06/29/2007 O STC .GOPSW - GOOG JUL 530 Put 1 $17.70 $14.95 $1,755.02
06/29/2007 O STC .GOPSW - GOOG JUL 530 Put 1 $15.00 $14.95 $1,485.02
06/29/2007 O BTO .GOPSW - GOOG JUL 530 Put 1 $14.60 $14.95 ($1,474.95)
06/25/2007 O BTO .GOPSW - GOOG JUL 530 Put 1 $16.40 $14.95 ($1,654.95) 110.14
Total Realized Gain for GOOG $110.14
Phew i waited and waited for 3 days and finally i can take my put profits ... i still have a call and 2 puts postion lol ... whichever way it go i also dun care.
Why did i hold for 3 days?
The candlesticks chart telling me that an evening star 3 days ago. Then follow by a Hammer and a doji. So all the infomation tell me to hold my puts position. =)
Saturday, June 30, 2007
Thursday, June 28, 2007
Technical Analysis (Candlestick Chart)
What is a Candlestick Chart ?
A candlestick chart is a style of bar-chart used primarily to describe price movements of an equity over time.
It is a combination of a line-chart and a bar-chart, in that each bar represents the range of price movement over a given time interval. It is most often used in technical analysis of equity price patterns. They appear superficially similar to error bars, but are unrelated.
History of Candlestick
Candlestick charts are said to have been developed in the 17th century by legendary Japanese rice trader Munehisa Honma. The charts gave Honma and others an overview of open, high, low, and close market prices over a certain period. This style of charting is very popular due to the level of ease in reading and understanding the graphs. Since the 17th century, there has been a lot of effort to relate chart patterns to the likely future behavior of a market. This method of charting prices proved to be particularly interesting, due to the ability to display four datapoints instead of one. The Japanese rice traders also found that the resulting charts would provide a fairly reliable tool to predict future demand.
Layout of Candlestick
Candlesticks are usually composed of the body (black/red or white), an upper and a lower shadow (wick). The wick illustrates the highest and lowest traded prices of a stock, and the body the opening and closing trades. If the stock went up, the body is white, with the opening price at the bottom of the body and the closing price at the top. If the stock went down, the body is black/red, with the opening price at the top and the closing price at the bottom. A candlestick need not have either a body or a wick.
Some Pattern of Candlestick
There are multiple forms of candlestick chart patterns, with the simplest depicted at right. Here is a quick overview of their names:
1 .White candlestick - signals uptrend movement (those occur in different lengths; the longer the body, the more significant the price change)
2. Black/Red candlestick - signals downtrend movement (those occur in different lengths; the longer the body, the more significant the price change)
3. Long lower shadow - bullish signal (the lower wick must be at least the body's size; the longer the lower wick, the more reliable the signal)
4. Long upper shadow - bearish signal (the upper wick must be at least the body's size; the longer the upper wick, the more reliable the signal)
5. Hammer - a bullish pattern during a downtrend (long lower wick and small or no body); Shaven head - a bullish pattern during a downtrend & a bearish pattern during an uptrend (no upper wick); Hanging man - bearish pattern during an uptrend (long lower wick, small or no body; wick has the multiple length of the body.
6. Inverted hammer - signals bottom reversal, however confirmation must be obtained from next trade (may be either a white or black body); Shaven bottom - signaling bottom reversal, however confirmation must be obtained from next trade (no lower wick); Shooting star - a bearish pattern during an uptrend (small body, long upper wick, small or no lower wick)
7. Spinning top white - neutral pattern, meaningful in combination with other candlestick patterns
8. Spinning top black/red - neutral pattern, meaningful in combination with other candlestick patterns
9. Doji - neutral pattern, meaningful in combination with other candlestick patterns
10. Long legged doji - signals a top reversal
11. Dragonfly doji - signals trend reversal (no upper wick, long lower wick)
12. Gravestone doji - signals trend reversal (no lower wick, long upper wick)
13. Marubozu white - dominant bullish trades, continued bullish trend (no upper, no lower wick)
14. Marubozu black/red - dominant bearish trades, continued bearish trend (no upper, no lower wick)
Personally i use candlestick chart for technical analysis. With a few combination of the candlestick, you will be able to predict up to 90% accurate the way your stock will react. The above 14 pattarns are simple and basic stuff of candlestick. There are plenty of combination of candlestick that will help you to analysis the stock.
Example when a solid white small candle follow by a large soild red/black candle(bearish englufing), the stock will normally go downward or go sideway.
Personally i love candlestick chart as it's not only providing 4 information by itself and when it combine with a few candles, they tell you more information. It is eyesight/user friendly for most of the people as compare to line or bar charts. Hope that the brief introduction on candlestick chart (technical analysis) will open up your world into trading =)
A candlestick chart is a style of bar-chart used primarily to describe price movements of an equity over time.
It is a combination of a line-chart and a bar-chart, in that each bar represents the range of price movement over a given time interval. It is most often used in technical analysis of equity price patterns. They appear superficially similar to error bars, but are unrelated.
History of Candlestick
Candlestick charts are said to have been developed in the 17th century by legendary Japanese rice trader Munehisa Honma. The charts gave Honma and others an overview of open, high, low, and close market prices over a certain period. This style of charting is very popular due to the level of ease in reading and understanding the graphs. Since the 17th century, there has been a lot of effort to relate chart patterns to the likely future behavior of a market. This method of charting prices proved to be particularly interesting, due to the ability to display four datapoints instead of one. The Japanese rice traders also found that the resulting charts would provide a fairly reliable tool to predict future demand.
Layout of Candlestick
Candlesticks are usually composed of the body (black/red or white), an upper and a lower shadow (wick). The wick illustrates the highest and lowest traded prices of a stock, and the body the opening and closing trades. If the stock went up, the body is white, with the opening price at the bottom of the body and the closing price at the top. If the stock went down, the body is black/red, with the opening price at the top and the closing price at the bottom. A candlestick need not have either a body or a wick.
Some Pattern of Candlestick
There are multiple forms of candlestick chart patterns, with the simplest depicted at right. Here is a quick overview of their names:
1 .White candlestick - signals uptrend movement (those occur in different lengths; the longer the body, the more significant the price change)
2. Black/Red candlestick - signals downtrend movement (those occur in different lengths; the longer the body, the more significant the price change)
3. Long lower shadow - bullish signal (the lower wick must be at least the body's size; the longer the lower wick, the more reliable the signal)
4. Long upper shadow - bearish signal (the upper wick must be at least the body's size; the longer the upper wick, the more reliable the signal)
5. Hammer - a bullish pattern during a downtrend (long lower wick and small or no body); Shaven head - a bullish pattern during a downtrend & a bearish pattern during an uptrend (no upper wick); Hanging man - bearish pattern during an uptrend (long lower wick, small or no body; wick has the multiple length of the body.
6. Inverted hammer - signals bottom reversal, however confirmation must be obtained from next trade (may be either a white or black body); Shaven bottom - signaling bottom reversal, however confirmation must be obtained from next trade (no lower wick); Shooting star - a bearish pattern during an uptrend (small body, long upper wick, small or no lower wick)
7. Spinning top white - neutral pattern, meaningful in combination with other candlestick patterns
8. Spinning top black/red - neutral pattern, meaningful in combination with other candlestick patterns
9. Doji - neutral pattern, meaningful in combination with other candlestick patterns
10. Long legged doji - signals a top reversal
11. Dragonfly doji - signals trend reversal (no upper wick, long lower wick)
12. Gravestone doji - signals trend reversal (no lower wick, long upper wick)
13. Marubozu white - dominant bullish trades, continued bullish trend (no upper, no lower wick)
14. Marubozu black/red - dominant bearish trades, continued bearish trend (no upper, no lower wick)
Personally i use candlestick chart for technical analysis. With a few combination of the candlestick, you will be able to predict up to 90% accurate the way your stock will react. The above 14 pattarns are simple and basic stuff of candlestick. There are plenty of combination of candlestick that will help you to analysis the stock.
Example when a solid white small candle follow by a large soild red/black candle(bearish englufing), the stock will normally go downward or go sideway.
