Tales of a Technician: How Do I Make More Money?
June 7, 2022
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?
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