesn't matter. There's nothing physically stopping you from trading. There is no discrimination in trading. There are no limitations. Doesn't matter who you are, what race, what nationality, what gender, what political party, where you live. None of that matters, how much you make, where you went to school, or even if you went to school. Nobody cares. If you have any learning disabilities or handicaps, no. You can still do this. Trading is just trading. It's open to everybody. And you can screw up as much as you want, too. You can blow up your account a hundred times, and you can still get back in the ring.

They're not going to stop you. In fact, they're going to encourage you because they want to take your money.

I was thinking about this episode. I realized that I have scars that I have not overcome either. It's not easy. Now, personally, I refuse to trade for anybody else. I don't want the headache, at least that's what I tell myself. People in the past, friend ... Just recently, somebody came up to me, a partner in another business. He goes, "Hey, why don't we just take the income out of this business? We got some money sitting in that business." He said, "Why don't we just take it out, give it to you, and you trade it?" And I said, "No, I don't trade for other people. Sorry. I don't want the headache."

Is it really about the headache? I mean, it's just one more account. I have plenty accounts. We can even probably have it mirror one of my other accounts. So whatever I do in one account automatically happens in the other one. I wouldn't have to do anything. It wouldn't be a headache at all.

I think the real reason I say no is that scar. I can lose money for myself. If I lose money, I'm going to be okay. I can sleep. I can deal with it. But if I lose money for somebody else, if I lose somebody else's money, I won't be able to sleep at night. That's the wrong way to think about it. If I think like that, then for sure I'm going to lose their money. If I go in in advance thinking, "Oh my God, I'm going to lose him money.

How am I going to lose? What am I going to do? Oh, no. I'm going to lose." I'm going to go in thinking about the worst outcome. That's what's going to happen.

If I did not have a scar, I probably would be a lot more boastful telling everybody that I could trade for them. And who knows, I would probably have my own fund making a lot more money than I am now by trading for other people. So if that's the route I wanted to take, I could have. But right now, that route is not open for me because mentally I am not able to do that, and I think it's because of my scar. It's because of when I lost money when I was starting out.

I had a big, big letdown when I first started. Now, I've never traded money for anybody else, so I don't have that particular scar. But when I was trading for myself, I lost a big amount, and I knew exactly how it felt. I don't think I've ever recovered from that particular scar.

So although at this day in my life, at this stage, I don't want to trade for other people. I don't need to. I don't need the extra return, the cash. I still need to work on dealing with the scar, though. That's besides the point. Even though the thing is there, the ability I can trade for other people, but I don't want to. I don't need to anymore. Earlier, a few years ago, yeah, the money would have been really nice.

Doing the same trades I'm already doing for myself, doing it for other people, the income from that, the percentage of the profits from that would have been really nice because you can ... If you have a $50,000 account, you can only make so much money. Even if you double it, you're only making 50,000. But if you've got somebody with a million dollar account that you're trading, and you double that million dollars to 2 million, and you get 20% of that, that's 200,000 compared to the 50 that I made for myself. And I could do both at the same time. So yeah, if you're trading for other people, you can make a lot more money a lot faster. But, I couldn't. I never got my mind around it. Does that make sense? Because of the scar.

And it's funny. Because lately, I have been seeing people post on Facebook about how they have trades that have made 100, 200, 5% gains. That's great for them. 500%, that's amazing. I'm happy for them. But, then they start giving advice, and they start posting about how wonderful they are. The thing is, those people, they don't have any scars yet, but they're coming. Believe me, the scars are coming. So if you're sitting there and this is your first crack at trading and you're making a 100, 200% on the trade, hey, wonderful for you, but be careful you don't give it back, because you're going to give it back. And the scar, you're going to get your scar. It's like a badge of honor. How many scars do you have?

Every time we have a huge run up in the markets, we always have these types of fools. I say fool in a endearing way. I'm not trying to put you down if this is happening to you. I'm just telling you, you don't know what you don't know. But, that's what they are. They're still fools, and they're going to get schooled by the markets.

Now in 1999, before the .com crash, 1999, everything, all the stalks were running away. Tech, Nasdaq, QQQ, every day, 10, 15, 20% higher. There were a lot of fools because everybody was making money in tech stocks. Everybody was making money in tech stocks. Doesn't matter what you know, what you don't know. You can make money. Just buy it. It going to go up. There was a guy I remember. We used to see him a lot. He was my father's friend. He kept telling my dad, every time he would see him, tell, "Hey, man, you're not invested yet? Man, you got to buy these stalks, man. I just bought AOL." That was his favorite one, AOL. "Oh, man, I just made this much money on AOL. Oh, I just made this much money." Every time we would see him, "Man, why haven't you bought yet? Why haven't you bought yet?" It was great to see him so excited, and happy, and making money. And at that time, we didn't have two nickels to rub together, so it's not like we were going to be investing. But, it sure felt like, man, if we could even borrow the money and put some money into these stocks, man, we could make a lot of money just like this guy.

Then, there was the crash. Then, I have never heard that man speak of stocks ever again. I see him. At that time, we used to live in Miami. Now we live in Houston. His family have moved to Houston as well, and we see him from time to time. Never mentioned stocks ever, ever again. His scar's just too deep. In 2017, when Bitcoin got to $20,000 each, there were fools tripping all over themselves trying to prove which one of them was the bigger fool. You probably remember this. Every party you would go to, whether it was a wedding, a birthday party, a get-together, a picnic, whatever, a barbecue, whatever it was, all the guys were standing by themselves talking about Bitcoin and the women are on the other side talking about something else. It was crazy.

There was one night, one day, we went from a kid's birthday party to a picnic thing to a dinner at night. And at all three parties, the only thing all the guys were talking about was a Bitcoin. That's it? Bitcoin. Bitcoin. Bitcoin. Bitcoin. How many do you own? How many do you own? What'd you do? Oh, I got this coin. Oh, I bought this coin. That's all it was. Greater fools.

There was a fellow who they did a news report on. He had a wife with three kids, three young children all under the age of 10. These guys were so fooled up into Bitcoin they sold everything they owned. They sold their house. They sold their cars. They sold all their possessions.

They took all of their savings, everything they owned. They bought Bitcoin, and they were living in a tent. Literally. They had a laptop, and they were doing an interview on TV from the laptop, and they were being interviewed on the laptop. They lived in a tent on a beach somewhere. I don't know. It was a national park or I don't know where they were. But, they literally lived in the tent. They sold everything to buy Bitcoin.

Now, Bitcoin, who knows what's going to happen with it. But I would say, yes, that fellow was a fool and his wife was a fool. And because of them, the kids are suffering. I don't know whatever happened to them, but I can bet you that that guy has a scar bigger than his body. I hope not. I hope he realized his error, got over it, and got back to work and became normal, and realized that, hey, I still need to keep working. I need to have a roof over my head and food for my kids to eat. I can't just put everything I have in Bitcoin. Hopefully he won't make that mistake again. But, what these fools, not only him but all the other fools, what they don't understand is that everything runs in cycles. Good times, they're here for a while. Then, bad times come, and they're here for a while. Then, good times come back. You just have to know that the cycle will change. And it's like that in everything. I've talked about it earlier another podcast where I like to call it waves. The waves, you get a high. You get a low tide. Then, you get a high tide, and you get a low tide. It's just waves. The waves keep coming. This too shall pass. If you're dealing with something bad right now in your life, this too will pass. If you're dealing with ... If you're on top of the world right now, well, be careful because bad times are coming.

My wife, uncle. She's got an uncle. A couple of years ago, he got into trading. He didn't want to tell me about it for some reason. Okay. No worries. He would talk to my wife, though. They chatted on the phone every day. He would be calling her. He'd be telling her what he was doing, the trades he made, how much money he made, all that stuff because she was interested. I mean, he's her favorite uncle, and she loved to talk about it. I had taught her enough about trading so she understood. He didn't have anybody else to talk trading with, so he would call her up.

One day, the calls just stopped. No reason. No rhyme. None. Just call just stopped, and she didn't even notice. Much later, we found out that he lost the entire amount. He blew up. Big fights in the family, husband and wife, killing each other, screaming each other. I mean, when you lose money, it's not just your money. It's also the family money. And if you have a spouse and there's a fight, that could be a big scar right there. The more emotion you put on something, the deeper the scar. So, losing money is one thing. How you feel about it, how other people make you feel about it, how you make other people feel about it, that increases the intensity of the scar.

But just last month, when we got together with this uncle again, he mentioned he's back trading. He's up $40,000 so far in 2020. So in the first half of the year, he's already up $40,000. Now, he doesn't have a lot of money to play with, so I'm assuming he's up at least 100% or more. And now his son who's just out of college, he's trading, too. He told me he's bought a lot of airlines, and cruise stocks, and all of these go-go bet names, gambler, speculator names. And I think I've seen this movie before. Hopefully uncle learned his lesson last time and he doesn't make the same mistakes, but I have a feeling that history's going to repeat itself.

So if you have a losing trade, good. Get used to it. More are coming. Learn from them. Learn how to deal with the scars so they don't faze you. And as the kid say, scars are sexy. Chicks dig scars, dude. It means you do stuff. It means you take chances, that you live. You're alive.

So, don't let the scar ruin things for you. Realize that you have the scar. Find out what you did wrong, focus on what you did right while avoiding your mistakes. Eventually, the scars will become a memory and fade away, at least that's what I hope for you. Trade with the odds in my favor, folks. Take care.

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Jul 22 2020

21mins

Play

My 4 Year Old Is Already A Millionaire - 76

Podcast cover
Read more

People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Hello, passive traders. This is Allen coming to you with another episode of the Option Genius Podcast. Today, I am a proud papa. Not because of something my kids did, but something I did for them. See, what I've already done is, I hope to be, something that will set them up for a very cushy retirement, or a very happy life. Let me tell you what that is.

Now, I have three children, nine-year-old boy, another eight-year-old boy, and then a four-year-old daughter. And I don't want to happen to them what happened to me. See when I graduated high school, things financially were not really good for our family. And I was the only child, so going to college was kind of a no-brainer, you were just going to go. And my kids, they're going to go. They don't have choice, they're going. With all the high competition for the job market and everything, you just need to go and you need to learn and get out there and be on your own.

And so, when it was time for me to go to college, I applied for several schools. I got into some private schools, but they did not offer me the financial aid package that I needed to go there because basically I needed them to pay for everything. The one school that did though was Florida State. And Florida State gave me a financial aid package where, I believe at the time I do not remember exactly, but I believe it was costing somewhere around $8,000 a year to go there, that included room and board, for two semesters. And they were giving me $9,000 as part of the package. Now, part of that, a couple thousand, that was loan under my name, but still they were actually giving me more money than I needed to go there. So I was going to have everything paid for, and I was going to have a little bit of cash in my hand, in the bank, so that I could spend it on candy or trips or to the beach or whatever. So, that was my only option. Now I'm going to Florida State.

Wasn't my first choice and I did not enjoy it there. Nothing against the school, it just, for me emotionally, mentally, I was just not in the right frame of mind to enjoy it and take advantage of it, which I do regret to this day. But, I wasn't there very long because, at the end of the first year I had to drop out and come back home. My dad had just started a new business that he had no knowledge of how to run because it was all computerized, and so he'd basically told me I needed to stay home and work with him in the business, which is what I did. Okay. No worries. I'm not bitter about it, that much.

But the point was that we did not have the money for me to afford the schools that I wanted to really go to. And if I had gone to one of the schools that I actually got into, things would have been way different in my life. Now, I'm not complaining because I love my life, so everything I guess happened for the best. But for my children, I would like them to be able to go to the best school that they get into, whichever school they want to go to. Whether it be around the block or across the country. I don't want finances or money or lack of money to be the reason why they don't go to the best school and get the best education that is possible.

And so, I don't know what school they're going to go to, but my oldest he asked me one day, he goes, "Hey dad, what's the best school in the country? What's the best college in the country?" I'm like, "Well, probably Harvard." He goes, "Okay, then I want to go to Harvard." And that was it. Since then, anybody asks him, "Hey, where are you going to go to college?" He goes, "Harvard." He's like, it's no big deal. He doesn't know how competitive it is. "Hey, I'm going to Harvard." I love that confidence in him. I told him, "It's going to be hard." He goes, "Yeah, no problem." That's a nine-year-old. Awesome. I love it.

So as dad, as the finance guy in the family, my wife doesn't really worry about the finances, I do, so I need to figure out how we're going to pay for Harvard. Which when he gets there, it's probably going to be, I don't know, $300,000 a year? And plus now, I have three of them. So, you know it's going to be close to a million dollars that I'm going to be paying for college. So how am I going to do that? Geez, that's a lot of money.

 I started looking into college savings plans. What are the different options out there? You got the 529, you got the Coverdell, you got some other stuff. Doing my research, and I came to the conclusion that, I think that the best thing that I could do for them is to open up Roth IRAs. Now that might be sounding a little weird, right? A Roth IRA for a kid? How do you do that? They have to have income? Right. They have to. They do have to have income. They have to have a job. So that was an obstacle that we had to overcome. Okay, what job can we give them?

Well, lucky for me, my wife has another business, which is a daycare. And on the daycare, we have to have pictures of happy children on the website, in the marketing materials, the brochures, the pamphlets, that things we hand out. And so, why not instead of paying other kids for their pictures or stock pictures or whatever, why not we pay our own children? Take their pictures professionally, and have that in our marketing materials? So that is what we did. So, we had professional pictures taken. We do it every year, and we have those pictures as part of our marketing plan. And so the kids get paid for this.

Now, currently the tax law says that if your child is working for you or if your child was working anywhere really, they can get paid up to $12,000 a year without having to pay any income tax. Now, going to give you a disclaimer here, check with your accountant on this. Talk to your accountant, and talk to your tax professional, whatever, make sure this is correct. This is what I been told. And so you can do $12,000 a year without paying any income taxes. And, if you're earning money, you can put $6,000 a year into an IRA, whether it's a Roth or a regular IRA.

Now for them, obviously I chose the Roth IRA because they're not paying any taxes on the income anyway. And so the money is paid to them tax-free. It goes into the Roth IRA, and there's no tax there. And then later on, when it actually comes out, after they retire or whatever age, 65, they take the money out of, it should come out of their tax-free as well. So you kind of get like a triple whammy here. So I really love this idea. I think it's one of my better ideas I've ever had.

And so one of the ways that you can actually pay for college is that you can withdraw the money that you put in the IRA for college. In fact, if you look at the rules of how the Roth IRA works, any money that you put in, any deposit that you put in, you can withdraw that money at any time. So let's say you put $5,000 into it. You can take that $5,000 back. The gains, if that $5,000 goes to $6,000, you cannot take that extra $1,000 out. If you do, you have to be taxes and you have to pay fees. So that you don't want to, because you don't want to pay the fees and taxes until you can at whatever the age is, I believe it's 65, when you could start taking money out of your Roth IRA. Or 59 and a half or whatever the number is.

You find a way to get your child paid for work that they're actually doing. And in my case, they're models. If you have your own business, they could work in your business doing accounting, bookkeeping, maintenance, anything. And that money that they get paid, you don't have to pay income tax on it, and it goes straight into the Roth IRA. And then if you need to, and I'm hoping that I will not need to do this, because I'm also investing in 529s for the children, and I'm hoping that I'll be able to use the 529s and whatever money I have at that time to pay for it so we don't have to touch the IRA. But I'm investing in the IRA first. And then once I do that for all three of them, then I put money in 529s every year for two of the children.

So, I put about $5,000 each, for each child. So currently each child has $20,000 in their IRA. I've been doing it for four years. The accounts haven't really gone up very much in the last four years. They're going up, they went down, maybe I'm picking the wrong stocks. I don't know. But for whatever reason, they're roughly based on where they started. And even this year, we had a 35% bear market. It's still about the same.

Now, one thing I briefly mentioned earlier, you can take money out of an IRA that you deposited. So when it comes times to college, we're going to use the 529 funds first. Use up all that money, because that 529 can only be used for educational expenses. And that's why I only have two of them. So, the older kid, he's got his account. And the middle kid, the eight-year-old, he has his account. For the baby, I'm not putting in yet, just in case. I don't want to have too much money in the 529. Because if the three of them don't use it up, then we have to take it out and pay fees on that and all that stuff. So I don't want to bother with that. So I'm going to use the 529 money up first. Then my own money. And then if that's not there for whatever reason, then we'll tap into the IRAs and take money out of there. My hope is, we never have to, and this money just sits there and it grows and grows and grows until age 65.

Over the weekend, I got to thinking, I said, "You know, $20,000, that's a lot of money. I wonder how much it can going to be?" So I went to one of my favorite sites, investor.gov, and they have this wonderful, easy-to-use compound interest calculator, investment calculator, whatever you want to call it. And so, I wanted to see what their results would be. And I plugged up the numbers and I said, "All right. For my oldest, he's nine years old, he's got 50, what, 56 years left, until he's 65." So I typed it in, beginning balance $20,000. Monthly contribution, zero. If I don't put in another penny into his account, he's got $20,000 now. If he gets nothing, and since it's invested in the stock market, I think it's going to get about 8% average return for the year. If we don't invest any more money, if he only gets 8%, not more or less, but averages 8%, when he turns 65, he is going to have an account worth about $1.5 million. Without doing anything. The money's in there. It's been put away. It's just going to compound the way the stock market has been compounding for the last couple hundred years, and he should be worth $1.5 million at age 65.

And that blew me away. I was like, "Holy cow. That's awesome. My kid's a millionaire. He's nine years old. He's a millionaire. That's going to be, oh, I'm so happy." I'm so proud of for myself that I've been able to do this. So [inaudible] what about the four-year-old? She's going to have even more time to compound. So I added her numbers, and she's going to have over $2.1 million when she turns 65. $2.1 million. Oh my God, that's incredible. Never in my wildest dreams, did I think I would be able to do this for my kids.

And by that time, by the time they're 65, is another 60 years from now for her. 61 years from now, life expectancy is not going to be around 80-85 where it is now. It's probably going to be like 120-130 years. That's life expectancy at that time. So, she's just going to be getting to her mid-life crisis. She's got half her life ahead of her, and she's got over $2.1 million in the bank just sitting there that she can use. I hope these three kids, I hope they don't blow it on some fancy, flying sports car or something. Their fancy, flying Lamborghinis or whatever they're going to have at that time. That'd be insane if you waste it. But I'm so excited. I'm so happy.

And if I keep adding to the account as I plan to, the results are going to be much, much better. Who knows? For another few years, still add money in. Maybe it's $40,000 that I put in there. They could have close to 5, 8, $10 million. Jeez. And if I trade options for them, which I'm not doing now. Right now, I'm just putting it in certain stocks and ETFs. But if I trade options with them, the results are going to be even much better. Much, much better. But my plan is to use the accounts to teach them how to choose their own stocks and how to trade options on their own. So they're going to have their own net worth. They're going to not ever have that feeling of being poor. They're going to have money.

Now, I'm not sure of ... I'm going to have to structure it in a way that they don't get access to it right away. I'm going to have to talk to my attorney about that. Because I don't want them to become 18 years old and be like, "Oh, I got all this money in my IRA. I could just take it out and go blow it." Go get married to some girl and live it up in Vegas or something. I don't know. Hopefully that never happens, but we'll have to figure out a way that they don't access it like that.