Personally i love candlestick chart as it's not only providing 4 information by itself and when it combine with a few candles, they tell you more information. It is eyesight/user friendly for most of the people as compare to line or bar charts. Hope that the brief introduction on candlestick chart (technical analysis) will open up your world into trading =)
Wednesday, June 27, 2007
The 5 Day Pre Earnings Game
What is the 5DPEG?
This is a question that is commonly asked through emails and private messages that I get as frequently as twice to three times a week. So to put aside the task of having to answer this repeatedly, please read on …
CONRAD’S 5 DAY PRE-EARNINGS GAME
Very simply, its a simplification of an age old earnings strategy that I have taken, modified and taught, which is more than just a $50 winning strategy. The one thing that my students have come to realise is how consistent this is if you stick to the guidelines. And that is the key to its popularity … CONSISTENCY.
To trade earnings, one always trades the security right up till the day BEOFRE the announcement of the earnings report. This way, profits are taken off the table before the unpredictable gap that sends the stock either way upon announcement. There is no way to know where the stock will go after its announcement as there are way too many variables involved. Traders that attempt to second guess the gap are gambling on their wager going the right direction. The gains for being correct are usually not as great as the risk they undertake if the gap is against them. This is because of a phenomenon known as the “Volatility Crush”. Still, there will be those who gamble iin the market.
In the 5DPEG, students learn to qualify a stock with 10 simple steps involving a bit of fundamental research and technical analysis. These ten steps introduces the student to the discipline of researching before trading. It breeds a good trading habit that most people ignore … due diligence.
After qualifying the stock, students then plan their trade … another disciplne which is often lost in the heat of the trading battle. The plan is simple: identify your time target, profit target, stop loss and return on investment. If they are using Options, they will learn the dangers of using the wrong option and risk minimization by understanding Options Greeks.
Once the student has a plan, the next discipline kicks in … knowing when and how to make an entry with minimal risk. How many times have you put on a trade, only to see it losing money before the close of the session?
My students use the leverage of market sentiment, events, sector sentiment and general political awareness to avoid making a risky entry. They then apply one of two Minimal Risk Entries that they learnt and wait for their entry patiently. Most of the time, this entry has proven profitable as students are known to profit take on their profit targets the next day.
Those who don’t reach their profit targets then stick to the trading plan till one of three things happens: 1. Profit target is achieved … 2. Time target has arrived … 3. Cut loss at a predetermined level of tolerance.
Actually, there is a 4th … students also learn to identify Japanese Candlestick formations to defend their positions.
These habits are so automated with the 5DPEG that students unwittingly learn the best habits a good trader must have … the ability to overcome fear and the will to resist greed. This way, the student become emotionless and will trade with confidence. They also learn a more valuable lesson …
By cutting your losses early and letting your profits run, the 5DPEG will give you a success return on no less than 80%. So out of 10 trades they will have 8 profitable trades. But if for some unforseen reason, the tables turn and the ratio kicks back a 30% success rate, by cutting their losses at $30, 7 losing trades will mean a loss of $210. Their 3 winning trades will turn around a minimum profit of $150, should they stick to the trading plan. Thus the loss for sticking to the rules in an unlikely 3:7 ratio, is only $60 in 10 trades.
But because they learned to let their profits run and to use stop losses to protect their profits, they are likely to recoup this $60 loss, by letting these 3 winners run for another $20 each to break even or even make some. So what’s the worse that can happen? They don’t lose much.
In my 2 plus years of sharing this simple strategy, I haven’t met anyone who has had a worse return than 60% of winning trades.
Finally, but certainly not the last beautiful thing about the 5DPEG, is that the student will gain experience and confidence without having to stomach major losses to kill their spirit and account. This experience allows the student to stretch the parameters of the 5DPEG and explore more strategies that will improve their trading styles.
Through the 5DPEG, they will have learned to read and understand reports, analysts’ opinions, market sentiments, company balance sheets, everything you need to know about EPS, PE ratios, insider trades, relative strength etc etc etc …. and armed with this knowledge, they will come back with more sophisticated questions that can only help them grow into more savvy investor/traders.
So, its quite evident that I have discovered a simple but truly effective way for novices to trade and learn about trading without the major risks while picking up good trading habits along the way. And that is not all that the 5DPEG has to offer …
Some of my older students are now multiplying their positions to make exponential profits. You go do the math.
Be it a simple (and affordable) $50 strategy with a great learning curve, or a great profitable strategy with minimal risk, the 5DPEG has opened the world of trading to many of my students and the principles of what I teach and what they learn have all come from this humble little game.
Many want to learn it. Many others wished they knew about it sooner. And then there are the few who want to own it. But there is only one true 5DPEG and everyone knows where to find it.
I remain, its humble creator,
Conrad.
Here are some of the student who have benefits from 5DPEG ...
Conrad is my mentor and a professional trader. I learn alot of trading skill and psychology from him. The 5DPEG is one of the manay strategy that he has created. There are still alot of testimony from alot of student that have benefit from the 5DPEG strategy. If you are interested in learning the 5DPEG strategy, just make a comments here or drop me an email akalawoo@gmail.com. Please state your name, country, contact no and email.
This is a question that is commonly asked through emails and private messages that I get as frequently as twice to three times a week. So to put aside the task of having to answer this repeatedly, please read on …
CONRAD’S 5 DAY PRE-EARNINGS GAME
Very simply, its a simplification of an age old earnings strategy that I have taken, modified and taught, which is more than just a $50 winning strategy. The one thing that my students have come to realise is how consistent this is if you stick to the guidelines. And that is the key to its popularity … CONSISTENCY.
To trade earnings, one always trades the security right up till the day BEOFRE the announcement of the earnings report. This way, profits are taken off the table before the unpredictable gap that sends the stock either way upon announcement. There is no way to know where the stock will go after its announcement as there are way too many variables involved. Traders that attempt to second guess the gap are gambling on their wager going the right direction. The gains for being correct are usually not as great as the risk they undertake if the gap is against them. This is because of a phenomenon known as the “Volatility Crush”. Still, there will be those who gamble iin the market.
In the 5DPEG, students learn to qualify a stock with 10 simple steps involving a bit of fundamental research and technical analysis. These ten steps introduces the student to the discipline of researching before trading. It breeds a good trading habit that most people ignore … due diligence.
After qualifying the stock, students then plan their trade … another disciplne which is often lost in the heat of the trading battle. The plan is simple: identify your time target, profit target, stop loss and return on investment. If they are using Options, they will learn the dangers of using the wrong option and risk minimization by understanding Options Greeks.
Once the student has a plan, the next discipline kicks in … knowing when and how to make an entry with minimal risk. How many times have you put on a trade, only to see it losing money before the close of the session?
My students use the leverage of market sentiment, events, sector sentiment and general political awareness to avoid making a risky entry. They then apply one of two Minimal Risk Entries that they learnt and wait for their entry patiently. Most of the time, this entry has proven profitable as students are known to profit take on their profit targets the next day.
Those who don’t reach their profit targets then stick to the trading plan till one of three things happens: 1. Profit target is achieved … 2. Time target has arrived … 3. Cut loss at a predetermined level of tolerance.
Actually, there is a 4th … students also learn to identify Japanese Candlestick formations to defend their positions.
These habits are so automated with the 5DPEG that students unwittingly learn the best habits a good trader must have … the ability to overcome fear and the will to resist greed. This way, the student become emotionless and will trade with confidence. They also learn a more valuable lesson …
By cutting your losses early and letting your profits run, the 5DPEG will give you a success return on no less than 80%. So out of 10 trades they will have 8 profitable trades. But if for some unforseen reason, the tables turn and the ratio kicks back a 30% success rate, by cutting their losses at $30, 7 losing trades will mean a loss of $210. Their 3 winning trades will turn around a minimum profit of $150, should they stick to the trading plan. Thus the loss for sticking to the rules in an unlikely 3:7 ratio, is only $60 in 10 trades.
But because they learned to let their profits run and to use stop losses to protect their profits, they are likely to recoup this $60 loss, by letting these 3 winners run for another $20 each to break even or even make some. So what’s the worse that can happen? They don’t lose much.
In my 2 plus years of sharing this simple strategy, I haven’t met anyone who has had a worse return than 60% of winning trades.
