The number of ideas for how to answer this question necessitated a video so I could flesh out my thoughts without writing a book. So, here you go.
Notes
I have noticed in setting up trades especially options that profits seem low. Example: You may be risking 2k just to make $80.
Naked Put/Bull Put Spread = Risking a lot to make a little with a higher POP.
- Strategy Selection: To make more money, you could use more aggressive directional strategies.
- Long call, bull call spread, BWB, OTM flies
- PROBLEM: It requires more skill and market timing.
- Skillset & Track Record: It doesn’t me any good to shoot for the moon with aggressive strategies if I lack the ability to generate consistent profits.
- Trade More Often: I trade 1x a month. You trade 1x a day. Increasing Frequency of Trades.
- Casino: Positive expectancy. The sole objective is to get people to play more games.
- Trading Strategy XYZ: Positive expectancy. I’m incentivized to trade it more often.
- Trade Bigger: Increase Size of Trades. Normally risk $100 per trade. Start risking $150 per trade.
And of course, if you buy more contracts you’re adding more risk, then you have to wait months to make that profit.
Most people are retired or want money where they can spend it now rather than put it in an IRA.
How you make money and what you do with the money are 2 separate issues.
- Aggressive directional trade: Long calls: growth strategy: Make money and then pull it out every week to pay some bills.
- Conservative/theta trade: Naked Put/Covered Call: cash flow strategy. Make money and keep it in the account to grow/compound.
What is the prerequisite to pulling money out of your account to generate income TODAY without stealing all the principles in the account?
How can you increase your profit and make money sooner than later?
- Naked Put: Do a bull put spread instead and maybe do more contracts which results in a higher payout.
I’m assuming that’s the purpose and what cash flow strategy is. Is the bottom line that you have to do more trades?
Read more Tales of a Technician [FREE Content]
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.
Legal Disclaimer
Tackle Trading LLC (“Tackle Trading”) is providing this website and any related materials, including newsletters, blog posts, videos, social media postings and any other communications (collectively, the “Materials”) on an “as-is” basis. This means that although Tackle Trading strives to make the information accurate, thorough and current, neither Tackle Trading nor the author(s) of the Materials or the moderators guarantee or warrant the Materials or accept liability for any damage, loss or expense arising from the use of the Materials, whether based in tort, contract, or otherwise. Tackle Trading is providing the Materials for educational purposes only. We are not providing legal, accounting, or financial advisory services, and this is not a solicitation or recommendation to buy or sell any stocks, options, or other financial instruments or investments. Examples that address specific assets, stocks, options or other financial instrument transactions are for illustrative purposes only and are not intended to represent specific trades or transactions that we have conducted. In fact, for the purpose of illustration, we may use examples that are different from or contrary to transactions we have conducted or positions we hold. Furthermore, this website and any information or training herein are not intended as a solicitation for any future relationship, business or otherwise, between the users and the moderators. No express or implied warranties are being made with respect to these services and products. By using the Materials, each user agrees to indemnify and hold Tackle Trading harmless from all losses, expenses and costs, including reasonable attorneys’ fees, arising out of or resulting from user’s use of the Materials. In no event shall Tackle Trading or the author(s) or moderators be liable for any direct, special, consequential or incidental damages arising out of or related to the Materials. If this limitation on damages is not enforceable in some states, the total amount of Tackle Trading’s liability to the user or others shall not exceed the amount paid by the user for such Materials.
All investing and trading in the securities market involves a high degree of risk. Any decisions to place trades in the financial markets, including trading in stocks, options or other financial instruments, is a personal decision that should only be made after conducting thorough independent research, including a personal risk and financial assessment, and prior consultation with the user’s investment, legal, tax and accounting advisers, to determine whether such trading or investment is appropriate for that user.