But the plan is to teach them how to use this money so that they can trade for themselves, and then that way they never have to work for money. They can go to college, whichever college they want to go to. They can study whatever field that they want to go to. And they can get whatever job that makes them happy and not have to worry about having to pick a job for the money. Because there's too many kids out there right now, they don't know what to do. The markets and everything are, in the future, in AI and computers and everything. Robotics is just making everybody go nuts. Nobody knows what's going on.

Nobody knows what the future is going to be. And so people are scared and they're full of anxiety, especially college kids. And so I would like to give this skill to my children so that whatever future comes, they know they can go in and they have a skill where they can constantly generate income without having to work for it and without having to go to school for it. So that's the thing that I'm planning on teaching them. But for right now, I'm proud papa. I am happy. I'm excited that my kids are going to have this much money.

Originally I was thinking that I was going to get life insurance in large amounts. If anything happens to me right now, I want my kids to have at least a million dollars. So I was thinking, "All right, I'm going to go get a $3 million life insurance added to whatever I have already." And be like, "Okay, it'll go to my wife. But then my wife will know that each kid gets a million bucks, because that's the gift that I want to give them. But then I realized, "Whoa, I've already given them the gift. I've already given them over a million dollars. Each of them." And so, that's something that I'm really excited about, really happy.

If you have a young child, you can do the same thing. Maybe you can't do it in a Roth IRA. That's fine. Start with the 529 plan if you have to. Or fill up your own Roth IRA first, and then if you have to, you can give that Roth IRA as, when you pass away, that money can go to them. There are different ways to do it. Talk to your accountant about it, or talk to a tax professional about how to doing it. But time is of the essence. The sooner you start, the more the money compounds. The sooner you learn to trade, the more money you have to do this. And so, I just wanted to share that success story with you. One of the things that they wanted, I told them I was going to do this podcast about them, and they always get excited when I talk about them in the podcast. But I told him I was going to say this stuff, and they told me to make sure that I tell you guys how I picked a stock.

So I invest in different ETFs and stocks for them. But now that they're a little bit older, the eight-year-old and the nine-year-old this year, they got to choose what stocks that they wanted. So the nine-year-old, he picked Facebook. And the eight-year-old, he picked Google, because he's really big into YouTube. He loves YouTube. The older one, he's more logical. And so they don't use Facebook yet, but he thinks that Facebook is growing. And so, hears a lot all over the news and everywhere. So he's like, "Facebook is good and I want to buy Facebook."

And the nine-year-old, he actually looked at the stock charts. He's actually looking at stock charts. When I watch the financial news on TV sometimes at home, he'll be sitting there watching with me and he'll look at the tickers on the bottom and he'll be like, "Oh, this stock went up and this went down. This went up. This went down." He logged into my Thinkorswim and he looked at different stock charts. And he was the one that picked Facebook because of the chart. And for my four-year-old, I bought some Disney because she is, right now, she's an Elsa fanatic. She's a Frozen fanatic. All day long, every day, she just singing and singing and singing and is driving me nuts. But she is crazy about Frozen, and so Disney is a big thing. So I bought her some Disney, but I also have added some ETFs. Some index ETFs like SPY and IWM to balance it out and we'll see how it goes.

But, this is what I'm doing. I just wanted to share it with you and say, "Hey, if this is something you can do, do it." Talk to your accountant. Talk to your tax person. If you have a financial planner, ask them if this makes sense. For most people that are planning for college, it does. You have to be able to have the money put aside in the Roth IRA. The kids have to earn it. But if you could figure out a way to earn it, maybe you know somebody that has a company. Maybe you own a company. Or maybe you even start a part-time company, just so you can do this. It doesn't take a lot of money to start a company. It's not very hard.

So I think the rewards of having tax-free money put into a Roth IRA so it grows for 60 years or whatever tax-free, and then you take it out tax-free, you never have to pay taxes on that money or the growth of it, I think is definitely worth it. I think it's one of the biggest loopholes that, for some reason, it's not talked about. Some people know about it. I know definitely the rich people know about it. And so hopefully you can take advantage of it as well.

All right, folks. So take care. Trade with the odds in your favor.

--

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Jul 13 2020

18mins

Play

Robinhood Trader Commits Suicide After Large Trading Losses - 75

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Passive traders, I hope you are well wherever you are. As I record this, corona is still with us. Not the beer, the disease, the virus. And the economy is opening up again almost everywhere. It's open in some form or fashion in the United States, and the stock market is jumping up and down both without any rhyme or reason in many cases. But the Fed is behind us, and with that, I believe with the Fed pumping as much money into the economy, the stocks are only going to rally, and so people are really trying to take advantage.

I had a friend who is a friend of the family. He just graduated from college about a year ago. He was working full time and he got laid off. And so I had helped him and walked him through the whole unemployment process of how to apply for it and whatnot. He started getting his checks and his checks were in the vicinity of about $700 or $800 a week. This was more than he was making from his job because he was working on a commission basis as a salesperson. And so now he's got more money coming in than he's ever had before.

And when I checked in with him, his comment was, "Yeah, I can't wait to put this money in my Robinhood account." That threw me for a loop. I said, "Wait a minute. You have no income. You have all these expenses. What do you mean you're going to take all your money from unemployment and put it in your Robinhood account? You're going to gamble it? I don't understand." I was like, "No, man. You just graduated from college. Your mom paid for everything. Your mom is working seven days a week. You need to go take this money and give it to her." And that kind of, he was like, "Oh, yeah, right. You're right. You're right." I don't know if he did or not, but that kind of told me what the thought process is of some of these youngsters.

I was talking to another relative. He came over and he said, "Yeah, I'm in the stock market now." This one is a little bit older. He was about 26-years-old or so. And he's like, "Yeah, I'm trading. I'm in the stock market." I was like, "Oh, really." "Yeah. I bought some airlines and I bought some cruise lines." And yeah, that's wonderful. But you got to know when you're going to get out. You just can't buy it and hold it forever. These things are probably going to go back down.

Anyway, I'm bringing all this up because these youngsters don't really understand how the markets work. And for some reason, with all the advent of these cheap, free brokers, like Robinhood and Webull, and they're really appealing to the younger kids, and they have more of a gambling mentality. My attention was drawn to an article where on June 13th, a fellow named Bill Brewster who works at Sylmar Capital, basically he's in the financial space, he's an analyst, he posted that his cousin had just committed suicide. And the reason for him committing suicide was that he started trading in his Robinhood account. Somehow his account showed him that he was owing about $700,000 in losses because he was trading on margin. So Bill is asking, how does a 20 year old with no income get access to that kind of leverage? And it's incredible. It's true.

So if you are a parent and if your child is of this age, in their early twenties, maybe you should talk to them about it because a lot of kids are looking at this as a quick way to get rich. It's all over the internet. It's all over the Facebook groups, Instagram, all these places. And this seems to be like the new gold rush. Everything is going up. The cruise lines are going up 8%, 10% a day. You got to get in, you got to get in and you got to get in with options. You got to be buying options on this thing and use margin to do so, so it boosts your return even higher. These people don't know any clue of what they're talking about, what they're doing, and it's just ending really badly for some already. And it's going to end bad for many more in the future.

So if you're a youngster in your twenties, then you need to realize that this is not the way to do it. If you want to do it, go ahead. If you want to gamble, go ahead with money that you have, do not use margin. And even if you're an adult, yeah, if you're twenties, you're already an adult, but if you're in your forties or fifties or sixties, and you're trying to gamble on these stocks, please don't do it with margin. Do it only with money that you can afford to lose because every time there is a financial disaster, there are always people who commit their lives and they commit suicide and it's a horrible story. It's not worth it. It's not worth committing suicide.

I had a friend who committed suicide. He was my brother-in-law. He shot my sister, killed himself, shot the kids. And to this day, we don't know why. We could have helped if he had reached out and asked for help. We think it was financial related issues. They had other emotional issues and all that stuff too, but I think the thing that ticked him off and the thing that set everything in motion was his finances, and he could have reached out. And even in that case, it was leveraged. They had borrowed too much money. And so borrowing money never leads to good things unless you know what you're doing. And most cases, if you're looking to borrow a lot of money, then you don't know what you're doing, especially within the stock market.

So margin is a good thing as option traders, as option sellers, we need a margin account so that we can sell our spreads, but you don't want to use that margin to be borrowing stocks and borrowing against options. Things are going ups and down right now. The stock market is very volatile. It's very crazy. It can go up, it can go down any day now. There's nobody that knows how to predict a future in the stock market. Nobody can and the people who say they can are lying. And that's it, that's plain and simple. So let this podcast issue episode, and let this young child who unfortunately lost his life to this, be a warning that we don't need to be trading with margin, number one. We don't need to be taking wild bets, number two. And we don't need to be taking our own lives. Our life is worth a lot more than even 700,000 that child apparently had run up in debt to Robinhood. Now, Robinhood did not, they were asked about it. They know about the situation, but they did not share any details of the trading account or how he got so much debt or margin. But they were where of the situation. They did release a statement that they were saddened to hear the news, and they reached out to the family to share their condolences. Let this be a lesson that you need to act prudently when it comes to your finances and suicide is never the answer.

So if you're hearing this and you are in some kind of situation, you need help, reach out to somebody who can help you. If you have nobody reach out to me, I'll do my best, whatever I can do. But there is always another option. It's never too late. Everything, there's a book by this woman, Marie Forleo. It's an excellent book. Everything is Figureoutable, that's the name of the book. It's actually a great book. Pick that up if you have to, you get some help, talk to somebody. And worst comes to worse, you owe them money, big deal. There are other things, there are worse things in his life. So please, please don't take your life, get some help. All right? And I don't even know if I should say it on this episode, but trade with the odds in your favor. Be careful out there.

--

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Jun 16 2020

8mins

Play

What is a Passive Trader - 74

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

A PASSIVE TRADER IS A NEW BREED OF INVESTOR. SMARTER, CONFIDENT, RELAXED, AND FREE.

PASSIVE TRADERS ARE WINNERS. THEY KEEP THE ODDS ON THEIR SIDE, TAKE CALCULATED RISKS, AND MAKE CONSISTENT PROFITS OVER AND OVER.

PASSIVE TRADERS ARE FLEXIBLE.  THEY KNOW HOW TO ADJUST WHEN THE MARKET DOES AND STILL BE PROFITABLE. THEY PLAY THEIR OWN GAME AND USE WALL STREET’S SECRETS TO THEIR BENEFIT.

PASSIVE TRADERS ARE INDEPENDENT AND CAN THINK FOR THEMSELVES. THEY KNOW THAT NO ONE CARES ABOUT THEIR MONEY MORE THAN THEY DO, SO THEY MANAGE IT THEMSELVES, AND BETTER THAN THE EXPERTS. THEY DO NOT RELY ON FINANCIAL PLANNERS, MUTUAL FUNDS, OR ROBOTS TO CHARGE INSANE AMOUNTS OF FESS WHILE PROVIDING BELOW AVERAGE YIELDS.

PASSIVE TRADERS ARE PATIENT. THEY SIT BACK AND LET THE GAINS COME TO THEM BY KEEPING THINGS SIMPLE.

PASSIVE TRADERS ARE DETERMINED. THEY KNOW THEIR “WHY” AND IT PUSHES THEM TO STAY FOCUSED AND NEVER GIVE UP.

IF YOU ASKED A MONEY MANAGER THEY’D TELL YOU THAT PASSIVE TRADING IS IMPOSSIBLE – THE LITTLE GUY IS NOT SUPPOSED TO BEAT WALL STREET. YET IT IS HAPPENING EVERY DAY.

PASSIVE TRADERS KNOW THAT LIFE IS A GIFT AND SHOULD BE LIVED TO THE FULLEST. MONEY IS NOT THE END GOAL. SO PASSIVE TRADERS MAKE THEIR MONEY WORK FOR THEM, GENERATING AN INCOME 24 HOURS A DAY, 365 DAYS A YEAR, SO THAT THEY CAN SPEND THEIR TIME DOING WHATEVER MAKES THEM HAPPY.

PASSIVE TRADERS ARE IN CONTROL OF THEIR DESTINY, THEIR FINANCES, THEIR EMOTIONS, AND IN TURN, THEIR LIVES.

PASSIVE TRADERS…

DEFINE THEIR OWN DESTINY

MARCH TO THEIR OWN BEAT

MAKE THE WORLD BETTER

LIVE THEIR IDEAL LIFE

PASSIVE TRADERS ARE MOTIVATED KNOWING THAT THE ODDS ARE IN THEIR FAVOR.

I AM A PASSIVE TRADER!

Link to Podcast Episode 50:

https://optiongenius.com/blog/what-is-passive-trading/

Passive Trading: How To Generate Consistent Monthly Income From The Stock Market In Just Minutes A Day

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
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Like our show? Please leave us a review here - even one sentence helps.

May 30 2020

8mins

Play

The Quarantine Playbook - 73

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Today, I wanted to talk about creating a quarantine playbook. Obviously this corona thing has changed things. Everywhere you look, people have been affected, and we've been doing podcast episodes about this for a few weeks. It's on top of everybody's mind. It's what everybody's thinking about. It's affected, everybody.

And luckily now we've gotten to the point where everything is ... A lot of things are reopening. Some are already open, some are getting ready to open or they're opening slowly. I'm in Texas, and they opened a couple of weeks ago. I think gyms are open this week. Restaurants are at 50% capacity. Doctors are open. They're taking patients and everything. So, things are trying to get back to normal, but there are still a lot of people who think that things will never get back to normal.

We really don't know what's going to happen. Nobody knows. Everybody's trying to predict. Hopefully there's a vaccine or not or what, but it has really thrown everybody for a loop. We had a mandated recession, right? Bear market, 35% drop because of this virus. You already know this. You're probably watching the news. You've been listening to me, trading this market. And it's been difficult because it's something that has never been done before. We've never seen it before. Right?

But the numbers are going down right now. Depending on what state you are, fatalities are going down. I know in Texas, we're in Texas, the numbers are actually going up. Numbers of how many people sick with the virus are actually going up because now they're testing more people, but they're still opening it up. Hopefully the deaths will continue to go down. People who are sick or the virus will continue to go down. But the experts say that when everything opens up again completely, the virus can come back. If it doesn't come back now, in a month from now or two months from now, it can come back when flu season starts, at the end of the year. September, October, whenever it starts getting a little cooler, flu season is going to come, and they're saying that corona is going to come with it.

So are we going to have to start shutting down in a couple of weeks if cases go back up? That's what some of the governors have said. Even in Texas, pure Republican, they are saying that if the numbers get out of hand, they're going to start shutting down again. If it comes back with a vengeance in September, maybe they have to shut down again over then. So we need to be prepared.

Even if this virus is eradicated, maybe a vaccine comes out tomorrow and we don't have to worry about corona ever. Well, that's not true, because it's going to take a while to get everybody vaccinated. And there's still going to be those people who do not want to be vaccinated and refuse to be vaccinated. So we'll still see about that.

But this is one virus which can easily mutate. There can be other viruses, other pandemics, and as the world is getting closer and travel is getting faster, it's just going to increase. So if there's a virus, if there's an illness, there's still Ebola out there, SARS is still out there, Zika is still out there, H1N1 is still out there. All these diseases are still out there. They have no cures for them. They can easily transfer to us in the United States, or maybe there's a virus that starts here and goes over there, what goes across the pond? Who knows?

As investors, as traders, we need to be prepared. Even as individuals, we need to be prepared if a quarantine happens again. So I want to do a little mind experiment with you. Knowing what you know now, if you could go back in time or if you could send a letter to yourself or a video or whatever to yourself, 30 days before the quarantine hit, what would you tell yourself? Make a playbook.

Now, this podcast is about finances and investments. So I'm going to stay and say, Hey, yeah, let's make an investment playbook, a trading playbook for quarantine. Now you could obviously add other things to it. I mean, what would you have done differently? Stocked up more on toilet paper? I don't know. A lot of people would have in advance. Buy more beef jerky, maybe? I don't know, but when it comes to finances, we had a steep bear market. Market has dropped like 30% in two weeks. And then we had a rally off the bottom. And now we're kind of in no man's land. We're at 50% retracement from the bottom and the top, and now nobody knows what's going to happen in the market.

But there are certain stocks that are doing really well. Certain stocks are hitting all time highs. Certain stocks are at all time lows, and they're probably going out of business. They're going bankrupt. So when the quarantine hits again, whether it's corona, COVID-19, or something else, if you take some time and create a playbook of what to do, you will be prepared for when this happens again. It might be in two or three weeks, it might be close to the end of the year, it might be next year, it might be another virus. I don't know.

The only way we learn is by looking at history and then learning from it. That's how we learn from our mistakes. And this is not necessarily a mistake, but we're learning from history. First time, we didn't know what to do. If it happens again and we don't know how to take advantage of it, well, that's on us. That's our fault. You know, they say, "You fool me once, shame on you. Fool me twice, shame on me," because I should have known it was coming. And we know that most likely it is coming. So, prepare yourself. If you need more cash, if you need to take out a loan, you have that money ready, whatever you need to do, have a playbook.

What are some of the things that could be on your playbook? Well, get ready to short, because the market is going to drop. But not everything's going to drop. What are you going to invest in? When are you going to invest? If you have no money sitting on the sideline, then you won't be able to take advantage. If you're a hundred percent invested, then when it drops, you're going to have a big loss, and then when it recovers, you won't have enough money to put back in. So that's why, when we're doing passive trading, we're selling options, but we're keeping money on the side. So if there is a drop in the market and our favorite stocks lose, then we can go ahead and start buying them.

What strategies are you going to be using? In a bear market something like an [iron condor 00:06:34] was not going to work. The market volatility shoots up sky high, butterflies, calendars, all these non-directional trades will not work because there's just too much volatility. So this is something you need to think about in advance, something you need to be aware of.

Now we've already been through it to some degree. We can say it's not over yet, but we've been through the worst in this cycle. If there's another cycle, you should know what to do and be prepared. That's what I want you to do. That's what I want to focus on in this episode. That's what I'm talking about is having you sit down and take a look at what really happened. What hurt you and how can you protect yourself?

There are some of you who are looking and thinking about it, and they're like, "Man, I lost my job." There are a lot of people, 40 million people, who lost their job. Hopefully a bunch of them will get their jobs back, but a lot of them will not get their jobs back. Well, if we have another virus in six months, another quarantine, you're going to lose your job again if you don't do anything about it.

So if you're not investing, if you're not passive trading, if you're not doing anything with options, then you need to learn now so that you can do it when you're stuck at home. Because right now, yes, the government is printing as much money as they can. Yes, they're sending everybody checks. They might send everybody more checks, but they can't keep doing that forever. Eventually they're going to stop and you need to take care of yourself.

What if you had a nice cushy job, but now you have to work from home, and working from home also means that your kids are home, and so you're not getting anything done? Or maybe you're a freelancer and you get paid by the hour, but you can't get stuff done because you got to take care of your kid. Well, maybe you need another source of income.

So when I'm talking to people, traders, I'm hearing two different stories. The one story that I'm hearing is that, "Man, I don't know what's going on. Everything is so crazy. I don't know what to do. I don't want to trade right now because it's so up in the air. I don't know if I should buy stocks. They might go back down. I don't know if I should sell everything, because it might keep going up. I don't know what to do."

On the other side, I'm hearing that "Man, I need to take full responsibility and I need to take control. I gave away my power. I need to grab my power back. I need to be in control of my life. And I'm going to do that by trading. I'm going to learn how to trade and I'm going to learn how to take control of my finances. I'm going to get my house in order, because I was on risky sand, I was on quicksand. And I didn't know it, but now because of the virus, I'm sinking, and I need to fix it."