Finally, but certainly not the last beautiful thing about the 5DPEG, is that the student will gain experience and confidence without having to stomach major losses to kill their spirit and account. This experience allows the student to stretch the parameters of the 5DPEG and explore more strategies that will improve their trading styles.
Through the 5DPEG, they will have learned to read and understand reports, analysts’ opinions, market sentiments, company balance sheets, everything you need to know about EPS, PE ratios, insider trades, relative strength etc etc etc …. and armed with this knowledge, they will come back with more sophisticated questions that can only help them grow into more savvy investor/traders.
So, its quite evident that I have discovered a simple but truly effective way for novices to trade and learn about trading without the major risks while picking up good trading habits along the way. And that is not all that the 5DPEG has to offer …
Some of my older students are now multiplying their positions to make exponential profits. You go do the math.
Be it a simple (and affordable) $50 strategy with a great learning curve, or a great profitable strategy with minimal risk, the 5DPEG has opened the world of trading to many of my students and the principles of what I teach and what they learn have all come from this humble little game.
Many want to learn it. Many others wished they knew about it sooner. And then there are the few who want to own it. But there is only one true 5DPEG and everyone knows where to find it.
I remain, its humble creator,
Conrad.
Here are some of the student who have benefits from 5DPEG ...
Hi Conrad,
Thanks for the knowledge that you have bestow on me….
I’ve made quit a handsome quantity of money (even tho’ it paper / virtual
trading but I treat it as if it real money)
on the following stock. CROX
(designer, manufacturer and marketer of footwear for men, women and children
under the crocs brand) and NGA ((North American Galvanizing) .
Never
thought making money soooo easy.
Cheers
(name removed for privacy)
Hi! ConradThis is an article by conrad's student Kenny Tran ...
I can not believe my eye on the result of 5 DPEG trade.
Just
follow the step one by one.
The result was incredible with $5000 virtual
capital the gain in 3 days is more 20%
Can we learn how to place advance
order to automat the profit take on our next meeting on July 20 !!!
Thanks Great coach
Cheers
(name removed for privacy)
Last week, after finishing the 5-day tutorial with Conrad, I started to play the
5DPEG game (designed for novice traders). It’s really simple to earn money with
5DPEG game. Although it isn’t a big sum of money, you can make it consistently
throughout the month. Let’s say you make average US$50 a day by playing the
5DPEG game (part-time). You can earn an extra US$1,000 per month (or S$1,600)
beside your salary. Not bad right?
This is my humble paper profit with
5DPEG game after 4 days.
Though it’s only paper profit, I’m really proud of it for
start because I know I didn’t gamble with the stock but I got it with the
knowledge learnt from Conrad and my effort.
Conrad is my mentor and a professional trader. I learn alot of trading skill and psychology from him. The 5DPEG is one of the manay strategy that he has created. There are still alot of testimony from alot of student that have benefit from the 5DPEG strategy. If you are interested in learning the 5DPEG strategy, just make a comments here or drop me an email akalawoo@gmail.com. Please state your name, country, contact no and email.
How To Make Money in Trading
I guess alot of people would love to make money. Only crazy people dun like or love money. Any saint people will want to have plenty and tons of money. I know alot of people will think that playing or trading stock is very easy as long as you know how to buy or sell a stock.
Well in actual fact yes, it is very easy to trade stock but to make money out of it, it quite difficult.
Here are some question for those who want to go into trading :
- Do you drive without a license ?
- Do you not bargin for a shirt,pants,dress and etc if you are shopping ?
- Do you work in a specific field without having the degree/knowledge of the field ?
- Do you want to get married without knowing your partner ?
Actually i have tons and tons of question for those who want or interested in trading. The ultimate question is :
- Do You understand the stock that you are trading ?
If dun understand the stock that you are trading, then DO NOT TRADE IT. You will not lose any money if you dun trade the stock. When you trade a stock you lose money immediately through commision and slippage the very least.
If you can spend tons of money + time on education and shopping.
Why cant you just do the same when you trade on stock?
How often when you buy a stock, you start to lose money. When you sell a stock and it start to make money.
I just hope that you will do your due diligence on trading before you start to trade. Do not worry about the missing of opptunities as there are always opptunities out there waiting for you when you know how to trade it properly.
If you know how not to lose money when you trade, that is where you will make moeny
Well in actual fact yes, it is very easy to trade stock but to make money out of it, it quite difficult.
Here are some question for those who want to go into trading :
- Do you drive without a license ?
- Do you not bargin for a shirt,pants,dress and etc if you are shopping ?
- Do you work in a specific field without having the degree/knowledge of the field ?
- Do you want to get married without knowing your partner ?
Actually i have tons and tons of question for those who want or interested in trading. The ultimate question is :
- Do You understand the stock that you are trading ?
If dun understand the stock that you are trading, then DO NOT TRADE IT. You will not lose any money if you dun trade the stock. When you trade a stock you lose money immediately through commision and slippage the very least.
If you can spend tons of money + time on education and shopping.
Why cant you just do the same when you trade on stock?
How often when you buy a stock, you start to lose money. When you sell a stock and it start to make money.
I just hope that you will do your due diligence on trading before you start to trade. Do not worry about the missing of opptunities as there are always opptunities out there waiting for you when you know how to trade it properly.
If you know how not to lose money when you trade, that is where you will make moeny
Monday, June 25, 2007
7 Deadly Trading Sins
I chance upon this article by Ryan Jones yesterday while i was researching on options. I find it quite meaningful and some of the sins i do encounter personally. So i hope that you guys will be benefit from this article.
1.Focusing a majority of time on technical analysis and trying to predict price action.
Do you know how many indicators have been created for trading? Approximately two and the both do essentially the same thing. Funny thing is though, there are a million different names for them. 99% of all indicators that are derived from price action do essentially the same thing. Do you know what that is? Most indicators simply tell you where price action is now compared to where it has been in the past.
There is no indicator out there that is derived from price action that will tell you where the market is going to go. Many traders may say that they agree with this, but how they practically apply indicators, and more importantly, by the vast amount of time they spend looking for and/or creating that "perfect" indicators says differently.
There is a time and place for indicators and technical analysis, but don't waste most of your time trying to get that perfect one. You will be far better off understanding what they are, finding one that you are comfortable with and then spend your time making sure that other areas are being taken care of (i.e. expectations, money management, etc.). Those who system hop looking for that perfect one never spend the time to build a foundation and usually end up losing.
2.Buying short-term, out of the money options.
For a long time, options have been the beginning ground for many, many traders. They were for me. Buy short-term, out of the money options (because they are cheap), and you have the potential of amassing a huge return in a short period of time. Uh huh.
What you have is a fast track to losing money. I could be a little off on this, but there are better odds that you will walk into a casino and come out a winner. The only way you should buy short-term out of the money options is if you have one KILLER market timing strategy; you then could amass a fortune.
Truth is, there are four things that could happen for you to lose buying these types of options, and only one very unlikely event that will produce a profit. Think about it. If you buy an option and the market goes in your favor, but not past the strike price + whatever you paid for the option, AND within the time period of the option, you lose.
If the market stays the same, you lose. If the market moves against you, you lose. If the market moves in your favor but not to the strike price, you lose. You have A LOT going against you. This type of option buying is common with traders, but you should stay far away from it.
3.Asking your broker what type of money management strategy to use.
There is one decision that every single trader makes when they place a trade whether they put any amount of thought to it or not. That decision is trade size. Every time you get into the market, you are making a trade size decision. Do I trade one, two, more, etc. This is the SINGLE most important trading decision that will affect your long-term success (or failure) in trading.
Many traders rely on what they feel is a good trade size, and many traders end up asking their broker, who then tells them "never risk more than 1% - 2% of your account on any given trade". Well, that sounds good and all, but it is the most inefficient money management strategy you can use. If they say "trade one contract for every $10,000 in your account", that is also one of the worst money management strategies you can use.
Most traders spend a majority of their time on technical analysis (where to get in and where to get out), but look where that has gotten most traders. You, you spend some serious time learning and understanding money management strategies. Proper money management can magnify profit potential dramatically AND at the very same time, keep you from blowing your account out when the system or strategy doesn't work out. This is critically important if you want to stay in the game.
