Money Press Cheat Sheets

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Luke Bradford
5 years ago
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2 Important Disclaimer Traders Edge Network, llc, its members, subsidiaries and staff shall not be liable for any damages, either directly or indirectly arising out of the use of the Money Press manual, Money Press training video(s), or Money Press CD(s). This includes, but is not limited to trading loss, anticipatory profits, or consequential damages resulting from the use or misuse of these products. It should not be assumed that the trading recommendations, advice, methods, techniques or indicators will not result in losses. Trading involves risk of loss as well as the possibility of profit. Past performance is not a guarantee of future results. All investments and trades carry risk, and all trading decisions remain the responsibility of that individual. While reasonable efforts are made to ensure the accuracy of the information, Traders Edge Network, llc does not assume any liability resulting from errors or omissions contained therein. Traders Edge Network, llc is NOT a licensed stockbroker or investment advisor. You should always seek the advice of a competent investment professional prior to making any trade or investment decision. NO ADVICE IS GIVEN OR IMPLIED! Traders Edge Network, llc, its owners, or its representatives may hold positions in the securities mentioned in this course or in this training at any time. However, in no way is Traders Edge Network, llc soliciting an offer to purchase or sell securities mentioned. This is not a solicitation to buy or sell stocks and/or securities of any kind. If you do not understand this, please return this product immediately! WARNING These Cheat Sheets are NOT Meant to Replace a Thorough and Complete Study of the Entire Money Press Method!

3 The Money Press Cheat Sheets Money Press Overview: Objective: Generate weekly income from selling weekly puts. Protected with longer term, out-of-the-money puts. The Money Press works especially well when there s sideways to bullish moves in the underlying stock. Length of the trade: Typically around 6-12 weeks Entry: Any day of the week (no restrictions) Market Cycle: Preferably an accumulation cycle, but not a requirement (see my 1% Solution manual for complete details) Pre-Requisite Compelling Circumstances: Your stock choice MUST have at least one of the following circumstances. If there are more than one of these events happening around each other on the calendar odds are even better for success, but only ONE circumstance is required to have a quality Money Press : Pre-Announcement of Better Than Expected Earnings Anticipation/Rumors of a New Product Launch Ideal setup (see my 1% Solution manual for complete details) The Crow-Bar set-up (see my Weekly Options Windfall training for complete details) Stock Split Announcement CONTINUED ON NEXT PAGE

4 Sunrise-Demise setup (see my 1% Solution manual for complete details) Others: Hot/New Industry Bullish Sentiment *Important* all of the above circumstances MUST be confirmed by the crowd, which means: price action & volume! Stocks and Securities to Avoid When Using the Money Press : (click Profile for any ticker symbol on Yahoo Finance and it will immediately spell out what the company does) Anything that's commodity based: oil, gas, crops, fertilizer, gold, silver, anything metal! (natural disasters, sudden fears, government regulation, wars, etc kills our edge with these securities) ETF s. Surprisingly, most ETF s suck for Money Presses (with the exception of doing some hedging when the market's dicey, e.g.: VXX) Anything earthy like wind or solar (the government can change funding at the drop of a hat) Most clothing retailers (the dreaded same store sales report is just too unpredictable) I'm also not fond of semi-conductor, grocery store and most restaurant stocks Everything else is fair game!

5 Money Press Mechanics Set-up Qualifiers STEP 1: Your stock MUST have at least ONE of the Pre-Requisite Compelling Circumstances listed below in order to qualify for a Money Press. Which circumstance is your stock in? (Check all that apply): Pre-Announcement of Better Than Expected Earnings Anticipation/Rumors of a New Product Launch Ideal setup The Crow-Bar set-up Stock Split Announcement Sunrise-Demise setup Others: Hot/New Industry Bullish Sentiment STEP 2: You MUST always check your stock s next earnings date. Do NOT start a new Money Press if the next earnings announcement date is less than 2 weeks away! My stock s next earnings date:. If your stock has an earnings date less than 2 weeks from today it does NOT qualify for a Money Press trade. (Not yet anyway, better to wait until after the earnings announcement THEN SEE if it qualifies!) If your stock s earnings date is good-to-go, go to the next step

6 SET-UP TIPS: Given the choice between a double-digit stock and a triple-digit stock, I go with the triple digit stock An ideal Money Press set-up for me happens in-between earnings announcements during the 12 weeks in between. In other words, you ll ideally start a Money Press after a positive crowd reaction to earnings, then manage it for the 12 weeks leading into the next earnings announcement Warning: Don't be tempted to move up the protective put strike price simply to decrease the risk/margin requirement. We select our strike prices for a reason! If ONE contract is too much risk for your account, then pass on the trade!