Those people are taking action, and they are joining courses, and they are asking questions, and they are listening to podcasts, and they are learning, and they're practicing, and they're doing it so that when things do normalize, they can jump in full steam and say, "Yep, here we go. I'm going to practice what I learned and I'm going to get better, so that the next time this happens, it doesn't blindside me."

That's the last thing I want, for you to be blindsided, because we know that this thing is not gone. It might be coming back. We don't know when, but it's here. And there are some experts who were saying it's going to be here for years. Some people are saying it's going to be her at least till the end of this year. Some people are seeing is going to be here till at least the end of 2021. Nobody knows for sure. But the only thing everybody agrees on is it's not gone, because there are still new cases every day. And this is just one of the viruses that are out there.

In the beginning of the pandemic, if you went to the store, and I saw videos of people going to the store and looking at cans of Lysol and disinfectant, and on the back of those cans, it says that it helps with coronavirus. It actually says that on the can, if you look on a disinfecting can, it says on the back that it helps with coronavirus. And people are like, "Ah, see, this is all fake, because these cans were made before the virus hit. These cans were on the shelves. They were selling these cans before the virus hit. It's all fake. It's all a big ploy to sell more disinfecting and all this stuff."

The truth is that this virus that we're dealing with right now is just one virus in the whole coronavirus family. It's not called coronavirus. This one is called COVID-19, but there are many other viruses in the world that all fall under the category of being a coronavirus. So calling this as a coronavirus is incorrectly labeling it. That's not the name of it, coronavirus. There are many of the viruses that fall under that category. And so that's why these Lysol cans had it on there that, hey, this works for coronavirus, because there's not just one. So now there's not just one, we're just dealing with one is causing so many problems. What if another one hits, or two hit at the same time?

This is a wake up call. Not only that, but they say that this virus is hitting more and it's hurting more people because of the way the environment is. I don't know how much I should go into that one, but it is true that these natural disasters that we're having more and more common are now hurting people who are actually sick. So, that's a whole different story.

But what I want to talk about is the playbook. Go back in time. Take a look at what happened. What are the things that you would have done to protect yourself? What are the things you would have done to capitalize on this? Because there are people, I was talking to somebody just the other day, he said it's a friend of his, and he has a factory in China where they make those little wristbands. You've probably seen them. They're rubber. They give them out as freebies, but they come in different colors and they're on your wrist. The Livestrong used to have them in yellow. They all come in different colors for branding and whatnot.

So this fellow has a factory in China that makes these things. Well, when this whole thing hit, they switched the factory from making these wristbands into making masks and some other personal protection equipment. And supposedly what this guy told me was that their factory made $15 million by switching over and selling this stuff. So there are people out there that did take advantage. There are people that got rich, very, very rich. There are still people that are taking advantage. And if you did not take advantage, then you need to be prepared for the next time.

I've been talking about in our Facebook group about some of the stuff that I was doing, and I made a list of some of the companies that I wanted to buy as they were dropping. So when the bear market was going on, I started making a list and this was probably, I already have a list of companies that I want to own, but because of the difference in what happened here, not all companies fell or dropped at the same rate. Restaurants really got hit. You know this. Airlines got hit. Cruise lines got hit. A lot of other companies got hit. And I had to make a completely new list of stocks that I wanted to buy, not for the long term, but just for a short bounce, because I thought the bear market was overdone. So when they stopped dropping, that's when I started buying.

Now, I found some good companies that I think I am going to keep for a long time, but just about every company that I bought, every stock that I bought, is up. They're up at least 20 to 30%, all of them. Some of them have more than doubled in less than a month. So, I took a gamble. A lot of these companies, they could have gone bankrupt, which is true, but I put a little bit of money in each one, diversified my bets, and now I'm back to being more positive. So even though the stock market has not recovered, my accounts are back to where they were before the bear market.

So yes, there is always a way to take advantage. Because I remember in the financial crisis, I freaked out and I sold. I sold a lot of stocks, as they were going down, they were going up. I was trying to trade it back and forth. And I lost my shirt. I lost a lot of money. This time, hindsight, experience, call it whatever you want, I didn't sell anything. Instead, I had money sitting on the sideline and I started buying. And I started buying stuff that I wouldn't buy normally. I bought some insurance companies. I bought Shopify. That one was not a stock that I even had on my radar, but it showed up on when I was looking around. And now that stock is doing super great.

So, have a playbook of what to do if this happens again. This is not the only playbook that you might want to put together. You can make a playbook for anything in the economy, because in the economy, we have cycles and things happen over and over again. They might not happen to ever quarter or every year, but every four or five years, it can happen again. So if you can make your playbooks in advance, maybe you can have a playbook when inflation hits, you can have a playbook for when oil is super high and super expensive, or when it's super low and super cheap, or when interest rates are high or when interest rates are low, when there's a presidential election. You can have playbooks for all these different avenues so that when this event occurs, you pull out your playbook, you look at what happened in the past, you look at what worked and then you go to work. And he's actually really that simple. You can actually do this because you've just been through it.

So, that's it for this episode, guys. Remember, trade with the odds in your favor and be safe.

--

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May 28 2020

17mins

Play

How Retirement Was Invented - 72

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

I am willing to bet that you did not know that retirement as we know it today is a pretty new concept. And by pretty new I mean about 60 years old? And if you are like me, you probably never even thought about it.

See in the past, most people lived on farms or in little villages and you worked the land or did your craft. Basically you kept working until you died.

That started to change in Germany in 1883. That is when the Chancellor Otto von Bismark first came up with a plan to give a government supplied income to those who were disabled from work by age and invalidity.

And after much political fighting they passed a law to create a retirement system for citizens over the age of 65.

Life expectancy was way lower than 65 at the time.

In the US it was not until 1935 that FDR created the Social Security Act that gave benefits to workers over the age of 65. Life expectancy was around 58 at the time. So again, very few were expected to collect from social security.

But by 1960, life expectancy jumped up to almost 70 years.

That is when the first lucky ones were able to actually live long enough to stop working and collect retirement benefits.

That is when leisure became a pursuit. That’s when retirement communities became a thing and gold became available to the masses.

So it has only been a few short decades that Americans have looked forward to a rewarding life of fun after a life spent working.

Currently the SS administration estimates that there are about 47 million retired people in the country.

But how are those people doing?

Not too well.

The #1 fear of those over 50 years of age is running out of money in retirement while at the same time,

More than half of all American families have less than $4,000 set aside for retirement.

Thanks to advances in science and healthcare, life expectancy continues to advance. I myself am planning to live to at least 100.

But that is a problem that is getting worse.

  1. Most retirees expect Social security to be there. But the average retiree only get about $14,000 a year from SS. That’s living below the poverty line.
  2. The SS fund is in series trouble and unless the government fixes it soon, the administration might have to cut payments to beneficiaries.
  3. Those that expect to keep working past 65 and often unable to do so.

Why?

3 main reasons.

  1. Poor health. This is the primary reason for workers retiring early.
  2. No jobs. Age discrimination is a thing. And companies would prefer to hire younger, cheaper employees than older ones.
  3. Family issues. You might end up having to care for a loved one, like a spouse, child or grandchild.

But again it wasn’t always this way.

Families used to take care of their own. But thanks to the industrial revolution that went away.

To keep workers happy, companies started pension plans. The idea was that you work for one company, stay loyal, and they will take care of you in your old age.

It worked great, until companies decided that they would rather not do that anymore.

So new laws and regulations were passed.

Retirement plans like IRA and 401ks were created.

And the age of Wall Street was born.

Now it’s not the family’s job to take care of the elderly. It’s not the company’s job and the government is not up to the challenge. So we are told to rely on Wall Street and our friendly financial planner.

Except that he isn’t so friendly like we discussed in episode 71.

So what do we do?

Is there anyone we can trust?

In a word, yes.

You trust yourself.

You take responsibility and you invest the time to educate yourself.

You manage your own money and use Wall Street’s tools to do so. But don’t get suckered by their marketing and psychological tricks.

I am so happy to be able to take the Passive Trading philosophy and methodology and put it in book form to take it to the masses.

The Great American Retirement Experiment has failed us.

Time to put the odds in our favor.

--

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May 20 2020

16mins

Play

Financial Planner or Financial Fiduciary - 71

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

A new rule by the SEC comes out next month. It’s called the Regulation Best Interest Rules and it is supposed to help reduce confusion about professionals who help manage peoples’ finances.

The rule goes into effect in June.

Currently anyone can call themselves an advisor.

Under the new rule only fiduciaries can do so.

A fiduciary is someone who is required by law to act in a client’s best interests.

Currently most advisors work in their own best interest and stick their clients with products that are best for the advisor and the company he works for. Meaning the products with the highest fees and commissions.

So if you are using a company to help you with your assets, whether it is a large bank or part of a stock broker, than you are NOT using a fiduciary. Companies like Ameriprise and Edward jones are not fiduciaries. Their agents are looking out for themselves first, second, and third.

And you are probably getting screwed.

In my upcoming book, I included a chapter about just how planners and advisors have been screwing over their clients, but I didn’t have room to go into all the details so I decided to include a free bonus with the book that goes much deeper and what I uncovered which doing research was shocking.

As far as this new rule goes, the one thing it changes is who gets to call themselves an advisor.

Big deal. The ones that are not fiduciaries will simple change what they call themselves.

Many already get certified as financial planners. Or they call themselves financial consultants, or chartered wealth advisors, or retirement consultants, or wealth managers.

It is just semantics. A play on words to trick the public and this rule will do nothing to help with the confusion.

And if that wasn’t enough, there are many companies that are registered as fiduciaries and as brokers. And so all the people that work at the companies can call themselves advisors regardless of if they are looking out in the best interest of the client or not.

According to the SEC, there are 359 of these dually registered brokerage firms which hold more than 90 million accounts.

That is a lot of people getting screwed.

So how do you protect yourself?

Easy. Learn to manage your own investments.

Use index funds and low cost providers like Vanguard and TRowe Price.

Or just use index ETFs like SPY and IWM and QQQ.

But more than that, learn to sell options on the positions you have and you will never need to be dependent on an advisor or wealth consultant ever again.

Passive Trading is the path to freedom.

As I have said on many occasions, no one care about your money more than you do.

You work hard for it. Don’t just turn it over to someone who is only looking out for themselves.

There is a reason most financial planners are broke…if what they preached worked wouldn’t they all be retired?

You know the answer and Passive Trading is the path…are you ready to proceed?

Check out the free training at passivetrading.com

And always trade with the odds In your favor!

https://www.sec.gov/rules/final/2019/34-86031.pdf

--

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May 12 2020

8mins

Play

This is a Stock Pickers Market - 70

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

My fellow passive traders, I hope you are doing well. This coronavirus really has everyone on edge, and it's been about a couple months since this thing really took hold in the U.S., and we've been sitting at home for a while now. The arguments, the protests and the discussions are getting very heated about whether we should stay at home or whether we should start opening up the economy again. Either way, it's not up to me, so let me just talk about the stock market, something that I know a little bit about.

This market is not like your typical market, of course you know that. Volatility's through the roof, but we don't even know if we're in a recession, if this is going to lead to a depression, this has never happened before. We keep hearing that, over and over again, from the financial media, from the government, "Something like this has never happened before, never happened before." Yeah, but we still have to trade it. We still have to survive through it, right? We can't just sit on our hands the whole time. I have been getting back into the market for a little bit, I wasn't doing anything, I was just watching and waiting and learning and seeing what was happening. But eventually, you got to get back in.

But right now, I'm seeing other folks try to get in the wrong way, and that's what I want to do this episode, specifically. I do not believe that this is a market to be trading options on indexes. Normally, that's what we prefer, we want to trade the S&P 500, we want to trade the Dow Jones and NASDAQ because those are safer. There's less risk when you have an average, when you have multiple companies, so in case some companies do well, other ones will do bad, so you don't get blindsided by one. But in this situation, the average is down. Most companies are not doing well, most companies, business is down, revenue is down, a lot of companies are on the verge of bankruptcy, but not all.

There are companies that are doing well, there are companies that their stocks are making all-time highs, and there's a lot more that are making 52-week highs, meaning new yearly highs. So those are the ones that we should be looking at, those are the ones that should be trading, not companies ... I mean, you can buy stocks in a company that might be going out of business. I have done that in the past, and I might talk about that in a future episode, but I have taken, well, let me just say it here: I've taken about $20,000, and I picked 20 companies that really got hit by the virus really, really badly, and I put $1,000 in each one, buying their stock.

Now, do I expect all of them to survive and make money. No, I think a bunch of them are going to go out of business. But some of them should recover, most of them. I hope they'll recover and do well. So I'm not looking on this particular instance to make 100%, I'm looking to make four, five, 6,000%, because these are very risks stocks. What I mean by that are companies that might go out of business tomorrow, but there are other companies that might not go out of business, but they're going to need a bailout. And who knows what that's going to look like? We're talking about the cruise lines, we're talking about the travel agents or the airlines themselves. These companies are hurting right now because they're all shut down, the hotels.

But then there are still other companies that are doing really well, and those are the ones I'm trading options on. I'm not buying options on the loser companies, I'm buying their stocks, because I don't know how long it's going to take for them to turn around, if they turn around. I don't want to have an expiration date. I put $1,000 in each of these companies, I could easily have bought options for $1,000. But then those options would have, and they would have an expiration. I don't want that, because I don't know how long these companies are going to need to turn around. Some of them are financials, they're banks. It might be three, four, five years. That's why I would rather own the stocks.

But I'm not trading options on these suckers, and I'm not trading options on the indexes right now, because the indexes are made up mostly of companies that are not doing well. So we have these crazy news days where the market's down 2%, then the next day the market's up 3%. Then it's down 5%. Then it's up 3%. You can easily get whip-sawed in this market, in such a high volatility market that our normal non-directional trades, like Iron Condors and Butterflies are not working either. So what do you do?

Well, this is not the time for diversification, it's the time for focus. So what I would like you to do is to check your watch list, find the companies that are doing well, find the companies that are making new highs, and stick to those only. Really tone down your list and say, you know what, I can't do all of them, I can't trade all of these. Even if it was great in the past, I can't trade it right now. One of my favorites is Starbucks: I don't think they're going out of business, it's a good company, but they're not making new highs, they're not doing, who knows how long it's going to take for them to ramp back up and get back to normal? So I'm not doing spreads on Starbucks.

If you don't have enough names on your watch list, companies that are doing well on your watch list, if you can't find any, the place to find them right now are on the 52-week high charts. Basically, these are a listing that comes out every day of the companies that are making new yearly highs, 52-week highs. So if you're on thinkorswim, you can go over to the marketplace, market watch tab, and then search for new yearly highs. If you're on Yahoo! Finance or Barchart, you can do the same thing. FINVIZ, they have it. All these free sites, they have the list every day, and you go through them. Most of them are going to be garbage, you're not going to be able to trade them. Some of them might not even have options. Some of them may be so small, you don't want to.

But you might find some gems in there that you didn't know about. Like Papa John's pizza, Wingstop, Amazon, Shopify, Domino's Pizza, and even Johnson & Johnson. Clorox has been doing amazingly well. Johnson & Johnson is on my buy list, I've been wanting to buy the stock, it didn't go down, otherwise I couldn't buy it, but Johnson & Johnson is one that I've been selling puts on because I want to buy it. I'm hoping it goes down so I can buy some shares. But I've been selling naked puts on this stock and it's doing great. So I want you to stay with strength. Right now, the big takeaway from this episode is, let's stay away from the indexes for now, let's focus on the stocks that are doing well and trade those.

This is not the time to be diversified, because all stocks are not doing well. Find the ones that are, and then when things return to normal, then yeah, you can go back to the indexes. For right now, let's stay away from the indexes and focus on the stocks that are doing well that are strong, that have good balance sheets, that have good cash, have decent revenues, and that are not going out of business, okay?

One final thing is that, stay away from companies that have exorbitantly high premium, meaning that you're doing a covered call on a stock, and it's paying you 8% or 12% for a month. There's something wrong with that picture, there's something wrong with that stock. There's a good chance it's going to tank, there's a good chance it could go out of business. So if you're doing trades and the premium is way, way high ... now normally, if you're doing, let's say, covered calls, and you make 2%, now you can make more. You can make 3%, 4%. But if you're making 8%, 12%, three or four times what you should normally be making, you're taking too much risk. So don't get greedy, and stay away from those type of stocks. Stay away from that type of risk, because yeah, you might make it on some of them, but you get one loser and it's going to wipe out everything. And you're going to cry.

So keep yourself from crying, keep yourself from taking that big loss, right? Stay away from the options that are overly priced in premium, because these companies could collapse tomorrow. One of the traders in our passive trading group mentioned that he's selling options on Macy's. That scared the heck out of me, because they're not doing well. They might go out of business tomorrow if they can't raise enough money, if they can't borrow enough money to survive. And that would be sad, it's a great company, it's been around for a while, I love shopping there. But if they go out of business, he's going to cry. And luckily, I was able to tell him, like, "Hey, man, you need to get out of this one."

But there are others out there, too, that people are trading, like Bed Bath & Beyond. Recently, there were so many people, with oil dropping, who were trading the USO. And they learned the hard way that the USO is not the same thing as oil, it's just a different, the USO is not something you want to own as an individual investor over the long term, anyway. But selling options on it, people got crushed. So things that are going to zero, stay away from, things that are giving you too much premium, stay away from. Indexes, stay away from right now, focus on strength, focus on what's working, focus on what's staying in business. All right, folks? Take care, talk to you next time.

--

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May 07 2020

10mins

Play

You Cannot Afford To Be Poor - 69

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

This is going to sound a little harsh, but you cannot afford to be poor. Makes a lot of sense, no, I don't know. You cannot afford to be poor. Maybe it's a little bit controversial and I don't mean to offend you but I want to wake you up. This is what this episode is about. Wake up. If you are not wealthy, if you are not rich, it is time to get your butt in gear and by rich I don't mean you have a huge house and you drive a Ferrari. I don't care what you drive, I don't care where you live but I'm talking about being able to survive financially, especially if your income or your main source of income or your job is taken away for a couple of months at a time. Now as I record this, we are still in the midst of this corona pandemic.

Over 45,000 Americans have died, they've lost their lives and over 30 million people are unemployed. They think it might get up to 50 million or 60 million by the time this thing is all said and done. Craziest numbers in history, ever. People have been forced to stay home for a couple months now and things are getting bad economically, financially and it's starting at the bottom and it's trickling up, right? It's starting with the guy who was living paycheck to paycheck but now he doesn't have a paycheck. It's starting with the person who is working at a Dollar General for minimum wage and is now classified as an essential worker so the store can stay open but then gets sick and can't work anymore then goes home. It's for the person whose daycare has closed because of the pandemic. And so, she cannot go to work anymore because she has to stay home and take care of her kids or school is canceled, school is canceled everywhere.

So what are these parents doing? They can't work, right? Whether you're a minimum wage worker or whether you're a highly paid professional, everybody's in the same boat. People can't pay rent and the government says that they can't be evicted, right? And the courts are closed, so you couldn't even try to evict them if you wanted to but that's causing people to miss on their mortgage payments. Now mortgages are not being paid, so foreclosures are definitely going to go up. These big banks are not collecting their mortgages and they're stuck, so they're going to start defaulting on their loans. That means insurance companies are going to have issues because insurance companies are the ones that buy the loans from the mortgage companies. The government is going to have to bail those people out and it's just moving up and up and up the chain. Savings are being depleted.