4.Over-Trading
I actually have two deadly trading sins that are money management related. Make no mistake about it, after speaking with thousands upon thousands of traders, after going through more than one lesson of my own, overtrading (too much risk in the account) is the NUMBER ONE ACCOUNT KILLER by far.
Even those who understand money management principles can be guilty for several reasons. But the first thing is to understand what would be considered overtrading for your account size, risk levels, goals and trading strategy being implemented. For that, you need to understand first and foremost the consequences of various money management strategies in order to implement the right one. Secondly, you need to understand the realistic expectations of your trading strategy, including worst case scenario. Only then will you know whether the money management strategy is too risky for that particular trading strategy.
5.Under-educating
Does an airline pilot fly a plane after reading a few books on the subject? How about a brain surgeon? Or perhaps a few seminars on top of the books properly prepare them? How about any skilled profession. Yet, the level of trading education that exists at the time of the first trade is dismal at best. Do you know how much education I had before I bought an option? I knew how to buy an option, and that is about it.
If 95% of traders lose, that might be the first hint that this requires some skill before you can expect to be successful, and even then it is not assured. Education is not learning about a strategy, or learning about a system that has 75% winners. It is UNDERSTANDING what is out there, why and what gives it any chance of actually making money in the long run. That goes far beyond learning to buy when the blue line is crossed and sell when the red line is crossed.
To make things worse, the amount of foundational education that is available is scarce. Everyone is pushing the seminars about buying above the blue line and selling below the red and all your dreams will come true. This is part of the reason that I require traders to go through one of my courses on any given specific strategy before they can access the rules or signals. You must build a foundation of understanding before you can expect to successfully trade.
6.Expectations of trading for a living.
Given all of the above, you may or may not have this expectation anymore based on where you are at (if you had it at all). It amazes me how many traders believe they can trade for a living yet knowing that most people don't and most who have tried have failed. I promise you as sure as I am sitting here right now thinking about how I am going to bag me one big rat, if you are guilty of the trading sins above, the probability of you ever trading for a living is next to none.
7.Bringing ego into trading decisions.
Ego blinds people. This is almost always inextricably linked to many of the above. Many traders come into this endeavor knowing that most are not successful, or at least learn it pretty early on; yet that doesn't stop them from doing the EXACT SAME THINGS that others are doing. This cannot be contributed to anything other than ego.
"I'm different", "yeah, others may not have succeeded, but I have a medical degree" or law degree or engineering degree, or you fill in the blank. "I know many aren't successful, but I'm not like them, I will be successful my first year". Uh huh.
Approximately 65,000 traders are going to read this article and perhaps 100 will stop and say, "you know, I can't keep doing what everyone else is doing and expect to succeed?. Most will continue doing what they have been doing and most will never be successful. I've learned this because I have bee in the industry for a long, long time. Ego is a killer and you need to slay it before it slays you.
About the Author
Ryan Jones is considered one of the trading industries "most complete traders". Starting his trading career at the early age of 16, he had traded nearly every major market and strategy by the age of 21. At the age of 26, Ryan signed a book deal with John Wiley making him one of the youngest authors ever in the field of futures trading. His book, The Trading Game, Playing by the Numbers to Make Millions is still considered to be the authority on the subject of trading and money management by many leading traders. Ryan's advanced experience and knowledge across many trading fields such as Technical Analysis, Option Trading, Money Management and the S&P have lead to several trading feats, including turning a $15,000 account into over $107,000 in less than 90-days short-term trading the S&P (real money).
1.Focusing a majority of time on technical analysis and trying to predict price action.
Do you know how many indicators have been created for trading? Approximately two and the both do essentially the same thing. Funny thing is though, there are a million different names for them. 99% of all indicators that are derived from price action do essentially the same thing. Do you know what that is? Most indicators simply tell you where price action is now compared to where it has been in the past.
There is no indicator out there that is derived from price action that will tell you where the market is going to go. Many traders may say that they agree with this, but how they practically apply indicators, and more importantly, by the vast amount of time they spend looking for and/or creating that "perfect" indicators says differently.
There is a time and place for indicators and technical analysis, but don't waste most of your time trying to get that perfect one. You will be far better off understanding what they are, finding one that you are comfortable with and then spend your time making sure that other areas are being taken care of (i.e. expectations, money management, etc.). Those who system hop looking for that perfect one never spend the time to build a foundation and usually end up losing.
2.Buying short-term, out of the money options.
For a long time, options have been the beginning ground for many, many traders. They were for me. Buy short-term, out of the money options (because they are cheap), and you have the potential of amassing a huge return in a short period of time. Uh huh.
What you have is a fast track to losing money. I could be a little off on this, but there are better odds that you will walk into a casino and come out a winner. The only way you should buy short-term out of the money options is if you have one KILLER market timing strategy; you then could amass a fortune.
Truth is, there are four things that could happen for you to lose buying these types of options, and only one very unlikely event that will produce a profit. Think about it. If you buy an option and the market goes in your favor, but not past the strike price + whatever you paid for the option, AND within the time period of the option, you lose.
If the market stays the same, you lose. If the market moves against you, you lose. If the market moves in your favor but not to the strike price, you lose. You have A LOT going against you. This type of option buying is common with traders, but you should stay far away from it.
3.Asking your broker what type of money management strategy to use.
There is one decision that every single trader makes when they place a trade whether they put any amount of thought to it or not. That decision is trade size. Every time you get into the market, you are making a trade size decision. Do I trade one, two, more, etc. This is the SINGLE most important trading decision that will affect your long-term success (or failure) in trading.
Many traders rely on what they feel is a good trade size, and many traders end up asking their broker, who then tells them "never risk more than 1% - 2% of your account on any given trade". Well, that sounds good and all, but it is the most inefficient money management strategy you can use. If they say "trade one contract for every $10,000 in your account", that is also one of the worst money management strategies you can use.
Most traders spend a majority of their time on technical analysis (where to get in and where to get out), but look where that has gotten most traders. You, you spend some serious time learning and understanding money management strategies. Proper money management can magnify profit potential dramatically AND at the very same time, keep you from blowing your account out when the system or strategy doesn't work out. This is critically important if you want to stay in the game.
4.Over-Trading
I actually have two deadly trading sins that are money management related. Make no mistake about it, after speaking with thousands upon thousands of traders, after going through more than one lesson of my own, overtrading (too much risk in the account) is the NUMBER ONE ACCOUNT KILLER by far.
Even those who understand money management principles can be guilty for several reasons. But the first thing is to understand what would be considered overtrading for your account size, risk levels, goals and trading strategy being implemented. For that, you need to understand first and foremost the consequences of various money management strategies in order to implement the right one. Secondly, you need to understand the realistic expectations of your trading strategy, including worst case scenario. Only then will you know whether the money management strategy is too risky for that particular trading strategy.
5.Under-educating
Does an airline pilot fly a plane after reading a few books on the subject? How about a brain surgeon? Or perhaps a few seminars on top of the books properly prepare them? How about any skilled profession. Yet, the level of trading education that exists at the time of the first trade is dismal at best. Do you know how much education I had before I bought an option? I knew how to buy an option, and that is about it.
If 95% of traders lose, that might be the first hint that this requires some skill before you can expect to be successful, and even then it is not assured. Education is not learning about a strategy, or learning about a system that has 75% winners. It is UNDERSTANDING what is out there, why and what gives it any chance of actually making money in the long run. That goes far beyond learning to buy when the blue line is crossed and sell when the red line is crossed.
To make things worse, the amount of foundational education that is available is scarce. Everyone is pushing the seminars about buying above the blue line and selling below the red and all your dreams will come true. This is part of the reason that I require traders to go through one of my courses on any given specific strategy before they can access the rules or signals. You must build a foundation of understanding before you can expect to successfully trade.
6.Expectations of trading for a living.
Given all of the above, you may or may not have this expectation anymore based on where you are at (if you had it at all). It amazes me how many traders believe they can trade for a living yet knowing that most people don't and most who have tried have failed. I promise you as sure as I am sitting here right now thinking about how I am going to bag me one big rat, if you are guilty of the trading sins above, the probability of you ever trading for a living is next to none.
7.Bringing ego into trading decisions.
