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Tackle Today: Money Management & Portfolio Protection

August 5, 2022

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«Build a Moat.»


The idea of portfolio protection is simple. Take steps that ensure you don’t blow your dough. Drawdowns are inevitable. You will see your account value dip from time to time. But the size of the slide is altogether in your control.

Here are three ways to ensure you’re not exposed to an unnecessarily large crash.

1. Position Size

Position size appropriately. Don’t risk too much in any one position and don’t have too many trades going than you can handle if they all move in the wrong direction.

2. Stop Losses

Use stop losses and have an exit strategy. There’s nothing wrong with being wrong. There is something wrong with staying wrong so long that you dig a pit that takes you years to climb out of.

3. Portfolio Protection

Buy portfolio protection via puts and put spreads. You could purchase these on individual positions or be more efficient and do it directly on an index or ETF like SPX or SPY. As you live through multiple corrections and bear markets, you’ll learn which methods you like most.

Video Of The Day: How to Use Put Options as Insurance

Coach Noah explains what a Put Option is, how to and why you should use it as insurance.

Chart of the Day: Bitcoin Futures (/BTC)

Chart of the Day: Bitcoin Futures (/BTC)

Bitcoin is oiling nicely beneath the 50-day moving average. Is an upside breakout imminent?

Options Theory Blog

The Bear Lover System

A team member pitched me an intriguing options selling system. It involves super short-term options and delta hedging. Here’s my review.

Today’s line up

Traders Lounge 11 AM EST

Join the coaches in this live lounge, ask questions, discuss ideas or just sit back and listen to veteran traders discuss market conditions.

Cash Flow Club Replay

If you missed last night’s webinar with Coach Greg Holmes where he talked about In The Money Covered Calls or would like to watch it again, check it out here.

Halftime Report 12:30 PM EST

The Halftime Report starts at 12:30 EST and covers what news is driving the market, chart analysis from the movers and shakers of the day, and fun in a way that only Matt and Tim can deliver.

Tackle Trading: Financial Freedom is a Journey. Sign up now for a 15-day free trial.

Financial freedom is a journey

Sign up now and gain unfettered access to all of the quality content and powerful Scouting Reports that our Pro Members enjoy for 15-days absolutely free with no strings attached and let us show you what your trading has been missing.

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Holiday Sale

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The Annual Holiday Sale is here!

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