People are sitting at home if they have any savings, it's going down, most people don't even have it. Less than half the people in this country have less than $1,000 in their bank account. It's ridiculous. It's crazy, it's scary. I mean, heaven forbid you get sick. Heaven forbid you have to go to the doctor or the emergency room right now for the virus or anything else. Meanwhile, the government is printing more money than ever before. They had people come on the TV and be like, "Oh, don't worry, we're just going to print money. That's our mandate. We're just going to print and print and print and print. We're not going to let anybody fail." I was like, "Holy cow, how can they have that type of mentality? How can they say that? That they're just going to keep printing and printing and printing more money. More than ever before in history."

But in the meantime, the Small Business Loan Program that they were talking about in Congress, oh, yeah, we're going to save all the small businesses and keep people from getting laid off. No, you didn't do anything. That money ran out in two weeks. People are still getting laid off left and right, everywhere I look. The impact is being felt everywhere. I mean my personal trainer, last time I saw him, he had tears in his eyes the last time I talked to him because the gym was closed where he works, people are canceling. He has no income, people are afraid to have him come to their house because he doesn't have any of the equipment anyway. He doesn't know what he's going to do. Contrast that to the wealthy, to the rich. They are enjoying this quarantine. They're spending time at home with their families.

Sure, they're going to suffer as well financially. Well, obviously, right? Stock market is down, oil is down, business is down, revenues are down everywhere but the rich have a strong enough foundation that they know they will survive this and the rich are not going around thinking, "Oh my God, what am I going to do? Oh my God, what am I going to do?" The rich are thinking, "Hm, how can I take advantage of this situation? What can I do right now to make more money when this is done? What stocks should I invest in right now that's going to turn around? What can I do to make myself stronger in the future? There are a lot of businesses going out of business, maybe I could buy one of them. Maybe I can loan them money. The government's not loaning any money, maybe I can loan them money," right?

If this pandemic is freaking you out and you feel that you have to get back to work then I need you to make a change in your life. Please stop continuing on the road that you were on before all this happened. Fix it. Have savings, have investments, have multiple fingers so that you are not dependent on just one source of income. Let this be a wake up call for you, okay? Now I hope this virus goes away soon and things get back to normal but as soon as it does, don't go back to the same thing, don't go back to the same grind. Use this time to do something else, to make yourself more educated or stronger or better skilled. Find another way to do what you need to do and no matter when you are listening to this, okay? It doesn't matter if the virus is done and you're listening to this like two, three years in the future, it doesn't matter.

If you were to be stuck at home or without your main income for two months, what would happen to you? Best question, could you survive with no income for two months? If no, then you're poor. Harsh but true. Living paycheck to paycheck is poor in my book, no matter how large the paycheck, right? If you're making $10,000 a month and you're spending $10,000 a month, you're still poor, so please make a change. And even before the virus, okay, this is super, super important because almost every week I get at least one email from somebody who was working a very good corporate job, making a lot of money, getting on in years and then laid off and now they're stuck and now they're trying to find a way after they get stuck. After you lose your income is not the time to find a new source of income.

You need to line them up before that happens, before the ball drops, before the door slams in your face, okay? Yes, I know. When God closes the door, he opens a window. I get that but you got to know where the window is before the door slams in your face, okay? It's not good enough to let the door slam and then go searching in the dark looking for the window. You got to know where the window is first, so that when it opens you can jump through it. If you need ideas, listen to the other episodes of this podcast or email us and we'll do our best to guide you but please make a change. Let this be a wake up call. Let this be a sign that, hey, you know what? If things are financially tough for you right now, then you need to make a change.

You need to do something different and you have the ability to do so. The knowledge is there, the ability is within you. It's up to you to take this first step. Now, luckily I've been working on my Passive Trading book and hoping we'll release it very soon or maybe by the time you hear this it'll already be out. If you don't have or know the first step, that's the first step, read that book. Passive Trading, that's what it's going to be called. If you don't know about it, email us and we'll get you a link to it, okay? But Passive Trading, that's where it starts, that's where it has changed for me. That's why I am not freaked out by this mess. Yes, I know business is down for me as well but I have other sources of income and so, even though all of them are down, we're still fine. We're still surviving.

I didn't worry about not getting a $1,200 stimulus check. I didn't even qualify. It's okay, no worries. I didn't go nuts that I didn't get this PPL loan for small businesses. We cut back on our expenses but we're fine. We're still going to survive and when this is done we're going to take off again. So if you plan ahead of time before the problem occurs, you can get through it smoothly. But again, if you're facing financial difficulties right now or if you could not survive, if you lose your income for a couple of months, you need to do something different, you need to make a change. And I hope this serves as a wake up call. I hope that you didn't get sick, I hope that nobody in your family suffered but I hope that this virus or pandemic or whatever is done soon but that it served its purpose in showing you how on thin ice you are.

And it showed me that although I'm not on thin ice, I could be a little stronger too. I could have things better off as well and so, I'm redoubling my efforts as well. So don't think that this is a wake up call just for the people who are working a minimum wage job, this is for everybody, this wake up call. So please wake up because the opportunities out there, it's not as hard as you think, all right? If you don't know anything about passive trading or options trading, get educated, start doing it and you'll see what I'm talking about, all right? Hope you're all well, trade with the odds in your favor. Talk to you soon.

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

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Apr 30 2020

10mins

Play

Trading Triggers - 68

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

This is a short little episode that can make you a ton of money if you do the work. What I'm talking about I call trading triggers. A trigger is, something happens which results in something else. Basically cause and effect. Right? For example, if I lay down in my bed, I will fall asleep. Cause and effect. If I eat McDonald's every day, I will get fat. Right? Cause and effect. It's pretty normal. It doesn't necessarily mean it's going to happen every time, but it happens most of the time. There are lots of things in economics that are cause and effect related, such as supply and demand. Right? If there's too much supply, prices will go down. Too much demand, prices will go up. That's cause and effect. Trading triggers are events that happen in real life that we can capitalize from, because these events happen over and over again, and the reaction of the markets is usually the same.

For example, I'll give you a trigger that I have noticed works almost every time. That is, whenever there is a hurricane, and of course hurricanes happen often, not every day, but they do happen often, the price of wood or lumber will go up. Because if there's a hurricane and there's destruction, they're going to need a lot more lumber than anticipated, so that's going to increase the demand, and the supply stays the same, so that's going to raise the prices of lumber. So many times in the past when I have seen a hurricane that is going to be doing some damage, I've gone into the futures markets and bought either lumber or lumber options, call options, betting that the price of lumber will go up. Hasn't always happened. Maybe there wasn't enough destruction, or it was already anticipated and priced in, but many times I have made a pretty penny.

Now, I can't make a living trading this one particular trigger because there aren't that many hurricanes. Thank God there's not that many, destruction in the world. But there are many other triggers that happen over and over again that we can do some research on, identify, and then figure out what is the likeliest situation that's going to happen based on what's happened in the past. Right? Some triggers could be, what happens when the Fed lowers interest rates? That's happened many times in the past. There's a history there. We can do the research and figure out what happens. What stocks do best? What stocks get hurt? How can we make money off of this particular trigger? What happens in a bear market? Right? We don't get them that often, but when we do people know, bear market, it's a good time to buy. That's a great trigger right there.

Stocks are down. Buy more shares. Now, that's the opposite of what most people do. Most people are selling into a bear market because they're afraid. But any guru will tell you that you should be buying when there's fear in the streets, right, or blood in the streets. Fear in their eyes, or whatever. I don't know. Whatever the saying is. But when people are scared, that's when you should be buying, because that's when it's cheap. What are the other triggers that you can identify, and maybe there are triggers that you know that nobody else knows. It might be related to your industry. It might be something that you have noticed, or you have experienced in the past. Identify some of these triggers. Do the research. What happens most of the time when this trigger occurs, and figure out a way, based on what happens, figure out a way. How do you make money off of that?

I've shared mine with you about the lumber. Feel free to use that, and if you identify some, I would love it if you would share them with me. Right? If you notice something ... This is one of the reasons why I say that you need to have a watch list and you need to focus on the companies on your watch list, and trade, the majority of your trades should be on the companies in your watch list because you're going to develop a sixth sense, and you're going to start seeing triggers based on that company. If they have, for example, earnings announcement and they don't do so well, you're going to know how the stock is supposed to behave because that happens every quarter. Right? You'll see that happening. You'll know how the stock is supposed to behave.

If it doesn't behave the way it's supposed to, then maybe the trigger's broken, and you need to get out of that stock, or the stock is broken. That's one of the reasons why I tell you, make sure you have a watch list. It's very important. Please do not be out there trading every single stock in the universe. Okay? But what are the other triggers out there? Find them. Identify them. See what happens. See what the result is, what the effect is when that trigger happens. Some other examples of triggers could be ... We already talked about natural disasters. We already talked about bear markets. We already talked about the Federal Reserve and interest rates. It could be related to seasonality. Some people say there is seasonality in the stock market, so seasonality with oil. Every year in the summertime people are driving more, so gas prices go up.

That's one type of trading trigger that you could be trading. That's a very common one that people know about. But that's an example of what you could take advantage of. So if you're in the oil markets, you probably know this, know more details about it than the average person. If you're in the furniture business, maybe you know some trading triggers that are related to furniture that nobody else knows. Maybe you are in the medical business, and you see an uptick in, or you've noticed that there is a shortage of cotton swabs. I don't know what that could mean. I'm not in the medical field, but if that happens, maybe you could do a little research and say, "Okay. Why is that happening? What's the effect?" Maybe that means that people are getting sick. Maybe the shortage of cotton swabs is the effect and the cause is that more people are getting sick, or there is a particular disease that they're getting sick with.

Kind of like the COVID-19, the coronavirus. Right? A lot of people getting coronaviruses. What's going to happen? Well, we're going to need more face masks. We're going to need more ventilators. Okay, so who's the company that makes the ventilators? Let's buy their stock. 3M is the company that makes the face masks. Let's buy their stock. Right? Procter & Gamble makes Charmin toilet paper. Let's buy their stock. Coronavirus definitely was a trigger. Based on that, it impacted the economy in several different ways. We've all lived through that. We've all seen it happen. Heaven forbid there is another virus, there is another outbreak of corona, or a different type of corona. You can be ready to capitalize on this. Now, please don't send me hate mail telling me that I'm profiting off of other people's illnesses, and disasters, and all this stuff. These things are going to happen anyway.

I'm not praying for them to happen. I don't want them to happen. But if they are happening, as investors and traders, our job is to make money from what happens in the world, good or bad. That's what I'm trying to educate you on. So identify as many of these trading triggers as you can. Have them on a list. Make a list. Keep it by your desk. Whenever you see one trigger going off, what's going to happen? What and how do we profit from it? If you identify some, please, please, please share them with me. My email is help@optiongenius.com. I would love it. I'm trying to put together a massive list. I might even come up with a product or something like that where we'll share them with people. But for now, I'm just trying to come up with some for my own, and if you could share yours, that would be wonderful. All right? So find your triggers, start making some money. Remember, trade with the odds in your favor.

https://optiongenius.com

--

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  2. FREE 9 LESSON COURSE: https://optiongenius.com/
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Apr 23 2020

5mins

Play

How to Overcome Doubt - 67

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Do you ever feel doubt before you put on a trade? A little feeling that, "Oh my God, I don't know if I should do this one. Oh geez, I don't know if this is going to work out. Is this a good idea to do this trade or do it right now? Maybe I should wait, maybe not." We all do. It's normal. It's part of trading because when we're trading, we need to be right, but we can never be 100% certain. There's no a hundred percent guaranteed sure thing trade that we can have no doubt about it and just put it on and be like, "Yes, I'm going to make money on this trade." It doesn't work that way. Anything could happen. That's why trading is so lucrative because you're dealing with the unknown.

You're kind of like Elsa in Frozen 2, you're going into the unknown and that's what traders get paid for. And that's what we as investors have to take into account and we have to overcome, because I've seen, especially newer traders, that doubt that fear stops them in their tracks, where they don't put on trades or once they put on a trade, they don't want to touch it. They don't want to adjust it. They don't want to get out and so what could of been a small loss turns into a big loss or what could have been an awesome trade gets skipped because they're just afraid. There was one fellow in particular, his name was Jim, taught him the whole strategy. He knew it backwards and forwards. He could recite it to me better than I could myself. He knew the rules of the strategy.

He knew the rules of the trade and he could put a trade on almost better than anybody else, but the doubt of losing money or the fear of losing money would keep him from not staying in the trade. He would always jump out well before he was supposed to, and so he could not make a positive winning trade because he just kept getting out too fast. Anytime he would start losing a little bit of money, he would jump out even though that's not the way selling options works. A lot of times you put on a trade where you sell options and it might be negative for a few days. You might be sitting on a loss, eventually time to gain kicks in and that loss starts to go away and eventually turns out, hopefully in your favor. But even with the odds in our side, even with time on our side, there are no slam dunks. There is no 100%.

And so in this episode I wanted to talk about a way that you can overcome this doubt and put yourself in a situation that will be beneficial so that you have a little bit more confidence going into your trade, so you feel not only better about yourself, but a better about the trade as well. So I have to tell you about a cartoon. It's funny, right? We're going to talk about trading, but we're going to learn about trading through a cartoon. There's this cartoon called Bob the Builder. Now Bob cartoon series started back in 1999, and he is a nice fellow. He's a cartoon. He's not a regular cartoon. He's little bit animated, little different type of animation than your average Mickey Mouse or your Cinderella type cartoon.

But anyway, Bob runs a construction company and all of his employees are construction equipment. So the backhoe and the bulldozer and the whole makey-thingy machine, they're all his employees or partners or friends or whatever, and they all talk. And in every episode they're given different jobs to do around town and build this or do this or pay that or whatever, and eventually they get into trouble. And so Bob comes to the rescue and he has to motivate his team because now they're all sad that something bad happened and they don't know what to do about it. So Bob comes in and he asks them this one question. he goes, "Guys, can we fix it?" And all of his teammates, they all get excited and they'll smile and say, "Yes, we can fix it. We can do it," and that's how he motivates them. That's how he gets them on his side. That's how he gets them all upbeat and ready to do whatever is needed. And then they find a solution and then they put it into place and it works, and there's always a happy ending in every episode.

Now when it comes to motivation, asking a question is a little bit counterintuitive because whenever you talk to or listen to or read any of the self-help, motivational speaker type gurus out there, they don't tell you to ask questions. They tell you to be authoritative. The Tony Robbins or the Jack Canfields, Og Mandinos, Napoleon Hills, all these guys, they all tell you to do the same thing. They tell you to say an affirmation and be positive and tell yourself how good you are and how smart you are and how wonderful you are and how everything's going to work out for the best. Put it out into the universe and it's going to happen and talk as if it's already happened. Not, "I'm going to make $1 million," but, "I've already made $1 million," kind of thing. So which one of these philosophies actually works better? Is it the question where, "Can I fix it?" Or is it the statement where, "I can fix it"? which one works better?

Now in order to figure out the answers, we turn to some researchers. There was a group of researchers from the University of Illinois and also the University of Southern Mississippi who wanted to figure this out. So they ran a series of experiments in which they gathered several participants and they had to solve puzzles. Okay? The first experiment, the basic one, they basically broke them up into two different groups and the first group was told to ask themselves whether they would solve the puzzles. Basically, "Hey, ask yourself. Use a question and say, 'Will I solve the puzzle?'" The second group was told to tell themselves that they will solve the puzzles, so very authoritative. Be like, "Yes, I'm going to solve the puzzle." Which group do you think did better? Well, the group that asked themselves if they're going to solve the puzzles, solved 50% more puzzles than the other group. And then they repeated this experiment in multiple ways, they did it with writing. They had the subjects write down, before the experiment, the words will I or the words I will and the group that's wrote will I, again, solved 50% more puzzles.

Why is this? Well, researchers, they did more studies and more research and they tried to figure this out. They came up with two reasons. The first reason is that by its very form, when you ask a question, you give yourself an answer. So if we're going to ask ourself a question and say, "Should I put this trade on," or "Am I a good trader?" Instead of saying, "I'm a good trader, I'm a great trader. I'm going to trade, trade, trade." It doesn't help you overcome a lot of fear of if you should be doing that particular trade. It doesn't make sense. When you ask yourself the question, you give yourself an answer automatic. So if the question is, "Should I do this trade?" or "Should I be a trader?" or "Should I be an investor? Should I invest in this?" The answer comes back to, "Yes" or "No." And if it's a, "Yes," then you're going to give yourself a reason or an answer. "Why?" And if it's a, "No," you're probably going to come up with a reason why and if it's a good reason, then you can fix that so that you can go and do the trade.

The second reason is that the self-talk, when you're talking to yourself, when you're asking a question and you're telling yourself the answer, it helps you to visualize your end goal, and that goal becomes an intrinsic goal instead of an extrinsic goal. So it's going to be more about, "If I put this trade on, if I do a good trade, then I'll feel better about myself," versus "Oh yeah, I'm a good trader. I'm going to go get me a Ferrari," kind of thing. So those two reasons were what researchers came up with. Now when we're putting on a trade, again, there's no sure thing. Of course experience helps, but if there's a bear market, if there's a high volatility market, if things are going on that have never happened before, then even experienced traders don't know what to do. And we have doubts and say, "Man, should I be really doing this trade? Should I be putting this trade on?" And if you're feeling that doubt, then you can ask yourself a series of questions instead of just trying to pump yourself up.

Now I definitely believe that you should pump yourself up if you're feeling doubt, and if you cannot even do a single trade, then you need to ask these questions even more. But if you're feeling that hesitation, "Oh, man, I don't know if I should do this," that means that something's not aligned physically, emotionally, spiritually. Maybe something is not aligned with your trade and you need to get to the bottom of it and ask yourself some questions. One of the questions would be, "Should I even be doing this trade?" It's not a question of, "Can I trade? Can I be a trader?" Yes, you can be a trader. If you don't know that, then I'm telling you right now, yes, you can be a successful trader. There are other people out there that are stupider than you that are doing well at it. Okay? I'm sure that you can do it. "Can I be a trader? Can I be a successful investor at that?" That question, let's just take it off the table. The answer is yes. If you don't believe it, I'm telling you the answer is yes. Okay?

Now the next question is, "Should I do a particular trade?" And when you ask yourself that question, then you have to dig in further and you have to justify it and you just say, "Oh, I heard Jim Cramer on his Mad Money show talk about XYZ stock and the CEO came and I really liked the guy's tie so I'm going to buy this company and I think the shares are going to go up." That's not a very good reason, right? "Should I buy that stock?" If that's the reason, because you liked the guy's tie, maybe when you say that to yourself, when you answer that question, "Should I do this trade?" And you tell yourself, "I'm doing it because I like the guy's tie," I think you'll figure it out yourself that, "Okay. That's not a good reason. Maybe I should do a little bit more research or maybe I don't do the trade." But once you ask that question, "Should I do the trade?" it leads you to the next question, "What do I expect the trade to happen? What happens if the best case scenario happens? What happens if the worst case scenario happens? What do I think the stock's going to do and what happens or what do I do to the trade if it works out in my favor? What do I do if the trade doesn't work out?" That way, you're prepared for both eventualities.