Ego blinds people. This is almost always inextricably linked to many of the above. Many traders come into this endeavor knowing that most are not successful, or at least learn it pretty early on; yet that doesn't stop them from doing the EXACT SAME THINGS that others are doing. This cannot be contributed to anything other than ego.
"I'm different", "yeah, others may not have succeeded, but I have a medical degree" or law degree or engineering degree, or you fill in the blank. "I know many aren't successful, but I'm not like them, I will be successful my first year". Uh huh.
Approximately 65,000 traders are going to read this article and perhaps 100 will stop and say, "you know, I can't keep doing what everyone else is doing and expect to succeed?. Most will continue doing what they have been doing and most will never be successful. I've learned this because I have bee in the industry for a long, long time. Ego is a killer and you need to slay it before it slays you.
About the Author
Ryan Jones is considered one of the trading industries "most complete traders". Starting his trading career at the early age of 16, he had traded nearly every major market and strategy by the age of 21. At the age of 26, Ryan signed a book deal with John Wiley making him one of the youngest authors ever in the field of futures trading. His book, The Trading Game, Playing by the Numbers to Make Millions is still considered to be the authority on the subject of trading and money management by many leading traders. Ryan's advanced experience and knowledge across many trading fields such as Technical Analysis, Option Trading, Money Management and the S&P have lead to several trading feats, including turning a $15,000 account into over $107,000 in less than 90-days short-term trading the S&P (real money).
Saturday, June 23, 2007
The 6 Most Dangerous Options Trading Errors
Have you ever lost money trading options before, or has someone told you that options are a losing game? That is probably because the methods being used to trade options were faulty or overly simplified. My mentor Conrad identified the follow 6 reason why the majority of option players fail to make money.
1 Inappropriate selection methods
Selecting the right stock (and the best corresponding option) is the first step in successful option trading. Some option traders will take a situation they just read about in the news as an option play. Others tend to look at longer-term measures like a stock’s valuation as an indication of its short-term potential. This mismatching of time frames is one of the biggest mistakes made by those who trade options. My staff and I sort through the entire universe of stocks with listed options, in order to pinpoint only those situations that look most attractive for sharp movements. The Option Advisor uses a methodology based on not one, but all of the key shortterm factors that drive stock prices — technical, fundamental, and sentiment.
2 Betting against trends
Trends in prices, whether up or down, have a tendency to last longer than people expect. Most traders lose the bulk of their money betting against trends. I’ve specifically developed my indicators to tell me not only the nature of the trend, but also the investing public’s view of the current trend. What I’ve found is that a prevailing disbelief of an existing trend gives a confirmation that the trend will continue, since there’s money on the sidelines that will eventually be convinced to buy into the trend before it ends. Thus, my approach in buying options with the trend allows you to trade on the right side of the market.
3 Inability to take a loss
Sure, everybody loves to hear about gains and profits, as this is what we all seek to achieve. While “loss” has negative emotions attached to it, the key is not to be emotional in trading, but rather to stay objective in all trading decisions. If the market is not validating my analysis, I have specific exit rules that get my subscribers out of option purchases before their expiration, so that big losses are often avoidable and capital can be preserved for future trades that are likely to be more profitable.
4 Lack of discipline
Many option traders fail because even when they do have gains, they let them slip away by not knowing when to get out and take a profit. Often, you should be taking a profit when the position is moving most obviously in your favor. What I’ve been able to teach option traders is that a mechanical system for entry and exit prices must be in place before the trade is initiated. I pre-determine the highest price that should be paid to enter the option, and the subsequent price that, when reached, will automatically force profits to be taken. This allows traders to prevent profits from slipping away, and enforces the discipline necessary in any successful trading approach.
5 Poormoney management
Every smart option trader knows that even with a winning approach, money management is crucial in building an account’s value. The primary consideration is how much to invest in each trade every month. Often, amateur option players come into the business and make some nice gains right off the bat. Then, thinking this is a simple way to riches, they let all their capital (including all their profits) ride on a subsequent trade that wipes them out. Then they vow to never trade options again. The answer here is to first know the rules of the options game: there is great upside on winning trades, while you can also lose all of your investment in a particular option trade. Clearly no matter how good your approach, you will never win 100 percent of the time, and you should not allocate all (or even the majority) of your trading capital to any particular trade. How much do you invest? Each month, I tell Option Advisorsubscribers how much of each portfolio’s cash reserves to devote to the recommendations in a particular newsletter.
6 Consensus thinking
Amateur traders tend to bet with consensus thinking, which is a sure way to lose in option trading over time. Whether it’s an article in a national publication, a hyped new product or a “tip” you’re betting on, Wall Street has a way of already discounting such news before it becomes widely disseminated. By that time, smart traders are looking for opportunities to bet opposite from the conventional wisdom. I’ve learned that you can use options very successfully in contrarian bets. Understand that a contrarian does not always “zig” when other say “zag,” but rather looks for extreme viewpoints that are apt to spotlight the key turning points in stock prices. That’s what defines true contrarians, and that’s a major reason why I’ve been so successful for those who subscribe to the Option Advisor.
By Conrad - (my mentor)
1 Inappropriate selection methods
Selecting the right stock (and the best corresponding option) is the first step in successful option trading. Some option traders will take a situation they just read about in the news as an option play. Others tend to look at longer-term measures like a stock’s valuation as an indication of its short-term potential. This mismatching of time frames is one of the biggest mistakes made by those who trade options. My staff and I sort through the entire universe of stocks with listed options, in order to pinpoint only those situations that look most attractive for sharp movements. The Option Advisor uses a methodology based on not one, but all of the key shortterm factors that drive stock prices — technical, fundamental, and sentiment.
2 Betting against trends
Trends in prices, whether up or down, have a tendency to last longer than people expect. Most traders lose the bulk of their money betting against trends. I’ve specifically developed my indicators to tell me not only the nature of the trend, but also the investing public’s view of the current trend. What I’ve found is that a prevailing disbelief of an existing trend gives a confirmation that the trend will continue, since there’s money on the sidelines that will eventually be convinced to buy into the trend before it ends. Thus, my approach in buying options with the trend allows you to trade on the right side of the market.
3 Inability to take a loss
Sure, everybody loves to hear about gains and profits, as this is what we all seek to achieve. While “loss” has negative emotions attached to it, the key is not to be emotional in trading, but rather to stay objective in all trading decisions. If the market is not validating my analysis, I have specific exit rules that get my subscribers out of option purchases before their expiration, so that big losses are often avoidable and capital can be preserved for future trades that are likely to be more profitable.
4 Lack of discipline
Many option traders fail because even when they do have gains, they let them slip away by not knowing when to get out and take a profit. Often, you should be taking a profit when the position is moving most obviously in your favor. What I’ve been able to teach option traders is that a mechanical system for entry and exit prices must be in place before the trade is initiated. I pre-determine the highest price that should be paid to enter the option, and the subsequent price that, when reached, will automatically force profits to be taken. This allows traders to prevent profits from slipping away, and enforces the discipline necessary in any successful trading approach.
5 Poormoney management
Every smart option trader knows that even with a winning approach, money management is crucial in building an account’s value. The primary consideration is how much to invest in each trade every month. Often, amateur option players come into the business and make some nice gains right off the bat. Then, thinking this is a simple way to riches, they let all their capital (including all their profits) ride on a subsequent trade that wipes them out. Then they vow to never trade options again. The answer here is to first know the rules of the options game: there is great upside on winning trades, while you can also lose all of your investment in a particular option trade. Clearly no matter how good your approach, you will never win 100 percent of the time, and you should not allocate all (or even the majority) of your trading capital to any particular trade. How much do you invest? Each month, I tell Option Advisorsubscribers how much of each portfolio’s cash reserves to devote to the recommendations in a particular newsletter.
6 Consensus thinking
Amateur traders tend to bet with consensus thinking, which is a sure way to lose in option trading over time. Whether it’s an article in a national publication, a hyped new product or a “tip” you’re betting on, Wall Street has a way of already discounting such news before it becomes widely disseminated. By that time, smart traders are looking for opportunities to bet opposite from the conventional wisdom. I’ve learned that you can use options very successfully in contrarian bets. Understand that a contrarian does not always “zig” when other say “zag,” but rather looks for extreme viewpoints that are apt to spotlight the key turning points in stock prices. That’s what defines true contrarians, and that’s a major reason why I’ve been so successful for those who subscribe to the Option Advisor.