7 Money Press Trade Entry Guidelines STEP 3: Enter Your Order Enter both option legs at the same time this is called a spread Always do LIMIT ORDERS when doing a spread order When first starting a Money Press trade, you will always enter the order as a debit Sell an AT-THE-MONEY weekly put Buy a 2-6 month out put for protection (equal to the number of contracts as your SELL) Here s a guideline for how far out-of-the-money I like to buy my put protection: Take the at-the-money weekly put premium, multiply that premium by two or three, and your put protection should cost right around that much (in other words, you should pay for the protection in two to three weeks). Here s the formula: (At-the-Money Weekly Put Premium) X 2.5 = (Approximately How Much Your Put Protection Should Cost)

8 Money Press Maintenance STEP 4: Rolling Out Every Friday, you will Buy-to-Close the weekly put that is about to expire Then SELL the next week s at-the-money put. Doing these two things is what I call Rolling Out Which is a Fancy Term for Adjusting Your Weekly Options TIPS for Rolling Out: If your stock is bullish and holding strong, opt to sell slightly in-the-money puts for next week. If the stock is acting uncertain, sell the slightly out-of-the-money puts for next week. Rolling out can also be done on Thursday (when the new weekly options come out). The goal with rolling out (adjusting your weekly options) is to leave as little time value left in them at the end of the week as possible! Very small time value can exist in both in- and out-of-the-money options at the end of the week. The options that are stubborn with the most time value remaining are the at-the-money options even with minutes left to go on Friday! CRITICAL: Don t allow your option protection (your insurance) to become less than 6 weeks away from expiration. To avoid this problem, you simply roll your put protection out to a longer term put

9 Money Press Maintenance (Continued) If you re able to collect just 2 weekly premiums, your Money Press trade has very little risk left! This creates more cash available in your account to trade. You can choose to make this Money Press bigger in size, or, you can start a brand new one. Compelling factors such as positive surprises, good news, a strong trend, price action, and volume help you decide whether to add to a current Money Press. The tip-toe burglar can be employed when rolling out. This allows for your current week s option to expire worthless WHILE you get next week s selling underway before the weekend starts. (see my Weekly Options Windfall training for complete details) IMPORTANT: Print out a calendar for the current AND next month. Pay close attention to any market holidays, 3-day weekends, shortened trading days, planned earnings announcements, analyst days, etc. Consider mixing in some boring stocks along the way. The exciting stocks can take a hit some weeks, but the sleepers in your portfolio mix can be there to help smooth things out. TIP: I prefer raising up my put protection when I don t have to! In other words: when the stock is acting bullish or reacting positively to some surprise good news. Versus the opposite: adjusting it because I have to (the stock is dropping or otherwise freaking out)

10 Money Press Exit Triggers Exit Trigger 1 When Earnings Are Coming Up: Conservative approach exit the Friday before earnings. Aggressive approach sell a put over the earnings announcement like usual (premiums during the week of earnings are enormous, usually 2-3 times normal!) If you do this, consider tightening up your protective put. Evaluate how far ahead you are on this specific Money Press position. Consider selling a further out-of-the-money put the week of the announcement to allow for more wiggle room If the stock makes a new 30-day low 2-3 weeks before the earnings announcement, ALWAYS trade it using the conservative approach! (see above) Exit Trigger 2 When a Stock Split is Coming Up: Exit the Friday before the split is scheduled to take place Other Reasons to Consider Exiting Include: You discover news the CFO has decided to resign from the company and pursue other interests. The stock has broken down below a key moving average, and stayed there. (i.e. 50, 100 or 200 day) The company does a secondary offering of shares A negative pre-announcement of weaker than expected earnings per share, sales, or revenues A surprise visit from federal regulators or other news/rumors of pending government action. Multiple downgrades by the analyst cartel members.

11 Money Press Defense Adjustments to Consider Making During a Market Correction : If there s a 2-grade drop* in IBD or if we re having over-bought conditions, consider tightening up your put protection If there s a 2-grade drop* in IBD or if we re having over-bought conditions, consider selling further out of the money puts (your weekly short puts) Sell fewer of your weekly short puts (this is called ratio-ing) If there s a 2-grade drop* in IBD, consider adding puts on your stock and/or the broad markets (i.e. SPY or calls on FAZ) If there s a 2-grade drop* in IBD, consider adding a hedge position. For example, if FAZ 26.27: Sell the at-the-money 26.5 puts =.70, Buy the 1-3 month out 24 puts =.92 Margin requirement / risk = $250, Potential weekly ROI = approx. 20% You can use a larger position size if you are protecting several trades VXX Money Presses can also be done as a hedge Buy shares, or call options, of inverse, leveraged ETF s like QID Build a bearish Money Press (sell ATM weekly calls, buy OTM several month out calls for protection) * The two-grade drop in IBD is explained in detail in my 1% Solution manual and in my Weekly Options Windfall training. Call Lori to find out more at

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Options Mastery Day 2 - Strategies

Options Mastery Day 2 - Strategies Day 2 Agenda 10:00-10:10 - Overview and Q&A from Day 1 10:10-11:00 - Morning Trade Walk Thru & Trade Plans 11:00 12:00 - Options 101 Review & Long Call/Put Criteria 12:00-12:15