If it works out, great. You know what to do. You know how to get out and you get to be happy. If it doesn't work out, you're prepared in advance for anything that could happen, especially if it doesn't work out in your favor, but you know in advance, so that eliminates some of the doubt. If you know you have a justification for why you're doing the trade, if you have some reasons, if you know what you're going to do if the trade works out in your favor, if you know what you're going to do if the trade doesn't work in your favor. It goes against you. If you know what you're going to do in advance, it takes away doubt. So if you've been having trouble putting on trades, whenever you listen to this, the market might be topsy-turvy. It may be very volatile. It might be going straight up. It might be going straight down, might be going sideways. I don't know.

But in all markets, there are trades that are possible to be made. If you're feeling doubt, that's your self telling you that something is not aligned. And yes, you could be just rah-ing yourself and telling yourself, "Yeah, yeah. I'm going to make $100,000 today," or "I'm going to make $100 today trading. I'm going to be do this, rah rah. I'm the best trader in the world. Woo-hoo," or you can be real and you can ask yourself some questions and use that as a way to pump you up and to motivate you. So can you fix it? Yes, you can because Bob Builder does and that's how he motivates his staff. Now in Bob's case, he's a cartoon. His viewership, his audience, is little children. So whenever he says, "Can we fix it?" All the little kids that are watching, they respond with, "Yes, we can."

I don't want us to say, "Can we trade?" because that's not the right question for us. We're not trying to get little kids to give us a positive answer. We're not asking the question for anybody else. We're asking the question for ourselves. "Can we trade?" is not the right question. It should be based on each individual trade. "Should I be doing this trade?" and you have to have a legitimate reason. If you do have a legitimate reason and you know what you're going to do in advance, that will help you cut through the doubt. And actually, if you put on the trade and keep your head in the trade, in the game, while the trade is going on so you don't lose your cool, you don't get caught like a deer in the headlights and not know what to do if the trade goes against you. I hope this was helpful. If you have doubt, listen to this a couple times, go through the process. It definitely helps. Remember trade with the odds in your favor.

PassiveTrading.com

OptionGenius.com

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Apr 16 2020

13mins

Play

What To Do When An Opportunity Presents Itself - 66

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

The famous Baron Rothschild said that the time to buy is when there is blood in the streets. And Warren Buffet has said the time to invest is when others are fearful, to be greedy when others are fearful. But others are fearful for a reason, so is that actually the best advice? When is a good opportunity, and when is it a disaster that just looks like an opportunity? That's what I cover on this episode.

So how do we limit our risk and not do any of the work? That's a totally new way of looking at it, don't you think? I was pretty proud of myself when I came up with that question. How can we have a large upside with a small downside, and none of the work, none of the time? Because in the end, that's the most important and most precious thing we have, right? Time. We have to guard it as best we can.

So that question led us to a third solution. We could bring in somebody else as a partner who would be responsible for day to day operations and running the center. My wife would be there in the beginning to turn things around and to train this person, especially since she has done that before, and she knows the business, while she's training this new partner.

So that is what we did. We offered another woman and a friend of ours 50% of the business and the center to be the working partner. We would train her and support her until the place was running and doing well, and of course we would support her the whole time, because we're involved, but my wife would own 25% and our original partner would own the other 25%. so we're cutting our percentage down, right? We're taking less of the business, we're going to get less of the profits, but if all goes well, we won't have to do the work. Put up less money as well. Have a person in place that will run it, who has been trained by us. And if all goes well, eventually we make $5,000 a month instead of $10,000, but without having to do the work. Now, to me, that one sounds better. We turned a good opportunity into a wonderful opportunity.

Now, let's take a look at this from this new woman's perspective, right? This new partner that we're bringing in, let's call her N. Now, N has never worked in a daycare, but she wants to. She's been looking to buy a daycare or get involved with a daycare for months now. Financially, her family is struggling. Her husband has his own business, but that business is failing. It's going to close soon, so money is tight. Now, N is offered a 50% stake in a business that is currently losing money, right? It's losing anywhere from breaking even some months to losing about $5,000, $6,000 a month. She is required to put up more money than she has right now to take advantage of this situation. She's going to have to borrow that money. Maybe not all of it, but at least some of it.

So let's say she needs to come up with $50,000. Okay, that's 50,000 she doesn't have. The business will not make money for a while, and she's not going to get paid until the business can afford to pay her a salary. So she's looking at probably six months with nothing to show for it, but she's building up her own business, an asset. If she can borrow the $50,000, or however much she needs, and if she borrows it, she's probably going to have to make payments on it. So they're going to have to come up with some way to be able to make the payments, still support the household, while she's doing this. But the upside is that she could make than $10,000 a month eventually, which is more than enough to support the family.

So yeah, there's risk involved. The place might not turn around. It might not be as rosy as I'm making it out to be. That's a risk. She will also have a strong set of partners who are well-capitalized. If we need more money, we're not going to let her drown, right? We're going to put the money in. They have experience and connections, and who are not only willing to work side by side with her until the place is turned around, but they've done it before. Meaning my wife has turned around a failing daycare before.

What should you do? What would you do in this situation? To me, from her point of view, I think the choice is simple. I would take the deal, in a heartbeat. Now, what she does eventually, we haven't gotten an answer yet. We don't know. To me, I think it would be crazy if they say no. They're already in a sinking boat. The boat is sinking. They have no other alternatives. They have no options. They have no lifelines. They have no life preservers. And here you have somebody coming by, throwing you a life jacket. Do you take it or not? I don't know. That's up to them. We'll find out.

How do you know when you are presented with an opportunity if you should take it or not? How do you know if it's a good opportunity or if it's just a disaster dressed up like an opportunity, right? And please don't tell me that you don't have opportunities. They're out there. They're everywhere. I mean, buying a new stock is an opportunity. Looking for a new job is an opportunity. Getting a loan for something, that's an opportunity to do something without money, creative, right? Even deciding to buy a new training course.

I'm sure you get emails from lots of gurus. "Buy this, buy that, buy this. I have courses. I'm emailing you. Dave, you're on my list. Get on my list if you're not, but if you aren't, if you're on the list, then I'm telling you, hey, I got this course that might work for you. I've got this that might work for you." These are all opportunities that can either be beneficial or harmful, but you have to make that decision.

So I have a list of questions that you need to ask. So if you're in the car, or exercising or something while listening to this, you're going to have to go back and actually write these questions down so you can save them and keep them. So next time you have an opportunity, you can go through this exercise and it will help you clarify in your mind and help you decide what to do.

So first of all, you got to know, what are your longterm goals? You got to know, without a doubt. If you don't know what you're trying to do in the longterm, you're going to jump at every single opportunity. If you haven't decided yet that you want to be a passive trader, then the next time you see an opportunity for a real estate workshop, you're going to go. If you see a 4X course, you're going to buy it. If you see a new job offer, "Oh, hey, why don't you drive for Uber?" You're going to go run and drive for Uber. The goal should not be, "I just want to make more money." You have to have it more defined than that.

Right now for my wife, the goal is more income without the work, and that is what led us to the solution that works best for us, right? If we didn't know what our goal was, we would not have tailored it and changed it so that it works best for us. Now, yeah, we can make less money, but our priority was not the money. It was the time. You understand? So that's number one.

Number two, you have to look at the pros and cons. Now, you probably already do this. Common sense. You write these down if you have to. What's all the benefits? What's all the negatives? What could happen? What could go right?

Third, then you look at the probabilities. How probable is each outcome? You know, let's look at the worst case scenario. How probable is that? The best case scenario. How probable is that? And then somewhere in the middle.

Next, what is the risk involved? Right? Normally, if it's an investment of money, you have to put up the money, and that's the risk. The whole money you put up is at risk. How can you minimize the risk? That's a very important question. You still want to keep the benefit. You still want to have the potential as much as possible, but you want to reduce your risk as much as possible as well.

Next, what is the possible reward, and is it worth the risk? What's your risk-reward analysis? Is the reward worth it for the risk? Sometimes that's an easy one. You'll be like, "No, not really." You're going to be giving it up. Okay. If there's a course out there teaching you how to make $100 a day and the course is charging you $1,000, okay, that might be worth it. In 10 days I could get my money back. Yes, but it takes you 12 hours a day to make that $100 bucks. All of a sudden it doesn't make sense. The reward is not worth it, right? You spend 12 hours a day to make $100 bucks, that's not worth the risk, so you would pass on that opportunity, right? Simple concepts.

Number six, I want you to get advice from people that have done the same thing that you're thinking about doing successfully. Not just that they've done it before, but they've actually been successful at it. What do they say? What's the advice? If you ask them and say, "Hey, should I do this or not?" What do they tell you? Most people, most successful people are honored when they're asked for advice, and they will actually give you legitimate, truthful advice, okay? Just like it says in the book, The Richest Man of Babylon. If you haven't read this book, it's a classic. You got to have it. The Richest Man in Babylon. It says, "If you are investing in jewels, you don't send a brick layer or a brick maker to buy your jewels. You ask a brick maker when you're investing in bricks and you ask a jeweler when you're investing in jewels." Okay? So you got to get advice from the right people and people who have actually done it well.

Next, what does your gut tell you? That's what it comes down to, because you are ultimately responsible, and your gut, well, you know that feeling in your stomach, that can tell you one way or the other if you should do it or not. Because if that gut is telling you, "Don't do it," or, "I'm scared," or, "I can't handle it," and you still make the investment, you're going to end up miserable. Even if it works out well, you're going to end up miserable.

A friend of mine, he did a real estate fund recently that I invested in, and I got other people to invest in, and one of the people that came up to me and wanted to invest, and she put the money in, but it was for a one-year term. You had to have your money in there for a year. After six months, she lost confidence, or she freaked out, and she said, "Can I get my money back? I need my money back. I need my money back." And we told her, "No. It's locked up for a year. You can't get your money back." Even though the fund was doing well, we were making money, there wasn't a loss, she was going to get all of her money back, plus she was going to make a nice gain at the end of the year, she still freaked out and she couldn't do it. Now, if she had asked her gut before making the decision, maybe her gut would have been like, "No. We're not very risky people. We don't like taking risks." So she would have sat out of it. That's how important your gut is.

Now, last question, can you live with the worst case scenario? Can you? Only you can decide.

Now, after asking all these questions, you're going to have a much more clear picture of what you should do. So now let's take all this information. Let's do a real life exercise, okay, so that you know what it is. Currently, and I'm recording this March 31, so 2020, right? Currently the stock market has dropped about 30%. Volatility is sky high. The coronavirus has become a pandemic and we're all staying inside and away from people to limit the virus, to try to control the virus, which is still raging out of control. People are still getting sick, people are still dying, and we've already had 3,000 deaths, and they're saying that there might be 200,000 deaths in the US.

Should we invest in the stock market at this point? It's a legitimate question, right? I mean, things have come down 30%. Some stocks that we're trading have done a lot worse than 30%. The travel industry, the food industry, they've all been killed because they've been shut down by this virus. Now, we all know it's temporary, hopefully. I don't know when you're listening to this, but you know better than I do, because you're in the future, but hopefully this thing will shut down. Now, I'm giving this example. Don't be like, "Oh, yeah, I know what happened, and it was either a good idea or bad idea to invest." I don't know, but these types of scenarios will occur over and over throughout history. So this is just one example of how you look at an opportunity, and the opportunity is, "Hey, stocks are down 30%. Do we buy here?"

So what do we ask ourselves? Well, number one, what are our longterm goals? If your longterm goal is to build up your stock portfolio and hold onto these stocks so that you could trade options on them for years and years to come, like we talk about it in our Passive Trading Formula course, then maybe we should start buying now. Or if your goal is to become an options trader only, and only trade options, not own any stocks, well then it doesn't matter how low the stocks go, you shouldn't buy them because that's only going to distract you from your goal, right? So for you, this is an opportunity that you should pass on.

Number two, what are the pros and cons? Well, obviously you can make money. Right? Pro. We could also lose money, because the stocks could drop even more. The virus has not peaked yet. We don't know what's going to happen tomorrow. Things could get worse. What if all the businesses and everybody shut down for the whole year of 2020? That will definitely have the stock market go down a lot more.

Number three, what are the probabilities? Well, worst case, we lose all our money. That's probably not going to happen. I mean, I don't think the stock market is going to zero. Most of the stocks we buy are not going to go out of business. Well, some of them will. If it's worst case, most of them probably will not. Best case is the virus disappears and the stock market rallies 100% percent. That's probably not going to happen either.

What could happen is the market drops another 30% from here. That would be a 60% drop, which in history doesn't happen too often. It's possible. That might be the worst case, actually. 50, if it drops another 30% from here. So if our risk is a 30% drop, how do we minimize that risk? Well, we can wait. Maybe we don't buy stocks now. That's one way. Or maybe we could hedge our position by buying put options. That's another way to do it. Or maybe we can buy some shares now and then we buy a few more every week. So whether the stocks go down or whether they go up, we're just buying a few more every week, every week, every week, because we can't predict the future. We don't know what's going to happen.

The possible reward is that we don't buy at the bottom, right? But we still get stocks at a really cheap price compared to where they've been before, and where they're eventually going to go again. 30 years from now, are we going to have a stock market? Yeah. Are stocks going to be higher than they are now? Probably. Right? So if you look at those probabilities, then yeah, it's a good time to buy now and hold, and you guys are fortunate enough that you know how to sell options on your stock so that you can actually generate an income while you're waiting for the stock to go up.

So what are the people who have made a killing in the stock market, in this same situation, doing right now? People that took advantage when stocks dropped before in bear markets, what are they doing right now? Well, the ones I've been able to investigate and research, most of them are buying small amounts of stocks that they want to own. Not huge quantities. They're not just going out and betting the farm. They're not borrowing money to buy these, but they're buying small amounts. They're not waiting for the bottom, nor are they just sitting on their hands doing nothing. They're actually in the market right now.

The last week or so, we've had a little bit of a rally. The VIX, the volatility index has actually come down a little bit, so some people are a little bit ... The selling has abated. It might happen again, but it seems to have calmed down a little bit. I myself have started buying some shares that I want to own, and I've been selling naked puts way out of the money on stocks that I wouldn't mind owning. These are shots at Coca Cola and Johnson & Johnson, Las Vegas Sands, stocks that have taken a beating, right, and they're much cheaper now than they were before, but in the longterm, by owning them, I think they're going to go back up. They're very strong. They pay good dividends. So I am making 1% to 2% a month income while waiting for these stocks to drop even more, because I'm selling my puts out of the money. So that meaning that I want them to drop even more before I buy them, and I'm getting paid to wait.

So next question. What is your gut telling you? Maybe your gut doesn't know in this situation, which is normal. I don't know. My gut's like, "I don't know. Don't ask me. I can't predict the future." And then lastly, can you live with another 30% drop in stocks? So if you buy now, if you take all your money out and you buy now, can you live with a 30% drop? If you can't, then don't do it, or do something else. Don't buy all right now.

Now, based on this exercise, if you were thinking about investing in stocks right now, I don't think the answer is to buy 100% everything right now. To minimize the risk, I think the answer would be to maybe start with a little bit, right? Maybe sell some naked puts if you know how. Ready yourself if stocks move lower, but buy more shares as they do. So as they go lower, buy more and continue to buy more. If you don't know how to sell naked puts, this would be a great time to take advantage of our Passive Trading Formula course. You can learn more at passivetrading.com and we'll show you exactly how to do it.

In our group, our community, I actually share some of the trades I'm doing, some of the stocks that I've been selling options on, and we have a really good community of other traders who are in the same course who are also sharing their trades. So by yourself, yeah, you can probably do well, but when you have a community that thinks the same way and when they're helping each other out and when they're sharing what they're doing and sharing ideas, it helps everybody.

So right now it's a scary time. We're all stuck in our homes. We're walled off from our fellow human beings. So if you haven't, look online, find some groups that think the way you do and not groups that are trying to scare you and tell you how the world's going to end. We don't need more negativity. Let the government handle the business that they're handling. Let them handle the virus and let the health people do that. We just listen to what they're saying. Stay home, stay safe, and prepare for the future. And right now, this is an amazing opportunity for you to take some time and educate yourself about how you can use the stock market to your advantage, okay? So if you want to check it out, it's passivetrading.com we have a free training there that you can watch and learn. I hope this helped. Please stay safe and remember to trade with the odds in your favor.

PassiveTrading.com

OptionGenius.com

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
  3. WATCH THIS FREE TRAINING: https://passivetrading.com
  4. JOIN OUR PRIVATE FACEBOOK GROUP:  https://optiongenius.com/alliance

Like our show? Please leave us a review here - even one sentence helps. 

Apr 06 2020

46mins

Play

3 Secrets The Rich Do Not Know -65

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Recently I attended a mastermind meeting with other online marketers. These folks are super smart, super rich, and super savvy.

They are the ones that introduced me to crypto arbitrage. Yes, that is a thing.

Everyone presents something in the meeting that can help the others. I decided to talk about 3 things that have shaped my life up to this point.

I expected them to already know about these secrets, but not one of them knew of all three. In fact, none of them knew about #3.

The three I talked about were:

1. The Wave Theory of Life

2. The Five Finger Theory

3. Passive Trading

Passive Trading literally blew them away. They were mesmerized.

Listen to the episode to hear me describe all three secrets!

Link to Episode 4: 5 Finger Strategy

https://optiongenius.com/blog/five-finger-strategy/

PassiveTrading.com

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
  3. WATCH THIS FREE TRAINING: https://passivetrading.com
  4. JOIN OUR PRIVATE FACEBOOK GROUP:  https://optiongenius.com/alliance

Like our show? Please leave us a review here - even one sentence helps. 

Mar 11 2020

7mins

Play

Selling Puts vs Owning Stock - 64

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Passive traders, I hope the markets are treating you nicely. Today I want to do something pretty cool. So I am finishing up the book called Passive Trading. Has been taken me I think over two years, but I'm finally getting close to completion. My editor told me that it's probably better to add a few examples of trades that I've done in the past and some examples of the different strategies that we're talking about. So I was like, "Yeah, that makes sense." So what I did was I decided to go into the past and pick a stock and say, "Okay, this is a stock. What if I did what I'm telling everybody to do? How would it work out without knowing anything about the future or anything like that?"

The example was for naked puts, selling naked puts. That's one of the strategies I cover in the book. I talk about it, say how to do it, this and that. And I said, "Well, what would happen if I take my strategy, how to do it, and go and apply it in real life?" So I picked Walmart because Walmart is not a stock that I own. I don't follow it on a regular basis. It is on my watch list because it's a good company and it pays dividend. It might be one that I want to get into, but up till now I don't own it and haven't traded it very much. So I said, "You know what? Let me go into Walmart. Let me try it and see."

So 2018, January 2018, Walmart was trading at $98.59. That was really good because in 2017 the stock was up 42%, so had a great year in 2017. What's it going to do in 2018? I don't know. I don't remember. And I haven't traded, so I don't know. So what I decided was I am not going to own the stock. I am only going to sell naked puts on it. If I get assigned on those puts, then I will see what I have to do there. Maybe I will sell the stock and keep selling more puts or maybe I will keep the stock and start selling covered calls. Either way, I'm going to have to do something, but I'm not going to roll. That was the decision. I wasn't going to roll my putts. I was just going to take the stock.