By Conrad - (my mentor)
Friday, June 22, 2007
10 Famous Quotes for Trading
There are some meaningful and aspiring quotes that i have read from books or i heard from my coaches. Today im going to share with you guys. Hope that it will inspire you and you might use the quotes as a daily reminder or as a form of motivation.
"Trading is hardwork, laborious and boring, just like any other jobs. If you are excited about it, you are gambling" by Conrad
"There is no calamity greater than lavish desires. There is no guilt than discontentment. And there is no greater disaster than greed." by Lao Tze
"Its not about being right or wrong, rather, its about how much money you make when you're right and how much you don't lose when you're wrong" by George Soros
"Luck is what you have left over after you give 100 percent" by Langston Coleman
"In the bussiness world, the rearview mirror is always clearer than the windshield." by Warren Buffet
"Experience is a hard teacher because she gives the test first, the lesson afterwards." by Vernon Sanders Law
"Human beings, by changing the inner attitudes of their minds, can change the outer aspects of their lives." by William James
"The only that overcomes hard luck is hard work." by Harry Golden
"A goal without a plan is just a wish." Antonie de Saint-Exupery
"If i can do it, so can you" by Adam Khoo
"Trading is hardwork, laborious and boring, just like any other jobs. If you are excited about it, you are gambling" by Conrad
"There is no calamity greater than lavish desires. There is no guilt than discontentment. And there is no greater disaster than greed." by Lao Tze
"Its not about being right or wrong, rather, its about how much money you make when you're right and how much you don't lose when you're wrong" by George Soros
"Luck is what you have left over after you give 100 percent" by Langston Coleman
"In the bussiness world, the rearview mirror is always clearer than the windshield." by Warren Buffet
"Experience is a hard teacher because she gives the test first, the lesson afterwards." by Vernon Sanders Law
"Human beings, by changing the inner attitudes of their minds, can change the outer aspects of their lives." by William James
"The only that overcomes hard luck is hard work." by Harry Golden
"A goal without a plan is just a wish." Antonie de Saint-Exupery
"If i can do it, so can you" by Adam Khoo
Wednesday, June 20, 2007
Thinkorswim (TOS)
Just a few comments about TOS platform:
1) You can actually stream a few charts at the same time in TOS platform. You can do so either in "TOS charts" or "Prophnet".
2) Commission cost is $1.50 per contract (and not $2 to $3). You just need to know how to get it.
3) The live chat support is excellent because the helpers were all ex-floor traders from the OEX pit at CBOE. Compared to IB which is a pure online discount broker without any techical support, you can make a judgment.
4) Shadowtrader live commentary every night from 9:15am to 11:30am EST and from 1:30pm EST to 4:00pm is free for TOS users. Lots of education materials on how to scalp the market or how to read a particular chart. By far, OX and IB cannot even match that.
By Greeksman
Thanks for the input especially for the commission cost.
1) You can actually stream a few charts at the same time in TOS platform. You can do so either in "TOS charts" or "Prophnet".
2) Commission cost is $1.50 per contract (and not $2 to $3). You just need to know how to get it.
3) The live chat support is excellent because the helpers were all ex-floor traders from the OEX pit at CBOE. Compared to IB which is a pure online discount broker without any techical support, you can make a judgment.
4) Shadowtrader live commentary every night from 9:15am to 11:30am EST and from 1:30pm EST to 4:00pm is free for TOS users. Lots of education materials on how to scalp the market or how to read a particular chart. By far, OX and IB cannot even match that.
By Greeksman
Thanks for the input especially for the commission cost.
Daily Winning Options Trading
06/19/2007 O STC .GOPGV - GOOG JUL 520 Call 2 $15.00 $14.95 $2,985.00
06/19/2007 O BTO .GOPGV - GOOG JUL 520 Call 2 $14.70 $14.95 ($2,954.95)
06/19/2007 O STC .GOPGV - GOOG JUL 520 Call 2 $15.50 $14.95 $3,085.00
06/19/2007 O BTO .GOPGV - GOOG JUL 520 Call 1 $14.20 $14.95 ($1,434.95)
06/19/2007 O BTO .GOPGV - GOOG JUL 520 Call 1 $16.30 $14.95 ($1,644.95) 35.15
06/19/2007 O STC .GOPSK - GOOG JUL 490 Put 3 $6.80 $14.95 $2,025.01
06/19/2007 O BTO .GOPSK - GOOG JUL 490 Put 3 $7.20 $14.95 ($2,174.95) -149.94
Total Realized Loss for GOOG ($114.79)
GS
06/19/2007 O STC .GPYGD - GS JUL 220 Call 3 $10.70 $14.95 $3,195.00
06/19/2007 O BTO .GPYGD - GS JUL 220 Call 3 $10.20 $14.95 ($3,074.95) $120.05
Total Realized Gain for GS $120.05
Total Realized Gain $5.26
See the commision ... 15Us dollars per trade. Today i donate US$135 to OX ... i think OX love me alot ... lol ... At least now when my trade goes wrong way i know how to make it back ... so not that bad ... and must have patient and calm when trading...
DO NOT FORCE TO TRADE ... Not everyday can make money and also There are Plenty of Opptunity for you to make profits ...
The chart dun bluff you ... the only problem is how you read it and analysis it. A good day overall especially in GS ... and also goog too ... ;D
Go with the waterflow... and you will benefit will the flow ... go against it or predict it ... you will have a miserable death ... well you may get Lucky sometimes ... so happy hunting ...
06/19/2007 O BTO .GOPGV - GOOG JUL 520 Call 2 $14.70 $14.95 ($2,954.95)
06/19/2007 O STC .GOPGV - GOOG JUL 520 Call 2 $15.50 $14.95 $3,085.00
06/19/2007 O BTO .GOPGV - GOOG JUL 520 Call 1 $14.20 $14.95 ($1,434.95)
06/19/2007 O BTO .GOPGV - GOOG JUL 520 Call 1 $16.30 $14.95 ($1,644.95) 35.15
06/19/2007 O STC .GOPSK - GOOG JUL 490 Put 3 $6.80 $14.95 $2,025.01
06/19/2007 O BTO .GOPSK - GOOG JUL 490 Put 3 $7.20 $14.95 ($2,174.95) -149.94
Total Realized Loss for GOOG ($114.79)
GS
06/19/2007 O STC .GPYGD - GS JUL 220 Call 3 $10.70 $14.95 $3,195.00
06/19/2007 O BTO .GPYGD - GS JUL 220 Call 3 $10.20 $14.95 ($3,074.95) $120.05
Total Realized Gain for GS $120.05
Total Realized Gain $5.26
See the commision ... 15Us dollars per trade. Today i donate US$135 to OX ... i think OX love me alot ... lol ... At least now when my trade goes wrong way i know how to make it back ... so not that bad ... and must have patient and calm when trading...
DO NOT FORCE TO TRADE ... Not everyday can make money and also There are Plenty of Opptunity for you to make profits ...
The chart dun bluff you ... the only problem is how you read it and analysis it. A good day overall especially in GS ... and also goog too ... ;D
Go with the waterflow... and you will benefit will the flow ... go against it or predict it ... you will have a miserable death ... well you may get Lucky sometimes ... so happy hunting ...
Tuesday, June 19, 2007
Psychology of Options Trading
What are the most important things you need to know about Option Trading?
- Not the strategies
- Not the tools
- Not the money
It is all about the psychology of the trader - emotion, mindset... There are alot of fear and greed in trading which are from the human beings. You will be asking when should i buy or when should i sell. Should i buy more to cover the lost or just cut lost. There will be alot of distration around you. From your family, friends and so call other gurus.
Example : A novice trader will buy and sell because a friend say the stock will be going up or down. The novice trader just trade by NEWS from the friend.
The Human brian is the most powerful tool that God has given to us. It can either make you or break you. If you cant control how your brain think and your emotion, dun trade. Just like when you are unsure of where is the stock going... moving up or down... DUN TRADE!!!
5 simple strategy to control your emotion and mind while Trading:
- Have a Strategy/plan
- Stick to the strategy/plan
- Set profits target
- Set stop loss
- Automate the Trade
If you follow the 5 simple strategy, you will be able to control your mind and emotion. You will be having a fun and stress-free time while doing trading. So have fun and trade happily.
