≈ Keep it in your pocket. ≈
Yesterday you’ve learned how options buyers profit. How do options sellers profit?
Profiting with options as a seller: To profit as an options seller, you must sell high and buy low.
Again, this is as simple as it gets. If options buyers profit by buying low and selling high, options sellers profit by taking the opposite route.
It doesn’t matter if you are selling a single put or an entire Iron Condor. If you enter the position with a net credit of $1, for example, the only way to exit this position with a profit is if you buy the contract back for less than $1.
“But how the price of the contract will drop?”, you might ask.
Time. If you refer back to the Absolute Truth #7—published on October 29th—you will see that time is your best ally as an option seller. You sell the contract for a price » time corrodes the price » you buy the contract back at a lower price » you pocket the profit.
You can download and print the flashcard HERE.
Chart of the Day
Profiting with options as a seller
Video of the Day
What are Options Greeks
The “Greeks” are a collection of statistical values that measure the risk involved in an options contract in relation to certain underlying variables.
Today’s Lineup
Tales of a Technician
3 Lessons Learned from a Spooky October
In light of October’s bloody departure, a pivot is in order for today’s edition of ‘The Month That Was” series. I’m hopeful it will be a bullish pivot sending my commentary along an upward trajectory. Rather than follow the usual format I’ve compiled a list of lessons that we all should have learned (or re-learned) from the crash. The market provided the tricks; I’m providing the intellectual treats.
Coaches Lounge 11am EST
Join the coaches in this live lounge, ask questions, discuss ideas or just sit back and listen to veteran traders discuss market conditions.
The Coaches Show Replay
If you missed last night’s episode where Coach Noah and Coach Gino talked about Day Trading Based on News and Events or would like to watch it again, check it out here.
Tackle 25 Master Mind Group 8:30PM EST
Join and learn how to better use the Covered Call System with the Tackle 25.
Halftime Report 12:30pm 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.
Market Recap 4:30pm EST
The Market Recap is designed to give you a quick overview of the day that was. While brief, this report is designed to cover all of the major events that drove the markets that day and help you plan for the trading day ahead.
Episode 294: Storing Wealth An Interview with Kirk Chisholm
Today on the Trading Justice podcast we invite Kirk Chisholm of Innovative Wealth. Kirk is a seasoned vet and has some incredible nuggets of gold for our listeners.