So I started on the 2nd of January, okay? First trade I did sold some puts, made 3.6% because the puts expired. Nice. Did another trade in February after that one expired. After the first expired, I did it in February. That one also expired. 3.2% gain. Then I did do one in March. 3.54% gain. Did one in April. 5.54% gain. Geez. This is easy, right? All I'm doing is selling naked puts on Walmart away from the money and I'm getting really nice monthly gains, and I'm not having to watch it. I'm not following. I'm not adjusting. I'm not doing anything. I'm selling the put, waiting till it expires, and then selling another one. That's all I'm doing.

Then, May came. Those puts expired. 2.83% gain. June, 1.85% gain. July, 3.9% gain. August, 2.53% gain. September, 2.75% gain. October, 4.89% gain. And November. Oh, November I finally get assigned. So on December 21st, Walmart closed at $87.13, which was 37 cents lower than my sold strike, so I had to buy the stock at $87.50.

Now, you might be thinking, "Oh wow, Allen, yeah, anybody can make money selling naked puts in a bear market." Walmart went up 42% the year before. It probably went up close to that in 2018 when you were doing it, right? Well, yes and no. 2018 was a year when Walmart traded from $98.59 at the beginning of the year. That's when I started trading. It went up to $109.55, so it did go up. But then once it got there, it turned around and went down all the way to $82.40, and then it ended the year at $93.15, which means that the stock was actually negative 5.6% for the year. So if you had owned this stock, if you had bought it on January 2nd, first day of trading in 2018, and you held it to the end of the year, you would've lost 5.6%. Now, you would've gotten the dividends, so maybe it's an even, but still that's dead money. You're not making any money on this stock if you are only buying it and holding it for the whole year.

But if you had done what I did and you had sold naked puts the whole way, you would've made 34.65%. Let that sink in here. I was selling naked puts on a stock that went up and down and up again and closed down. So this was not a stock that just went up in a straight line. This stock lost money on the year. But because of the naked put strategy, I made 34%, okay?

This is without owning any stock. I didn't own the stock until very end of the year, until December 21 when I actually had to buy the shares. Until then, I didn't own any stock, and I didn't really spend much time on it. I just put the trade on, let it expire, and then put on another one every month. Takes literally five minutes or less. Didn't watch the news on Walmart. Didn't care about earnings, or announcements, or what they were doing, or how the stock was doing. Doesn't matter. Didn't care. All I did was sell a naked put every month. Let the one expire, sell more, let it expire, sell more, let it expire, sell more, let it expire, some more on a stock that went up or down. Now, I understand if this was a stock that had just gone straight up, then yeah, you could say, "Oh, yeah. It just went straight up. Of course you've made money." True, but this was not that. This was a stock that went up and down, right?

So this was just one example that I did for the book. I just thought this was a really freaking cool example. I did a couple other examples we did on credit spreads on comparing owning the stock, a stock that was really good. I'm just going to tease you here. I'm not going to tell you what it was. But I picked a stock, I went back and I said, "All right, in this year, 2000 ... " I don't know what year it was. Think 2017 or 2018. I said, "Give me one of the best performing stocks." And I got a list of all the ones, and I said, "Okay, this one I think we can do credit spreads on." So I picked it, and I did spreads on it month, after month, after month, after month, after month, and the credit spreads did better than if you had just held the stock. Even though the stock was one of the best performing stocks of the year, you would have done better by selling options than holding the stock.

And this Walmart example is the same thing, same conclusion. 34% compared to negative 5%, okay? Less stress, less time, and a lot more money. That is why we sell options. That is why I'm into passive trading. Cool?

So if you want to learn more about passive trading, you can go to passivetrading.com. The book itself is ... Like I said, I'm going back and forth with the editor. Hopefully it will be out soon. If you want, you can email us about it or just go to passivetrading.com and see. It might there. But that's it. Yeah. Selling options come put together with owning stocks makes more money. I don't know if I can make it any simpler. And this was a real example. Like, dude, these are the numbers, you know? And in the book, I'm going to have what are the dates, what are the exploration, what are the price, what did I get, was the result. Everything is there. So you can go and check it for yourself.

Were these actual trade? Yeah, they were done. This was real numbers, okay? I didn't even think it was going to be this good. To be honest, I didn't know it was going to be this much of a difference, 34% gain versus negative 5% for owning a stock. Holy cow. That blew my mind. That's why I wanted to do an episode on. That's why I'm be like, "You guys got to look at this. This is so cool. This is so amazing. Why aren't you doing this, right? Why aren't you doing this right now?" All right folks. Until next time, trade with the odds in your favor.

www.passivetrading.com

www.optiongenius.com

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Mar 02 2020

9mins

Play

Etrade Trading Account Hacked, Lost $15,000 - 63

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

This episode is extremely important for anyone who is saving money for retirement. If you are investing, even if you're not trading, the information that I'm going to cover in this episode is going to scare the daylights out of you, but luckily there are steps that we can take to prevent massive, massive loss and fraud.

Passive traders, warning, your account, your trading account is going to be hacked. If not today, then it's going to happen tomorrow. But at one time, your account is going to be hacked and money will be taken from your account unless you take strict, crazy actions to protect yourself. My E-Trade account was hacked for $15,000. That money was taken out of the account with no notice to me, no indication. I didn't know anything was going on. Luckily, I figured it out. When I found out how they did it, my mind was blown how easy it was.

Now, let me tell you the whole story. Back in October of 2019 E-Trade limited what I could do with my account. Now, I have one account with E-Trade. I have had it with them ... This account has been open for years and years. Before it was with another broker that got bought out by another broker named Option House. Option House then got bought out by E-Trade and recently E-Trade just announced that they're being bought out by Morgan Stanley. So this account has been open for years and it has well over $100,000 in it. But I don't use it for options trading. I've only bought some long positions in stocks and has just been sitting there. So this is not an account that I checked on a regular basis.

But back in October of 2019, they limited what I could do with the account. They sent me an email saying, "Your account is limited." They made me call them to verify who I was. I didn't know why. But when I called them, they finally told me that, "Hey, someone was trying to withdraw funds from this account from different places all over the world, from different countries." So they wanted to make sure that it wasn't me and that it was fraudulent. Now luckily, they had stopped those transactions and those withdrawals, but they wanted to place a limit on the account until I got in touch with them so they could verify.

Once they verified it was not me, we changed my password and everything was fine. Account was back up, no restrictions. Now again, this is an account that I only log into maybe once a month, if that. All right. Every other month or so I log in just to see how things are going. Now, in January of 2020, so that was October when they alerted me to the fraud. Three months later in January of 2020, I logged into the account just to see how things were going. By chance, I mean this was luck that I noticed this, on the side of the screen it has a little section, little widget or whatever it's called, and it says recent activity.

On that recent activity thing, it showed ACH withdrawal. That's all it said, ACH withdrawal and a date. I'm thinking to myself, "What is that? I didn't withdraw any money. What could this have been? I don't understand. What is this?" So I clicked on it, went to the ACH withdrawal page to see what was going on, where the money was going. It didn't make any sense because I found several other withdrawals as well to different places, Discover card, Kohl's, something called Gemini, a whole bunch of other vendors. I didn't know what this was. Over the past two months, so over November and December, close to $15,000 was siphoned off in small amounts and then larger ones, so a couple hundred dollars, $300, and all round weird numbers.

It wasn't $300. It was $315.42. And then there were larger ones. They started off as small amounts and then they got larger and larger. Every couple days there was another withdrawal. So I get on the phone with E-Trade to report this. I spoke to somebody in their customer service who filed a report and I had to tell him to stop all the withdrawals. So he's taking my information, asking me, "You didn't do this and you didn't withdraw your Discover and you didn't withdraw to Kohl's?" I'm like, "No, I don't have a Discover card. I don't have a Kohl's account. I don't know what any of these vendors are. Stop the withdrawals."

So he goes, "Okay. I will stop all the withdrawals to these vendors." I'm like, "No, dude. You need to stop all withdrawals, not just to these vendors, to every single vendor out there. I want a complete pause on this account. I don't want any money going in or out of this account any more until you figure out what's going on and until I get my money back." Because for some reason he couldn't figure that out on his own. I don't know. He told me he's going to take over a week to investigate. If there's fraud involved, which of course there is fraud involved, it could take up to 90 days to get my money back. 90 days. Now, the one thing I couldn't figure out is how they got any money out of this account in the first place because just about every penny I had in there was already invested in a stock.

There was maybe a couple thousand dollars leftover in cash, but I didn't have no $15,000 that these guys had taken out. I couldn't understand it. So it wasn't like I was out any money, but I'm sure that if I hadn't reported it, then E-Trade would have come after me for that $15,000. A week later, the investigation's going on. I'm going to wait back. Hopefully they have stopped it. Actually I kept logging in every day and I noticed that the ACH withdrawals were still happening. They weren't approved, but whoever this scammer was, this hacker, they were still trying to withdraw money. But now it was getting stopped. It wasn't happening any more. But they kept trying and they kept trying.

So a week later I get an email from my other broker, Ameritrade, that one of my accounts there had been hacked. Now this, to me, is more scary because I have several accounts at Ameritrade. So I get on the phone with them. I'm like, "What's going on?" They told me the account. I mean that account doesn't have any money in it. It should have been shut down years ago. I think it has two cents in it, that's why they kept it open. But somebody was trying to hack into that account. Luckily, it didn't have any money and they stopped it. Were the two incidents related? I don't think so. Probably not, because if they can hack into one Ameritrade account, what's to stop them from hacking into all the other ones?

This was an account that we didn't even use, so that was interesting. But the E-Trade investigation, okay, this is the crazy part. This is how they stole the money. The E-Trade people discovered that the scammers had gotten a hold of my account number, not my password, not my username. They only had my account number. They only needed my account number and the E-Trade routing number to steal money. Now, the E-Trade routing number, you can go online and Google it and you'll figure it out. That's not hard to do. Now, think about it. If a scammer, the only thing they need is your account number, I mean, how many people do we share our account numbers with?

They're on our tax returns. They're on our bank statements maybe. They are on our mortgage applications or credit applications. I mean I never considered that as top secret information. I didn't give it out to anybody, but it's not top secret. But if that's all they need to steal money without even us being notified, this is a serious, serious security flaw in my books. What the hell? This scammers, they didn't even have to log into my account. All they did was they used the account number and the routing number and they set up payments to all of their different accounts. So Discover was an account that they had. Kohl's was an account that they had.

All the other stuff were other debit cards or credit cards or whatever, these accounts that they had, they were able to set up ACH withdrawal payments from my account to pay off their accounts. Again, like I said, these withdrawals continued to happen even after I reported the fraud. No money was taken out, but they kept trying. It was like set on autopilot. Guess what happened after that? E-Trade told me that they were powerless to stop it. They could not stop these people from trying to take money out. The only thing they could do was shut down the account, transfer everything I have to a new account with a new account number.

Wow. So not only is the scam easy to do, but the company can't even stop it unless they give me a new account. Thankfully, they agreed that it wasn't my fault and I wasn't doing fraud and so the money was returned. Actually, it wasn't even my money because I didn't have any money left over in the account. It was margin money that was taken out. So since I didn't have that much cash in my account, the withdrawals were actually made with margin. Not only if I hadn't reported this, E-Trade would have been charging me interest on top of the fraud. Right now as I record this today, it's past mid-February and I still have no access to this account. They told me they were going to shut down the old account, move everything over to a new account, and then everything will be fine.

So yes, they have done that. I can log in to the account, but I can't see anything. I can't see my positions. I can't trade anything. I can't buy anything, can't sell anything, can't do anything. Luckily, I only had long-term stock positions in this account. The markets have been moving higher. So I'm okay. But if I had options in this account or if the market started dropping, I would be powerless to do anything because I can't even see my positions. They won't let me do anything. There's only one person in the company that has the ability to do anything. I've called their customer service several times and said, "I need access to my account." They're like, "Well, your account is in security and only this one person can help you." I've emailed that person, left messages.

Sometimes she calls me back or emails me back and says, "We're still working on it. We're still working on it." I have no time or ETA or knowing anything when this is going to be done. When am I going to get my account back? Pretty much it's being held hostage for whatever reason. So I'm basically powerless. That is never a good position to be in. Now, the thing that makes this even worse, and this is why up till now you guys are thinking, "Oh wow. That's really bad, Allen, that happened to you. It's not going to happen to me. I got a really cool password." Well, remember, they didn't need my password. They don't have my password. They never had my password. They never logged into the account. They did it with an ACH and my account number.

Let's say that you're hiding your account numbers. Okay, great. You have different passwords. That is great. But let's say somebody does hack into your account. The companies that hold your trading accounts and your investment accounts and your retirement funds, if there is fraud and you lose money from that, somebody takes money out or whatever, they are not required to make you whole. I'm going to say that again. The investment accounts, like your stock broker or your mutual fund company, they are not required by law to give you your money back if you lose money due to fraud.

Now, there is a website called Consumers' Checkbook that looked into the largest firms and many of them don't even have a fraud protection policy. While some of them do say that they will cover fraud 100%, you have to live up to their guidelines which, in the case of Merrill Lynch, with Merrill Lynch, means you have to satisfy 85 different requirements, 85 different requirements. You have to be able to check off every single one of those things that you have done those in order for them to live up to their fraud protection policy and make you whole. So no, Molly, your money is not safe. Okay?

So what do you do? What can you do about it? Well, I have a list here. I'm going to give you a list. Hopefully you can listen to this. When you are sitting down, you can write these down or look on the show notes. But what you need to do is you need to have a different username and a strong password for each account. That you already know. You probably don't do it, but you already know this. Different user name and a strong password for each account, because this is money. This is important. This is not like we're trying to log into Facebook or something simple. Every single website in the world requires you to have a login now.

I mean if you're an OptionGenius member, you have to have a login and a password to log into your Option account. Now, if somebody takes your password and logs into your account, they're not going to be able to mess you up. They can't do anything to you. They can't hurt you in any way. But these accounts, it's like a vault. It's a gold mine. It's just sitting there. The money's sitting there and the hackers know this. The hackers are not going after the banks any more. They're going where the money is easy and the money is easy in mutual fund accounts and investment accounts and IRAs and 401ks. That's where the money's easy. So you have to be very careful.

Number two, you need to add something called two-factor authorization to all accounts. This is like a second password. Some sites, what they'll do is they'll text you a code before you can log in. So you type in your name, your password, and then they text you a code to your phone which you enter in and then they get in. That way only if you have your phone can you access your account. Some other companies, they use third-party apps. So they make you download a new app on your phone. There's one called Google Authenticator. E-Trade, they use an app called VIP Access. That is also two-factor authorization. You have to download a special app and then that app will give you a code. If they don't text it to you, they'll make you download an app that'll give you a code that you have to enter in when you log in. That's the only way you can log in.

Now, of course you have to use your phone. If you lose your phone, it becomes a big headache because your phone number is tied to the account. There's a whole process about that. But it's better than just leaving it open. Number three, you got to check your accounts at least once a month. Now, this you can do and hopefully you're all doing it once a month. I track my balances on a spreadsheet now as a backup. So every month I go into all my accounts, I've decided, and I'm going to put in my balance, boom, boom, boom, boom, boom. Any time there's a balance from month to month, if the balance changes a lot, I'm going to investigate. Okay, make sure it wasn't fraud. It's just, yeah, my securities are going up and down. All right. That's fine as long as there's no money going out.

Number four, when you get an email from your broker, they'll email you, "Your options are expiring," or, "This is going on. We have a message for you. We need you to log into your account for whatever reason. There's new policies or something or other." Don't click on any links in the email. If your broker sends you an email or a text message or whatever and says, "Hey, we need you to log into your account." Say, "Okay, thank you." Go into your internet browser. Type in the name of your broker, whatever it is, broker.com, etrade.com. Ameritrade.com. Go to their website and log in from there. Do not click a link in an email or a text message or any other communication because scammers and hackers send emails that look like they come from your broker, but they will take you to a fake website that looks like the real website.

You're going to try to log in there and they're going to grab your login information. So that's number four. Number five, do not log into your account on public WiFi. Do not use public wireless Internet. So if you're sitting at the airport, if you're at the hotel, don't do it. You can use it for your phone if you want to and check your email or check your whatever messages, Facebook and emails and news or whatever. But do not log in to any accounts that are sensitive. If you have to log into those, use your own cellular data plan if you have to. Number six, obviously, do not share your login information with anybody. Do not share your account number if you don't have to.

If you have a mortgage application and they need to know what money you have and what assets you have, write down, okay, I have E-Trade account and two digits of the account number. They don't need to know your account number. Nobody needs to know your account numbers. Even E-Trade doesn't ask you for your account number when you log on. They only ask for part of it. It's like a Social Security number. Do not give out and do not leave it laying around. Shred all of your statements if you get them in the mail. If you don't need them any more, shred them or keep them under lock and key. Keep them safe. Keep the information safe.

Number seven, this was a new one to me. Do not give your investment details to sites that help you track sites like Mint or Quicken or Personal Capital. These are basically websites that tell you, "Hey, you can track all of your accounts just on our site. You can track all your bank accounts. You can track all your investment accounts and you can see how you're doing." Well, guess what? If these sites are hacked and they lose your information, your investment, your stockbroker doesn't have to cover the loss because you knowingly gave your login information to a third party and that third party got hacked.

So your broker, as far as your broker's concerned, it's their fault. They didn't get hacked and so they don't have to cover the loss. I hope you understand that because a lot of people use these sites, Mint, Quicken, Personal Capital, and there's a whole bunch of other ones. They might make it easy for you to track all your credit cards, all your bank statements, all your investments in one spot. But if they get hacked and your personal information, your login and your password gets stolen and somebody uses that to log into your investment accounts and take money out, your broker is not liable and is not responsible and might not make you whole.

Number eight, again, shred all documents if you don't need them. We already said that one. Now unfortunately, things are only going to get worse. If you haven't been hacked yet, you will be hacked because thieves go to where the money is and there is more money sitting in mutual funds, 401ks, HSA plans, and investment account than ever before. It is not as secure as the bank. If you have a checking account or a savings account, it's guaranteed by the government up to a certain amount. If somebody hacks you or the bank goes out of business, your money is protected by the government, not so with your retirement funds. There is no government agency that is going to back you up if there is fraud because it is very expensive to keep these hackers away and to keep refunding customers' money.

Only the larger companies, the very big companies, can afford the top-of-the-line security that they need to keep these hackers out. Even then, they still get hacked. E-Trade, big company, right? They just got bought for $31 billion. That's what they were worth. They got hacked easily. So be very, very careful, especially if you use a smaller firm. Check what their fraud prevention is. Some of them say if there's fraud, they'll back you up 100%, like Merrill Lynch. But you have to live up to 85 different requirements, which is insane. The best thing to do is to protect yourself from being hacked in the first place.

Like I said, I already gave you eight different things that you can do. Make sure you get that two-factor authorization in place. Make sure you have strong passwords, different different passwords for different accounts. That's the easiest thing you can do. Check your accounts on a regular basis. Make sure there's no money going out, and just be careful. Be mindful of what's going on. I'm going to leave some links in the show notes for more information on this, on what are the things you guys can do to protect yourself. But like I said, if it happens to you, it's a pain in the butt. Because it happened several months ago and I still have no access to my account and I didn't do anything wrong.