- Not the strategies
- Not the tools
- Not the money
It is all about the psychology of the trader - emotion, mindset... There are alot of fear and greed in trading which are from the human beings. You will be asking when should i buy or when should i sell. Should i buy more to cover the lost or just cut lost. There will be alot of distration around you. From your family, friends and so call other gurus.
Example : A novice trader will buy and sell because a friend say the stock will be going up or down. The novice trader just trade by NEWS from the friend.
What your mind concieve, your mind can
achieve
The Human brian is the most powerful tool that God has given to us. It can either make you or break you. If you cant control how your brain think and your emotion, dun trade. Just like when you are unsure of where is the stock going... moving up or down... DUN TRADE!!!
5 simple strategy to control your emotion and mind while Trading:
- Have a Strategy/plan
- Stick to the strategy/plan
- Set profits target
- Set stop loss
- Automate the Trade
If you follow the 5 simple strategy, you will be able to control your mind and emotion. You will be having a fun and stress-free time while doing trading. So have fun and trade happily.
Monday, June 18, 2007
Internet Trading Brokers - Thinkorswim
Yo Guys today is the last topic on Internet trading brokers. I will cover Thinkorswim. Thinkorswim is a rather new internet trading brokers. They founded in 1999 and headquartered in Chicago, is a leading online brokerage company specializing in options.
They support retail and institutional traders through their own trading platforms which are widely recognized as the industry’s best for execution, professional analytics and real-time position management.
They have revolutionized the option industry by teaching and executing complex, non-directional option strategies with single-click functionality that has now become the industry standard. Thinkorswim continues to evolve the financial marketplaces by delivering products that benefit the customer whether you are hedging, speculating or enhancing returns.
Thinkorswim is like a combination of OX and IB. I shall elaborated further now.
Benefits:
- Nice chart like OX but only can stream a chart at a time
- Plenty of educational tools
- User friendly platform (easy to use the trading workstation)
- Rather cheap commision per trade ... 2.50 - 3 bucks
The trading workstation is more or less similar to OX. I would prefer thinkorswim than OX, but i will still use the chart from OX. The platform that i will use is IB because im a scapler and a day trader so i need the lowest commision rate platform. So What Kind of Platform you need ?
dun wait and go check it out yourself =P
They support retail and institutional traders through their own trading platforms which are widely recognized as the industry’s best for execution, professional analytics and real-time position management.
They have revolutionized the option industry by teaching and executing complex, non-directional option strategies with single-click functionality that has now become the industry standard. Thinkorswim continues to evolve the financial marketplaces by delivering products that benefit the customer whether you are hedging, speculating or enhancing returns.
Thinkorswim is like a combination of OX and IB. I shall elaborated further now.
Benefits:
- Nice chart like OX but only can stream a chart at a time
- Plenty of educational tools
- User friendly platform (easy to use the trading workstation)
- Rather cheap commision per trade ... 2.50 - 3 bucks
The trading workstation is more or less similar to OX. I would prefer thinkorswim than OX, but i will still use the chart from OX. The platform that i will use is IB because im a scapler and a day trader so i need the lowest commision rate platform. So What Kind of Platform you need ?
dun wait and go check it out yourself =P
Saturday, June 16, 2007
Interactivebrokers
Hey guys I just finish my exam ... phew!! what a relief ... okay as what i have promiss ... i shall continue with the internet trading brokers topic. Today i shall tell you guys about this very cool and sopiscated broker .
IT is none other than IB (Interactive Brokers)
Interactive Brokers conducts its broker/dealer and proprietary trading businesses on over 60 market centers worldwide. In its broker dealer agency business, IB provides direct access ("on line") trade execution and clearing services to institutional and professional traders for a wide variety of electronically traded products including options, futures, stocks, forex, and bonds worldwide. In its proprietary trading business IB engages in market making for its own account in about 6,500 different electronically traded products. Interactive Brokers Group and its affiliates now trade 18.7% of the world’s exchange traded equity options*, and executes approximately 500,000 trades per day.
Benefits of IB :
- One of the cheapest commision rate - approx 1US per Trade
- One of the Fastest streaming online trading plateform
- Able to perform Stop lost, conditional , double last , and all sort of automate commands
- Able to Keep track of all the stock if you do your due diligence
The only problem i find that is IB didnt give any charts or nice charts and also is quite complicated to trade on IB if you are a computer idiots. You will need to have a certain knowledge on computer to find it easy to trade on IB.
Nonetheless IB is still a professional trading plateform that use by many traders around the worlds. Even Conrad and Adam khoo are using it. If you are a day trader or short term trader, I would really recommend you to check IB out as they will really benefit your pockets. DANGER!! --> (able to fake the markets!!)
IT is none other than IB (Interactive Brokers)
Interactive Brokers conducts its broker/dealer and proprietary trading businesses on over 60 market centers worldwide. In its broker dealer agency business, IB provides direct access ("on line") trade execution and clearing services to institutional and professional traders for a wide variety of electronically traded products including options, futures, stocks, forex, and bonds worldwide. In its proprietary trading business IB engages in market making for its own account in about 6,500 different electronically traded products. Interactive Brokers Group and its affiliates now trade 18.7% of the world’s exchange traded equity options*, and executes approximately 500,000 trades per day.
Benefits of IB :
- One of the cheapest commision rate - approx 1US per Trade
- One of the Fastest streaming online trading plateform
- Able to perform Stop lost, conditional , double last , and all sort of automate commands
- Able to Keep track of all the stock if you do your due diligence
The only problem i find that is IB didnt give any charts or nice charts and also is quite complicated to trade on IB if you are a computer idiots. You will need to have a certain knowledge on computer to find it easy to trade on IB.
Nonetheless IB is still a professional trading plateform that use by many traders around the worlds. Even Conrad and Adam khoo are using it. If you are a day trader or short term trader, I would really recommend you to check IB out as they will really benefit your pockets. DANGER!! --> (able to fake the markets!!)
Monday, June 11, 2007
Internet Trading Brokers - OptionExpress
Do you know which online trading platform to setup?
Do you know that different online trading platform will suit differnt kind of trader?
Do you have difficulty on setting up an internet trading platform?
Today im going to share with you guys the BENEFITS of 3 trading platforms.
- Optionexpress (https://www.optionsxpress.com.sg/login.asp)
- Thinkorswim (http://www.thinkorswim.com/tos/client/index.jsp)
- Interactive Brokers (http://www.interactivebrokers.com/en/main.php)
Starting from optionexpress
--------------
Optionexpress
--------------
The best thing about optionexpress is they provide excellent tools. Tools like beautiful user friendly streaming charts that will help in your trading. you can choose to view it in candle stick, bar and line chart.
They let you to put up a watchlist and you can run it in streaming too. They also provide a virtual platform to polish up your skill and get familar with the tools. Easy to trade with option strategy like spread, straddle and strangle as spoon feed you with the neccessary key in option.
Well good stuff always come with a PRICE !!
Yesh they have an averagely high commision charges on per trades - US$14.95
So in acutal fact you will need to spend US$30 on just buy and sell the stock/option.
What i like and love most about optionexpress is the chart which has the following qualities:
- User friendly
- Informative
- Nice Candle Stick chart
- Easy setup TA chart - macd/dema/stochastic and many more ...
- Streaming
So i really recomand you guys to go check it out and play around with the chart. I wont recommend you guys to fund the account unless you are monthly/yearly trader aka investor or long term trader. So please do your due diligence before you act on it.
If you have any enquiry, just drop me a mail - akalawoo@gmail.com
Do you know that different online trading platform will suit differnt kind of trader?
Do you have difficulty on setting up an internet trading platform?
Today im going to share with you guys the BENEFITS of 3 trading platforms.
- Optionexpress (https://www.optionsxpress.com.sg/login.asp)
- Thinkorswim (http://www.thinkorswim.com/tos/client/index.jsp)
- Interactive Brokers (http://www.interactivebrokers.com/en/main.php)
Starting from optionexpress
--------------
Optionexpress
--------------
The best thing about optionexpress is they provide excellent tools. Tools like beautiful user friendly streaming charts that will help in your trading. you can choose to view it in candle stick, bar and line chart.
They let you to put up a watchlist and you can run it in streaming too. They also provide a virtual platform to polish up your skill and get familar with the tools. Easy to trade with option strategy like spread, straddle and strangle as spoon feed you with the neccessary key in option.
Well good stuff always come with a PRICE !!
Yesh they have an averagely high commision charges on per trades - US$14.95
So in acutal fact you will need to spend US$30 on just buy and sell the stock/option.
What i like and love most about optionexpress is the chart which has the following qualities:
- User friendly
- Informative
- Nice Candle Stick chart
- Easy setup TA chart - macd/dema/stochastic and many more ...
- Streaming
So i really recomand you guys to go check it out and play around with the chart. I wont recommend you guys to fund the account unless you are monthly/yearly trader aka investor or long term trader. So please do your due diligence before you act on it.
If you have any enquiry, just drop me a mail - akalawoo@gmail.com
Saturday, June 9, 2007
06/08/2007 O STC .GOPFU - GOOG JUN 510 Call 2 $9.00 $14.95 $1,785.02
06/08/2007 O BTO .GOPFU - GOOG JUN 510 Call 2 $7.60 $14.95 ($1,534.95)
06/08/2007 O STC .GOPFU - GOOG JUN 510 Call 2 $9.10 $14.95 $1,805.02
06/08/2007 O BTO .GOPFU - GOOG JUN 510 Call 2 $8.20 $14.95 ($1,654.95) $400.14
Total Realized Gain/Loss for GOOG $400.14
06/08/2007 O STC .GOPFU - GOOG JUN 510 Call 2 $8.00 $14.95 $1,585.02
06/08/2007 O BTO .GOPFU - GOOG JUN 510 Call 2 $8.90 $14.95 ($1,794.95)
lost 210
whaha ... ZzzZzz nvm .... first time cut i happy ... wao really hor if cant chase the bloody thingy just cut it ... GooG dun play play will die
oh cRAp ... got fool by GooG ... ZzzZzz but no regrete la ... i rather make 190 for today than none lol
yeah the main thing is dun make a lost... today im happy to make 200 buck =) quite cool about it... stick to the rule and you will not fall .. ...
06/08/2007 O BTO .GOPFU - GOOG JUN 510 Call 2 $7.60 $14.95 ($1,534.95)
06/08/2007 O STC .GOPFU - GOOG JUN 510 Call 2 $9.10 $14.95 $1,805.02
06/08/2007 O BTO .GOPFU - GOOG JUN 510 Call 2 $8.20 $14.95 ($1,654.95) $400.14
Total Realized Gain/Loss for GOOG $400.14
06/08/2007 O STC .GOPFU - GOOG JUN 510 Call 2 $8.00 $14.95 $1,585.02
06/08/2007 O BTO .GOPFU - GOOG JUN 510 Call 2 $8.90 $14.95 ($1,794.95)
lost 210
whaha ... ZzzZzz nvm .... first time cut i happy ... wao really hor if cant chase the bloody thingy just cut it ... GooG dun play play will die
oh cRAp ... got fool by GooG ... ZzzZzz but no regrete la ... i rather make 190 for today than none lol
yeah the main thing is dun make a lost... today im happy to make 200 buck =) quite cool about it... stick to the rule and you will not fall .. ...
Monday, June 4, 2007
What are Option Tradings
Have you wonder what are options?
Do you know that Options is a tool create to trade stocks especially for those expensive stocks.
Definition: An option contract is an agreement between two parties to buy/sell an asset (stock or futures contract as an example) at a fixed price and fixed date in the future.
It is called an option because the buyer is not obliged to carry out the transaction. If, over the life of the contract, the asset value decreases, the buyer can simply elect not to exercise his/her right to buy/sell the asset.
There are two types of option contracts - Call options and Put options. A Call option gives the buyer the right to buy the underlying asset, while a Put option gives the buyer the right to sell the underlying asset.
American options can be exercised anytime between the date of purchase and the expiration date. European options may only be redeemed at the expiration date. Most exchange-traded stock options are American.
A simple example: lawrence buys a Call option contract from Sarah. The contract states that lawrence will buy 100 Microsoft shares from Sarah on the 5th May for $25. The current share price for Microsoft is $30.
Note: this is an example of a Call option as it gives lawrence the right to buy the underlying asset.
If the share price of Microsoft is trading above $25 on the 5th May, then lawrence will exercise the option and Sarah will have to sell him Microsoft shares for $25. With Microsoft trading anywhere above $25 lawrence can make an instant profit by taking the shares from Sarah at the agreed price of $25 and then selling the shares on the open market for whatever the current share price is and making a profit.
The $25 value, which is stated in the agreement, is referred to as the Exercise (or Strike) Price. This is the price at which the asset will be exchanged.
The date (in this case 5th May) is known as the Expiry (or Maturity) Date. This date is the deadline for the option contract. At this date, the option buyer is to decide if a transaction of the underlying asset is to occur.
Outcomes: Let's imagine that at the expiration date, Microsoft is trading at $30, then lawrence will buy the shares from Sarah at the agreed $25 and then he can sell them back on the open market for $30 and make an instant $5.
Alternatively, if Microsoft is trading at $20, then buying the shares from Sarah at $25 is too expensive as he can buy them on the open market for $20 and save $5. In this situation, lawrence would choose not to exercise his right to buy the shares and let the options contract expire worthless. His only loss would be the amount that he paid to Sarah when he bought the contract, which is called the Option Premium - more on that a little later. Sarah would, however, keep the option premium received from lawrence as her profit.
In the real world of exchange traded options, transactions don't really take place between two people like I've explained above. The process of Novation actually removes the identity of who is on the other side of the trade. You simply Buy or Sell an option contract from the exchange without knowing who is on the other side.
Do you know that Options is a tool create to trade stocks especially for those expensive stocks.
Definition: An option contract is an agreement between two parties to buy/sell an asset (stock or futures contract as an example) at a fixed price and fixed date in the future.
It is called an option because the buyer is not obliged to carry out the transaction. If, over the life of the contract, the asset value decreases, the buyer can simply elect not to exercise his/her right to buy/sell the asset.
There are two types of option contracts - Call options and Put options. A Call option gives the buyer the right to buy the underlying asset, while a Put option gives the buyer the right to sell the underlying asset.
American options can be exercised anytime between the date of purchase and the expiration date. European options may only be redeemed at the expiration date. Most exchange-traded stock options are American.
A simple example: lawrence buys a Call option contract from Sarah. The contract states that lawrence will buy 100 Microsoft shares from Sarah on the 5th May for $25. The current share price for Microsoft is $30.
Note: this is an example of a Call option as it gives lawrence the right to buy the underlying asset.
If the share price of Microsoft is trading above $25 on the 5th May, then lawrence will exercise the option and Sarah will have to sell him Microsoft shares for $25. With Microsoft trading anywhere above $25 lawrence can make an instant profit by taking the shares from Sarah at the agreed price of $25 and then selling the shares on the open market for whatever the current share price is and making a profit.
The $25 value, which is stated in the agreement, is referred to as the Exercise (or Strike) Price. This is the price at which the asset will be exchanged.
The date (in this case 5th May) is known as the Expiry (or Maturity) Date. This date is the deadline for the option contract. At this date, the option buyer is to decide if a transaction of the underlying asset is to occur.
Outcomes: Let's imagine that at the expiration date, Microsoft is trading at $30, then lawrence will buy the shares from Sarah at the agreed $25 and then he can sell them back on the open market for $30 and make an instant $5.
Alternatively, if Microsoft is trading at $20, then buying the shares from Sarah at $25 is too expensive as he can buy them on the open market for $20 and save $5. In this situation, lawrence would choose not to exercise his right to buy the shares and let the options contract expire worthless. His only loss would be the amount that he paid to Sarah when he bought the contract, which is called the Option Premium - more on that a little later. Sarah would, however, keep the option premium received from lawrence as her profit.
In the real world of exchange traded options, transactions don't really take place between two people like I've explained above. The process of Novation actually removes the identity of who is on the other side of the trade. You simply Buy or Sell an option contract from the exchange without knowing who is on the other side.
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