I don't know how they got my password or my account information. They didn't get my password. I don't know how they got my account information, my account number. Maybe they just guessed it randomly. I don't know. E-Trade couldn't figure that out either. The only thing they could do is give me a new account. Okay. Well, how long before that happens again? I mean I still haven't decided if I'm going to move my funds away from E-Trade because of this. Probably I am. But every other broker is the same thing. They all have similar systems. I wish I could go to Ameritrade, but my Ameritrade was hacked. Luckily, nothing happened there.

So yeah, I'm taking a lot more precaution than I was doing before because I mean, imagine you get hacked and your bank says, "Well, hey. We not going to cover you." What? For me, it was $15,000. For other people that could be a lot more or less. It doesn't matter. It's still hard-earned money that we've made. We try. We work hard. We invest. We trade. We do our best. And then the money's just sitting there and it's just gone. They have no idea how to catch these people. They're sitting who knows where. Maybe they're in Russia. Maybe they're in some other country. They're just hacking, hacking, hacking.

Nobody can find them. And even if they know where they are or who they are, our government can't do anything. Our government's not going to go after them if they're in some country that's on good terms with the U.S. So there's nothing really we can do about it to stop it, except to protect our accounts a little bit more. I hope that you follow the recommendations laid out in this episode. I hope this episode is a wake-up call. I hope I can grab you by the shoulders and shake you and say, "Look, it happened to me. It can happen to you. It can happen very easily to you." Please be careful please. It's going to happen.

It's the same thing with identity theft. It hasn't happened to me, thank God, but it has happened to other people I know. It's a matter of time before somebody hacks into my email or somebody guesses my Social Security and steals a credit card or does something. That's just the nature of the world we live in. The more that we go into electronics and the more we get away from real money, which we don't even use that much any more. Everything is online. Everything is on computers. We're just sitting ducks. That's exactly what your investment account is. It's a sitting duck for hackers and scammers. So put some walls around your duck. Put some safeguards in place. Be as stringent and careful as you can. Hopefully, it doesn't happen to you.

I always tell you to trade with the odds in your favor. Well, this time we need to protect yourself. I don't know if we can ever put the odds in our favor in terms of protecting our accounts, but we need to do as much as we can. So with that said, I hope this never happens to you and I hope I get my account back soon. Until then, may the markets be great. Thank you.

https://www.usatoday.com/story/money/2020/01/14/401-k-retirement-accounts-targeted-online/4453891002/

https://www.checkbook.org/puget-sound-area/identity-theft-protecting-your-investment-and-retirement-accounts/

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  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
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Feb 25 2020

24mins

Play

A Decade To Freedom - 62

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

Every single day you get older and older, and this is not something we can stop, but it is something we should be taking advantage of. And that's what I want to talk about in this episode. 

It's already 2020. Another decade has come and gone, and it's fun sometimes to sit back and say, "Wow. You know, where'd the last 10 years ago? They go by so fast." Oh, geez. 2010, man. I don't remember everything about 2010. It just seems like the older we get, the less we remember. But 2010, I had to write this down. I had no kids in 2010. Now my oldest is nine, and then we have a seven-year-old and a three-year-old. And I really cannot remember what it was like before them. That's a crazy thing. That was only 10 years ago. But they've changed our life in so many crazy ways that it's unbelievable.

2010 was also the beginning of Option Genius. Option Genius was started in 2009. So it only was about a year old, and I was just getting started with a couple of hundred members, and doing iron condors every day, every month, and just really had no clue. But I mean, we had no clue as to how to grow the business or where it was going to go. At that time, it was just going to be one website, kind of like a lifestyle brand or lifestyle company that I wanted to just use, and earn some extra money, and stay busy. Because I was trading options full-time, making money from it, but wasn't taking very long, and I was getting on my wife's nerves. So she told me very bluntly one day that, hey, you need to go do something otherwise because you're driving me nuts, and that's what she told me. So that was the reason for the birth of Option Genius. And of course, I wanted to help people, so that's awesome too. But really, it was her push that I needed to do something else with my time that led to the creation of Option Genius.

Now, at that time, we had one website, one membership. That's all I was going to be. Now we have three memberships. We have two full-scale, very large courses that stand on their own. We have e-books. We have other products that we sell. And I have my Passive Trading book coming out. Still working on that one. Hopefully it'll be out soon. I know I've said that many times, but I'm still working on it. Want to get it just right, but I think maybe I should just get it out before it's going to be another 10 years and I'm still saying the same thing that I'm still working on this book and it's already been two years. Two years that I have been saying that. So I promise to get it out soon.

What else? 10 years ago, the U.S. Was just coming out or still in the midst of the great recession. Lending was tight. It was hard to get a mortgage. It was hard to get a loan. It was hard to buy anything on credit. People were scared about what was going to happen to the future. Stock market was kind of ... You know, who knows what it was going to ... Nobody knew. Nobody could tell what was going to happen, and politics was all going nuts. Everybody was fighting, and just a big mess.

Now, 10 years later, I take a look at my own self, we have the three kids, changed our lives completely. Financially, we're much stronger. We're much better off in much, much better position than we were 10 years ago. My five fingers are growing. And if you don't know what I'm talking about when I say five fingers, we do have a podcast episode that we did earlier on that covers that. Basically, in a nutshell, it's you got to have five different streams of income that are independent. So if one of your fingers breaks or two of them break at the same time, you still have three that are working and generating income for you while you regrow the other two.

My passive trading is doing wonderful. I'm moving more and more towards that. My oil options trading is doing great. I'm very, very happy with those results. Keep learning, keep trying to do new things with that as well. But I keep seeing that the more I try different strategies, the more I try to mix it up or to improve it, it just changes it up. So I got to go back to the basics. Then, the way that we do it is the way that's been working. So even though we tried to improve this ... Okay, can we modify this? Can we change this amount? And we'd do backtesting on it. We find out that the original, the way we're already doing it is what's working the best. So I'm happy about that.

My income from investment is growing considerably because the money that I'm getting ... Thank god we have enough to survive. My family, we are not big spenders. That is something that was ... I was very blessed with a wife that knows how to save money and knows how to be prudent with her money. So when she wants to buy something, she can go out and buy it. That's fine. She does. But she's not into name brands. Neither am I. We're trying to get our kids that way. She's not on top of the latest fresh and trends that she has to have a Gucci bag or a Prada bag and everywhere she goes, and she has to have 20 different kinds of bags, and she has to have matching shoes for every outfit and all that stuff. She looks good, but she does it without spending a lot of money. So thank god for me, right?

So our expenses are lower than what they would normally be for a family of five. So the money that is saved then goes into other investments. So we've started to invest in other people in terms of people who are starting companies that people that we know or people that have cause that we would like to see. So we're investing in those types of businesses, and the returns have been good from that as well, and that's growing and growing.

It's really interesting because the growth or the changes of my mentality over the years is something that I haven't really talked about. But when I started, it was all about I have to make enough money to pay the bills. Pretty much desperation. Now, my wife was at the time was working two jobs, so she was making enough to cover the bills. But being the man of the house, your masculinity is at risk when you're not bringing home the bacon.

Now, I know that is changing now and there are a lot of guys who are stay-at-home dads, and that's wonderful. But in my household, my wife didn't want to work. She wanted me to do the job. She wanted me to make the money, and she wanted to not have to work two jobs. So it was on me to, hey, at least pitch in, at least they have the bills. I wasn't paying anything because I was laid off, and I was losing money, in fact, from my trading. So that was my first goal to, hey, start making some money, help around with the household expenses. And then eventually it got to the point where I was able to pay for all the expenses. Then, she quit one job. Then, later on she quit another one. Then we had the funds for her to actually go and start her own business, which is doing very well. So that was a good succession, and she was happy with that. Thank god.

So my thinking shifted, right? So it went from first off to being in a mode of desperation, being in a mode of, okay, I need to pay complete attention to this, I'm going to do this nonstop 40 hours or more a week because I need to pay the bills doing this, and so I was on top of my trades. I was learning new strategies. I was backtesting. I was staying on top of the markets religiously. And then eventually, slowly, slowly, slowly, I got the confidence to know what I was doing to get better at my trades, to pick the strategies that worked for me and to really hone in on those strategies and to get better and better and better to the point where then I was comfortable again.

I got to the point where, yes, okay, I have a certain amount of money coming in. I am pretty confident that that money's going to continue, and so now I can take my foot off the gas and I can kind of relax a little bit. That's when I got to the point where, okay, I'm chilling. I got money coming in. It comes in, and I spending a little bit of time on them. Still am working and staying on top of the markets but not like I was before because now I have a cushion. Now I have enough of a larger enough trading account where I can be relaxed. And even if I go a month and I lose, I still have the money where I can still generate income from it, and still take out the money, and still be okay.

So the stress level, completely different stress level. Completely different mental game at that point. Now it was how could I maximize what I have instead of oh my god, oh my god, if I don't make money I'm going to not eat or whatever, whatever the case is. You don't have to borrow money from my father-in-law to pay the rent or something like that. So that was a complete shift. Mental, emotional, confidence-wise, I was a different person from being a failure at trading to now being actually living the life that I had always dreamed of living. Then, that's when my wife pushed me to start Option Genius. Then I got into ...

Basically, I saw myself as a new role. I saw myself as a new person where I was like, "Anybody can do this stuff. Just go ahead and do it. Just learn it like I did." But I found that people needed a lot more handholding, for whatever reason they didn't believe it, or they didn't have the time, or they didn't have the resources to put the time in to learn it. So I think that Option Genius has helped thousands and thousands of people over the years because we've gotten all the emails, we got the testimonials, we have videos of people thanking us, and it's been really a blessing to me. I know I've been trying to help other people through it, but it does provide income and it does provide me with a satisfaction that I'm actually making the world a better place.

Because when you're just sitting there selling options, it's great. It's great money. And I feel good that I can make money and I can provide for my family. But I'm not really helping the world very much. I'm not really changing the world. I'm not out there helping little old ladies cross the street or something that would really charge your soul. Yeah, you can take the money and you can go out and help people. You can feed the homeless. You can adopt a child or something. But if you're only in front of the screen and you're just sending out checks, you don't have that same feeling of actually going out and doing it.

So by selling options, it's not like you're a public defender. If you're a lawyer, you go to law school and then you actually go and you try to help people that are innocent and you try to get them off. That is you're using your skills to make the world a better place. I didn't feel I was doing that by being a trader. If I didn't sell these options, maybe somebody else would, or maybe it wouldn't even be necessary. But I found something where I can actually go and take income from it. Okay, it didn't help make the world a better place, but it hit and served my needs. So that was great.

But now I was getting bored. I got to the point where like this is fun, but now I'm bored. So my wife told me, "Go get a business. Go start your own business. Go help other people," so I did that. So that, it's been a complete blessing. So that was a new phase of my life. So first we had desperation phase. Then we had confident trader by myself phase. Then we had, okay, now we have a company where we're actually have people working for me and we have people that we're helping as members and students, and people asking questions, and me be able to respond and share my knowledge, and not really being a leader in a sense but being more like a teacher or an educator. And that really has helped me feel good about myself in that role.

But as time went by, that was great. That was a great aspect. But in terms of my trading, I realized that I don't want to be spending even the time that I am spending on my trades. I mean, you can be doing iron condors. You could be doing butterflies, and calendars, and these type of strategies, and you can dive into the weeklies and you can generate very, very good returns. Whenever we do a butterfly spread, my target is 20% return on that trade. Iron condors, we're looking around 12%. Weeklies, we're looking for 5% a week. That's a lot of money if you can do it over, and over, and over again, which is what we try to do. So that requires a certain amount of time where you're staying on top of it.

Now, my ultimate goal in life is not to be a trader, if that makes sense. I'm using trading as a vehicle to get me from point A to point B. But when I get to point B, I might not need the vehicle anymore. I will probably always trade, but I'm not going to be trading for a living anymore. I'm not going to be saying, "Okay, I need $12,000 a month to pay all my expenses. That's how much money at least I need to be making from my trading account." I won't be there. I'll be having my five different, at least five different, streams of income, and I won't have to worry about if I don't trade this month, how am I going to pay the bills. That's where I want to get to. That's where I'm moving towards.

So how can I get to that point where I can pay my bills or increase my accounts without having to spend so much time monitoring the markets and looking at what's going on? So that is what I've been working on for the last couple of years. So okay, I know option trading can get me there to the point where maybe I'm just spending three, four hours a month, maybe five hours a month maximum and I'm still earning really, really good returns that's better than anybody else can get or any other investment. But I don't want to be spending 10, 15 hours a week. Does that make sense?

So I got to the point where I have money coming in. I want to go out and actually do good with that. I want to get to the point where I'm the one feeding the homeless person, not just writing a check for them. I want to write the check, too, but I want to be able to go out there and actually feed the homeless person, and shake that person's hand, and talk to them, and see if we can help them or whatever. There's just an example. Whatever the issue is. But I want to be the one that can actually go out into the world and make a better place. And if we build a school, I want to be able to go and visit the school and be involved in the process of picking the location and seeing the kids go there. I don't want to be a teacher or anything, but I would like to be able to go and visit it from time to time, even if it's in another country somewhere off in the mountains or something like that.

So that is the ultimate what I want to get to. So when I start my foundation, and I've been talking about this for a while, I'm still in the process, my goal is to be able to work on the foundation and be able to help in certain areas that I would like to participate in. So in order to do that, you have to study. You have to research. You have to talk to people. So I believe that I'll be able to get access to certain conferences. Or if you call up the university and you say, "Hey, I want to talk to so-and-so professor about something," if you just say, "I'm Joe Schmoe," they probably won't put you through. But if you say, "Hey, I'm calling from XYZ foundation, they'll be like, "Oh, okay. It's a donor. Get that guy, get the professor on the phone." So that's the whole point. That's why I came up with Passive Trading. That was the whole idea behind it, whereas we want to have something that is stable, reliable source of consistent monthly income.

Another aspect that has bothered me for years after the great recession and the financial debacle was that there were a lot of people at that time that were trading iron condors and certain strategies. Then after or during the recession and afterwards, the iron condor, the way everybody was doing it, just didn't work anymore, and so people were lost. People kept doing what they knew without changing. They didn't realize that the market had changed. They saw that, hey, before I used to put on an iron condor and I would only have to adjust it maybe 6 or 7 times out of 12. Now I'm putting on my iron condors and I'm adjusting it 10 times out of 12. They noticed that part, but they didn't realize the reason why and that the market had changed and so they needed to change their strategies along with it.

So that bothered me. It's like, "Okay, these people ... " And I was doing the same thing. I had all my money tied up in options, and I was selling options. But the point is if you have a large move in the market, and, let's say, you're using 70% of your account, if you're doing iron condors, or spreads, or whatever it is, if you're only trading in options, if you're only doing options, and there's a large move that catches you off guard and it goes against you, there's a good chance that you can lose 70% of your account or whatever percentage you have in your trades. You could lose all of that. Even if the market comes back, once it's gone, once that trade is over, once it expires, or once you get out, it's gone. That money's gone. It's very hard to recover from.

Now, this is unlike stocks, right? Where if you buy a stock at $100 and it drops to $50, yes, you've lost money, but you can still hold onto that stupid thing until it comes all the way back up to a hundred hopefully. Does that make sense? So with the stock, you actually have something that doesn't expire. With the option, we're selling them because they do expire. But my point here is that the stocks can act as a foundation for your option trading portfolio. So if there is a drop in the market and your option trades do lose, you still have your foundation.

What I found out was that when the markets dropped, a lot of option sellers would lose all their money and they'd be blow up their accounts because they didn't have a foundation. They didn't have a way to bounce back. They didn't have any rock solid thing on the bottom that was still there that they could build off of. So part of our Passive Trading Formula, and that was part of the thing that I came up with first, say, "Okay, if I'm going to be a trader, I have to be able to withstand all the ups and downs." Because the great recession was they say once in a lifetime. I don't know. I don't know if the stock market is going to drop another 50%, or 60%, or 70%. It could. And if that happens in one day, or one week, or whatever, a lot of my option trades are going to lose money because that's unexpected and is huge. So how would I recover from that if that did happen? That's the biggest thing that a lot of options sellers don't think about.

Well, in this particular situation with the great recession, stocks stopped like 50% or more, but then eventually they'd recover, and it took ... Some stocks recovered within three years, five years. Some took 10 years. But they did recover, most of them. And in the meantime while they were recovering, option sellers were able to rent them out and sell covered calls on them and naked puts on them. So the people that had that foundation, number one, they didn't freaked out as much. Yeah, they lost money and it sucked, but they were able to build it back. And number two, which is even more important, they didn't blow up. They didn't lose everything.

So as the next 10 years go by for you ... I mean, it'd be a good experience to just sit down and say, "Hey, where was my life 10 years ago? What were my goals back then? What was I thinking back then? And then where am I now?" So take a just like I did earlier in the episode where I sat down and said, "Okay, I didn't have kids, and this and that. This was happening. That's happening. Now where am I now?" And it's like I can't believe how much has changed in 10 years. I'm sure in your life it's probably the same thing. Hopefully it is because there's ... Tony Robbins has said it and other people have said it before him that we as individuals, we overestimate what we can do in one year, like, "Oh, yeah. In one year I want to be a billionaire." But we underestimate how much we can do in 10 years. Because if you take small actions every time over and over, and those small actions, they compound on each other, and they grow, and they grow, and they grow, and the results are crazy.

So I would like you to take a few minutes if you haven't done it already ... Maybe you did it for New Year's as an activity or whatnot. But think about where you were 10 years ago. What were your dreams? What were your goals? What were you working towards? What situation were you in? Look at them now. If things have not changed, then we need to take more action. We need to set better goals, more realistic, reliable goals. If you haven't done any goals at all, you don't know where you're going, you're going to be lost. You have to have something. You have to have some direction, right? You have to have some desire of what you want, and then you have to take action to get there. So if you haven't had any changes in the last 10 years, something is very, very wrong in that situation. Maybe you and I need to talk. Maybe I can talk some sense into you. And I would love to help you, okay?

If you're like most people and you had some growth, some things have changed ... And I'm not saying all of them are going to be positive. In the last 10 years, my wife and I, our family, has had two very major, major losses that I didn't talk about until now. My wife's best friend and our best friends, really, they both passed in a very violent, traumatic way. It was a murder-suicide. And that still haunts me and my wife because we were so close and we didn't see it. It happened, and it affected us in such a major way that it kind of derailed us for a couple of years. Then just recently, my wife's father having been shot and killed at his job. So you're going to have the good and the bad. That's just part of it. People are going to pass. Businesses are going to fail. People are going to get laid off. Kinds of things are going to happen. Divorces will happen. Life happens.

But take a look at where you were 10 years from now. Take a look at where you are now. Then, think about where you want to be in the future 10 years from now. Making goals just one year out, that's great, but you can do a lot more in 10 years than you can in one year. And I don't even think 10 years ago I would not have even imagined the kind of success and the life that we're having now as we 10 years ago. It would've been like, "Yeah, maybe 20 or 30 years from I'll have some kids and I'll be able to do this and live like this." Well, no. That happened in the last 10 years.

So the dreams that you have, they can be accomplished in 10 years. I think that trading options, passive trading is an amazing, amazing way to help you to achieve your goals. This is what I want for you, and this is what your assignment would be for this episode. Look back 10 years, look at now, and then look at 10 years in the future. Where do you want to be 10 years from now? And how are you going to get there? Then, what actions are you going to take to get there? Because if you don't do anything different than you're doing now, then life will just meander. You'll just go along that dah, dah, dah. The time is going to pass. The years will pass, and you will be looking at 2030, right? 2030's going to come whether you change anything or not. But if you want things different in your life, if you want certain things in your life, then we have to take the right actions to get there.

So that's it. That's the episode. That is the homework assignment. And if you want to take it one step further, I would say email me your goals for the next 10 years. Help@optiongenius.com is the email address, help@optiongenius.com. Send me your goals. I'm not going to share them with anybody. I'm just going to keep them. If I can help you accomplish them, that would be great. If you need any from me, let us know. We're here for you. And who knows, maybe we can even accomplish some of our goals together. Maybe if something of yours aligns with mine, maybe we can do it together. Who knows. But that's it. That's your homework assignment. And may the next 10 years bring you all of your dreams. Remember, trade with the odds in your favor. Take care.

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
  3. WATCH THIS FREE TRAINING: https://passivetrading.com
  4. JOIN OUR PRIVATE FACEBOOK GROUP:  https://optiongenius.com/alliance

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Feb 16 2020

23mins

Play

Overcome the Fear of Losing Money - 61

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer.  

--

We're going to talk about something that is downright scary.

FEAR

Has the fear of losing money stopped you from trading or made you trade in a way that led to losses?

If yes, you are not alone.

Fear is the one thing that stops humanity from achieving our highest potential. And everybody has fear. Every trader is afraid of losing money on every single trade.

On this episode, I share an exercise that I have used in the past to help traders get over their fear of loss.

It takes just a few minutes and it can help you overcome your fears and get you back in the game.

https://optiongenius.com

https://passivetrading.com

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
  3. WATCH THIS FREE TRAINING: https://passivetrading.com
  4. JOIN OUR PRIVATE FACEBOOK GROUP:  https://optiongenius.com/alliance

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Feb 07 2020

30mins

Play

Case Study: How To Make 168% Returns in One Year - 60

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

What would a good yearly return be for you? What would you be happy with? 10%? 15%? 25%?

Our goal at OptionGenius is to make 10% a month. We don't always get there and we sometimes lose money but even if we average 5% a month, that is a great year.

Well in 2019, I made 168% and in this episode I want to share how I did it and how you can do it too, and why I think that 2020 will be just as good a year as 2019 if not better.

https://optiongenius.com/oiloptions

--

LOVE ALLEN SAMA - OPTION GENIUS AND WANT TO LEARN MORE TRADING TIPS  AND TRICKS? HERE ARE SOME NEXT STEPS...

  1. SUBSCRIBE TO OUR PODCAST
  2. FREE 9 LESSON COURSE: https://optiongenius.com/
  3. WATCH THIS FREE TRAINING: https://passivetrading.com
  4. JOIN OUR PRIVATE FACEBOOK GROUP:  https://optiongenius.com/alliance

Like our show? Please leave us a review here - even one sentence helps. 

Feb 04 2020

18mins

Play

The Tale of Two Traders - 59

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People literally ask me this one question ALL THE TIME… “Allen, how did come up with such a lucrative, safe, and easy way to trade?” I explain it all in my new book Passive Trading, get your free book here https://www.passivetrading.com/free-book!

Option Genius was built with you...the individual trader, the breadwinner, the dreamer, the rock your family depends on ...in mind. Because we know what it takes to become a successful and profitable trader. And that’s exactly what we help you do best. Get your $1 trial of Simon Says Options, our most conservative and profitable trading service here https://simonsaysoptions.com/stockslist-ss-trial-offer

--

This episode is called, The Tale of Two Traders because, well, this week I was able to talk to two different students that are in our Passive Trading Formula course. And they both had opposite stories and they both had opposite results. And I want to talk to you about their results and how you can avoid the one and get the other one and why there was a difference, even though both of them were very smart, both of them had similar experiences and they were similar demographics, everything was very similar. I mean these two traders, both of them had some experience with options before they jumped into the passive trading formula course. They were both motivated and excited and they watched our training about it and they decided, "Yeah, this is something I want to do." So they took the plunge, they got in.

One of them, we call him trader A, he was excited and then he emailed saying, "Hey, I'm having some trouble." And so I got on the phone with him and basically he was... What's the right word? Maybe discouraged or disillusioned, maybe that's the word. Because basically his major complaint was... He hadn't done anything, and his complaint was that the course only had eight modules and a group. And that's not enough to actually teach somebody how to trade or not. You need a lot more information, you need a lot more content than that. You need a lot more. And he rattled off some things that he wanted to know exactly what I was doing and that's what he was promised. And it's true when I explain the course and what's offered in the course, I tell people that this is what I do on a day to day basis. And I guess that wasn't enough for him.

The other trader, we call him trader B is in the same course. He's been in the course for about a year now. And so he contacted and I wanted to talk to him and he has, I mean he's ecstatic. He's jumping up and down pretty much. I could hear the excitement in his voice. He has made over $114,000 this past year from what he learned in the course.

So trader A, trader B, same course, same information, one guy decided, "Oh, this is nothing is not worth it." The other guy decided that, "Oh, I'm going to use this." and he made over $100,000 or $115,000. That is nothing to scoff at that. That is nothing to be like, "Yeah, well maybe it's tip money." No, it's not tip money. It's a full time income. And he didn't even spend full time doing it, right? He spent a few minutes a day looking at his trades. He did a bunch of trades, but it didn't take that long as a full time job or even a part time job.

I mean, I don't understand what other part time job you can get that'll pay you $115,000 a year without any stress. Really, not that much. Trading has some stress, but not really as much as I'm full time job with customers yelling at you and a boss and all that stuff and getting to work on time... No, none of that stuff. You work in your pj's, that's fine with me. I like that. In fact, I'm wearing pajamas right now in the office. Actually, they're not pajamas, but my wife calls them pajamas. They're kind of like sweats but they're like 15 years old. So that's my uniform, that's what I wear to work. And I know some of you are jealous of that because you have to dress up in a suit and tie and shave every morning and all that stuff. And don't hate me because I'm lucky or don't hate me because I found passive trading. You guys have found it too, now you guys can get on board as well.

But my point is that you have two people and I asked them the similar questions. I said, "Tell me about yourself. Tell me about your background. Tell me about what you know, how much money are you playing with? How much do you have to invest? What's your knowledge? How long you've been doing this, playing the trading, the markets and options and all that?" And they were very, very, very similar. They lived in the same part of the country, they had the same amount of money to work with. They even worked in similar jobs. I mean it was crazy. One had two kids, one had one kid, but they were both older kids, so they didn't have to worry about them. Very, very similar demographics, very similar people.

But the mentality was different. And there are three reasons and there are three things I need you to write down if you have a pen and paper or just remember these three if you're driving or exercising or whatnot. But the first thing that I think made the huge difference between the two of these guys is one of them took action and the other did not. And I think that comes down to it, that's it. If you do not take action, you are not going to get any results. $115,000 a year, great results. What did he do? Well, he went through the course and he did it step by step like I tell them to do in the course. I'd like [inaudible 00:05:39] them to do all the modules and do the homework assignments, put on some trades and then pick a strategy out of the many strategies that we talked about in the course. Pick one of the strategies that works best for your situation right now. And we even tell them how to pick the best one for their situation.

And so once he did that, he went through the different courses, he asked questions while he was going through and he said, "You know what, I like this strategy. I'm going to pick it." And he did it and he's followed it the way it's described in the course. He didn't add his own rules, he didn't change anything. He didn't add his own information or his own knowledge. He just went by, he said, "Look, Alan said this is going to work. That's what I'm going to do." So that's what he did. And the results speak for themselves. I don't know what else to say it or how to say it.

You have trader A, his complaint was there are only eight modules and a group. Yeah, but I asked him, "How much of the eight modules did you implement?" And he says, "None of it." Well then it doesn't matter if there's eight modules or if there's one module or two modules or a hundred modules. If you don't go through the information, if you don't use the information that's already there, then what's the whole point? Right?

The whole idea is to keep it simple. How do you make something passive that doesn't take a lot of time? Well, if you're going to have 50,000 rules to it is not going to be simple and it's not going to be passive. That's why I wanted to break it down as much as possible and say have his few steps so that you really can't screw it up, right? I mean that's the point. We want to live our lives. We don't want to be stuck in front of a computer.

And so I didn't get it. I mean the modules themselves, I mean I had another person point this out to me, he goes, "The modules are two or three hours each." So I mean, eight modules times even two hours is 16 hours, that's a lot of time, okay. That's a lot of material right there. I mean, I realize, "Okay, wait, this year we're going to have to go in and we're going to have to cut that up. We're going to have to streamline that stuff because even that is just way too much." We want to make it as simple as easy as possible and say, "Hey, this is why we do it. This is what we do. This is how he follows directions, step-by-step, boom, boom, boom, boom. These are results you're supposed to get." And that's the way it's supposed to be.

But unfortunately this fellow, it's like, "Oh no, only eight modules. I want a lot more." Well, no, you don't need a lot more. Number one, you shouldn't get more because that's going to give you even more reason to not do anything, right? I mean, if you want to find an excuse, you're going to find an excuse. Obviously this guy's excuse was not enough information. Now on the other hand, if there was too much information, then you'd find an excuse there. So I'm like, "What is the answer" I asked him "What is the right amount of information that you want?" And he didn't have an answer because he doesn't know. He's just looking for excuses of why he shouldn't do it. So he can chalk it up and say, "Oh no, this system didn't work." Well you didn't try it. You didn't do it. So how do you know?

Obviously it works because I got the guy I talked to right after him, making over a hundred grand. So where's the problem? It's working for me, it's working for everybody else, it's working for other students in the class, we have so many other testimonials. So maybe the problem is not the material, make sense? I think so. So that's number one, action, when you don't take action.

Number two, you got to have some belief. Obviously trader number one, A did not have the belief for whatever reason, trader B had the belief, but I think that part of the reason that trader B had the belief is that he went through the course. He went through all the modules, he heard me talk, he heard the examples, he saw them, he worked through them, he did the homework. When you do the homework, you actually have to put on a trade and walk it through and see how it does. I mean, you could not believe anything I say about anything, about selling options, or even if there's something called options. You can totally not believe me at all, but when you actually have to sit down in front of your screen, go to your software for your broker, put on a trade while you sell a option, and then watch it day, by day, by day and see what happens, you realize that, "Oh, maybe Alan knows what he's talking about. Maybe this stuff does work." Because the [inaudible 00:09:30] I can't make that stuff up, that happens, it's real.

The problem is you don't know how to use it yet. That's why you haven't had the success yet, but the belief comes by integrating yourself into this. The belief comes by listening to these podcasts episodes where I'm talking about it and hopefully I'm pounding you over the head every month or every episode, that hey, "You need to sell options, you need to sell options. This stuff works, this stuff works. We got lots of success stories. We've got lots of examples, just look at our track records."

In 2019 one of our other strategies where we sell oil options made this, made a whopping 168% return in a year, in 2019, 168% return just by selling options. Some people say, "Oh yeah, selling options you're making nickels." No, you're not it's 168% for one system, following the passive trading formula course this guy made $115,000, this is not nickles we're talking about. This is some serious money, right? So you have to have action, number one. You have to have belief, but even if you don't have the belief, you can get the belief, right? I can force you to get the belief, if you do the work, if you take the action, if you just do what it steps in the steps, follow one by one. Look at the module, look at the examples, put on a trade, ask questions.

That's why we have the group. We have a group so you can ask questions. You can say, "Oh, I'm trying to do this trade." And we've had people do that. They take a screenshot of a trade and say, "I don't understand this." And we point out, "Oh, look this was wrong, this was wrong, this is wrong. You do it this way, it'll work out." And then they look at it, they say, "Oh..." Light bulb goes off. "Yes, I misunderstood it. Thank you." And then they do it right and then they see and then they get ecstatic and they're like, "Whoa, I did this."

This has happened to one of our students right now, I forgot his name, he actually posted not too long ago, he was doing credit spreads and he did it wrong and so we helped him out. So he fixed it and then a month later he reports, "Oh Hey, I made my first two positive trades." Awesome, that's the whole thing. That's why we're here. That's what I love to see. I love to see people getting it, having a click, having them be like, "Success. Yes." Because if you can do it once, you can do it twice, you can do it a hundred times, but you got to take that step. You've got to go in first, right?

The third thing you need is the desire. This is your why. This is why it has to happen now. Obviously trader A, I asked him, "Why are you trading options?" "Oh, I want to make more money and I want to retire early, and I need to pay off some debts, and it would be nice to have extra money to go on vacations, and this and that." Okay, cool, but obviously the desire was not strong enough for him to take action.

It's kind of like the story about burning your boats. I don't even know if this is true story, I've heard that it is true, I heard it isn't true but there was one group that was attacking another group and I think it was the Romans or the Greeks, I don't remember. But they took their boats, they landed on the beach and then at night they burned all the boats and the next morning they were going to go fight. And obviously if you burn all your boats you can't go home. So if you want to live you're going to have to fight really well because you either conquer or you die, you ain't running home. There's no retreat.

And sometimes that's the way it has to be in life. And your desire, your why, your reason being, your reason why you want to trade, your reason why it has to work, it has to succeed, that has to be so burning, burning, burning inside you that there's no other options, there's no other alternatives. And if it is, then you will find a way. And I think that whether you believe in this or not, I think the universe contrives to find a way for you once you put it out there, once you think about it, those brainwaves go out into the ether, go out into the universe or whatever and the answers come to you. They're attracted to you.

I've seen it in my life a million times. You can call it whatever you want. You can call it the secret. You can call it the law of attraction. You can call it miracles. You can call it faith. You can call it a religion, God, whatever you want to call it. But I've seen it happen over and over and over and over again in my life and many other people's life. You might've seen it too. If you want to test it, then have that burning desire. You got to have it. You got to burn. It has to burn inside. It has to hurt so much that you want this particular thing that you will not make any excuses, you will not falter, right?

Trader A did not have that. He couldn't even take the first step, in his mind it was, "This is not going to work." Instead of, "I have what I need, it has worked for other people. Therefore it can work for me because there's nothing wrong with me, right?" And there's nothing wrong with you. If you can understand what we talk about in the training that gets you into the course, then you can understand the course and it doesn't matter how newbie you are to options. Maybe you've never traded options before. This course was made with you in mind, right? It's not for somebody who was already making a living trading options. It's for the person who's getting started or who's not successful at it, and that's who this guy was. He was trying to trade, he knew some of the stuff, but he wasn't successful at it, so that's why we break it down step by step. This is how you do it. This is back to basics. This is how you become successful.

Because what he needed was belief. What he needed was some confidence in himself, but he just couldn't get around to it because he hadn't put on consistently winning trades and he wasn't willing do the work, which boggles my mind. You tell me that, "Hey, I want to succeed." You tell me, "Hey, I'll do whatever it takes to succeed. I'm going to put up money to join a course." But then you make excuses and you don't put up the time. Now, I got to admit, I've done that in the past, right? I've taken courses, I've been like, "Oh wow, this is great. I want to do this." And then life gets in the way. In this case, it wasn't a factor of life getting in the way. It was just a factor of this guy did not have the three things that you needed. He didn't even take any action. He didn't have any beliefs, he didn't believe in it. And he had lackluster desire, right?

If you don't have a full desire, if you don't have belief, but you have action, you can still succeed. If you take a little bit of action because of your desire and you still don't believe you can still succeed. Or if you have belief and desire but no action, you're not going to succeed. So out of those three, action, belief and desire, you got to have at least action. If you have all three of them, then your super power, you're going to be making money in no time, you're going to succeed no matter what. That's all it boils down to. And so that's the purpose of this particular episode.

And if you want to know how the trader B succeeded, well then you can join us in the passive trading formula course. You can go through exactly every module that he went through, every homework assignment that he did, and then we'll be happy to introduce you to him in the course. Because he's in the Facebook group, he's in the group, he's in the community, he's answering questions, he's helping people, right?

So it's all about action, belief and desire. And we've talked about these three things before, but it was just insane how closely related these two guys are. How close they are to each other. And you have one taking action and one just not. And the difference is astronomical, right? Because if you can make 100,000 in a year, you can do a lot more than that. And every year you can compound it and grow it and grow it and grow it. And then what? The sky's the limit. But if you don't take any action and you start blaming other people for your lack of action, then you're going to be the same. Actually, you're not going to be the same. You're going to be even more skeptical than when you were started.

So if you want something in your life, I tell my kids this, "You want something, you got to go and get it. You can't just sit around and wait for it to come to you. You got to do the work. You got to hustle." My son, he's nine years old... My God, my oldest, he wants to be a great baseball player, on this season he wasn't. This last season, he went up to a new league where the kids are pitching, before he was on the machine, they had a machine that was pitching. Now he went to where the kids are pitching. And using the machine he was a great hitter. He would hit almost every single time. But now with the machine, he couldn't hit at all. The whole season I think he had three hits, which was very discouraging for him because he's used to hitting the ball. He's used to getting on base.

And so what do we talk about? We talk about, "Well son, you want to get better, you need to get better, you need to practice, you need to hit and we need to catch, and we need to run, we need to increase your stamina and we want to do the whole thing." And so this morning when I left for work, he was running up and down the stairs at home, doing sit ups, doing pushups, doing some exercises, some strength building exercises that his coach gave him because for next season he wants to kick butt. And that's exactly the kind of mentality that we have to have. So find inside what's your desire is, find your reason, find your why, and then take some action.

And while you're taking action, because you're not going to be good right away, you're not going to be an expert at this stuff right away. It took me over, I don't know how long I've been doing this for, I think 15 years now I've been doing this and I still wouldn't say that I'm the best in the whole world. I got to the level where I'm comfortable and I'm financially okay. This is where I want to be. And so yeah, I do get better every year a little bit. I learned new things, I've seen more nuances, but it was the desire that got there, right? And it takes years and it takes time. You don't have to be the best right away. That's why passive training the way we've designed it is you could be wrong a lot and you could be wrong, a lot of your trades, but you're still going to be positive in your profit and loss statement.

And so the first step is just to take the first step and to get involved and do it. And put on trades, watch them work out. And that's how you develop belief. If you see a trade and it works, you see another one, and another one, and another one, and it works, and works, and works, [inaudible 00:18:45], one day you're going to be like, "Oh my God, this stuff is actually working. What do you know?" Right? And then you'll have the belief. So I'm not even worried about, if you don't believe me, as long as you do the work, you'll get there. Even if you don't have a desire, if you just want to be a rich fat slob, that's fine. If that's what you want, that's what you want. Okay, I'm not going to judge you, right? Eventually, hopefully you'll come around and you'll want to take that money and help people make the world a better place instead of being selfish. But hey, that's up to you. I can't tell you what to do with your money.

So even if you don't have that burning desire and you don't have the belief, as long as you take action, you'll succeed. And so with that, I will let you go and hopefully I have convinced you to take action, if nothing else. You know what you got to do. Pretty much, you already know what you have to do. And if you don't, you can email us and we'll point you in the right direction. Tell us what you want, tell us what you need, tell us where you are in your life, we'll hopefully be able to point you in the right direction. Trading might not be for you, it might be something else. But if it is, and if we think that trading can help you, then we'll let you know. That's the only thing I can do. All right folks, have a wonderful rest of your day and we'll talk soon, take care.

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Jan 27 2020

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Very informative

By William Hemsworth - Feb 08 2018
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Great show with great info. Highly recommend.

Loving the Content

By The Fat Packs Podcast - Feb 08 2018
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Soon to be new to the market and I'm so glad I found this. Great insight and very helpful.