HOW TO FIND PROFITABLE TRADES IN TODAY'S MARKET with Don Kaufman

Size: px

Start display at page:

Download "HOW TO FIND PROFITABLE TRADES IN TODAY'S MARKET with Don Kaufman"

Virginia Tucker
5 years ago
Views:

1 1 HOW TO FIND PROFITABLE TRADES IN TODAY'S MARKET with Don Kaufman

2 2 Risk Disclosure We Are Not Financial Advisors or a Broker/Dealer: Neither TheoTrade nor any of its officers, employees, representatives, agents, or independent contractors are, in such capacities, licensed financial advisors, registered investment advisers, or registered broker-dealers. TheoTrade does not provide investment or financial advice or make investment recommendations, nor is it in the business of transacting trades, nor does it direct client commodity accounts or give commodity trading advice tailored to any particular client s situation. Nothing contained in this communication constitutes a solicitation, recommendation, promotion, endorsement, or offer by TheoTrade of any particular security, transaction, or investment. Securities Used as Examples: The security used in this example is used for illustrative purposes only. TheoTrade is not recommending that you buy or sell this security. Past performance shown in examples may not be indicative of future performance. Return on Investment ROI Examples: The security used in this example is for illustrative purposes only. The calculation used to determine the return on investment ROI does not include the number of trades, commissions, or any other factors used to determine ROI. The ROI calculation measures the profitability of investment and, as such, there are alternate methods to calculate/express it. All information provided are for educational purposes only and does not imply, express, or guarantee future returns. Past performance shown in examples may not be indicative of future performance. Investing Risk: Trading securities can involve high risk and the loss of any funds invested. Investment information provided may not be appropriate for all investors and is provided without respect to individual investor financial sophistication, financial situation, investing time horizon, or risk tolerance. Options Trading Risk: Options trading is generally more complex than stock trading and may not be suitable for some investors. Granting options and some other options strategies can result in the loss of more than the original amount invested. Before trading options, a person should review the document Characteristics and Risks of Standardized Options, available from your broker or any exchange on which options are traded. No part of this presentation may be copied, recorded, or rebroadcast in any form without the prior written consent of TheoTrade. No Soliciting. No Recording. No Photography.

3 3 Copyright Disclaimer All rights reserved. This Material may not be reproduced or distributed, in whole or in part, without prior written permission of TheoTrade, LLC. Any other reproduction or distribution, in whatever form and by whatever media, is expressly prohibited without the prior written consent of TheoTrade, LLC. For further information, please contact: TheoTrade, LLC N. Scottsdale Rd. # 410 Telephone: support@theotrade.com

4 4 Don Kaufman Co-Founder and Lead Instructor at TheoTrade Industry-leading options strategist Derivatives Risk Manager 20 year trading career 18 years of thinkorswim platform experience

6 Copyright 2017 TheoTrade, LLC. All Rights Reserved 6 About TheoTrade TheoTrade Specializes in education for options, futures, and stocks. Founded by professional traders and trading educators each with a minimum of 15 years experience, several with many decades TheoTrade is here to help you mitigate the risks in the market, while learning a skill set that can last a lifetime.

7 Your TheoTrade Instructors Jeff Bierman Analyst, Trader, & Former Chief Technician for TD Ameritrade Matt Williamson market neutral/premium selling options strategist Corey Rosenbloom Senior Strategist & Swing Trader Brandon Chapman CMT Macro Economics, Technicals and Fundamentals Steve Slim Miller - 43 year veteran stock, options, futures trader Tony Rago - Nasdaq Futures and Intraday Strategist

8 Copyright 2018 TheoTrade, 8 LLC. All Rights Reserved A Horizon of Interest Rate Risk Look to the horizon, what do we see? FMOC and Central Bankers interest rate policy Central Banks Buying of Corporate Debt and ETFs $8 trillion of negative yielding debit (negative interest rate policy) Chinese Debt at 317% of GDP Chinese banking system grew 1000% in 10 years $1.6 trillion in Student Load Debt with 42% delinquent, postponed, or in default Brexit Global Currency Devaluations

9 9

skill set, for we are no longer in a market whereby monkeys throwing darts can be

11 Copyright 2018 TheoTrade, LLC. All Rights Reserved 11 Gotta have Skills Moving Forward A trader must acquire a skill set, for we are no longer in a market whereby monkeys throwing darts can be profitable. Advisors, mutual funds, indexing capital (etfs), or a mix of bonds will likely underperform the traders in the years to come.

12 Copyright 2017 TheoTrade, LLC. All Rights Reserved 12 The writing is on the Wall literally! The FED will continue to raise rates and contract the balance sheet, Central Banks around the world have already started to follow suit. Trading and investing moving forward is going to be a mix of both LONG and SHORT positions, getting purely LONG (aka a BULLISH BIAS) will be a serious mistake. Many are familiar with long markets and bullish bias strategies, allow us to turn the table and bring into focus a much needed skill

You need to be smarter than your competition!

15 Copyright 2017 TheoTrade, LLC. All Rights Reserved 15 Let s Get SHORT the markets Allow us to briefly review the structure, risks, and logic of getting short the market. Shorting is in effect selling shares we do NOT own. How can you sell something you have never owned? Shares we short are borrowed from our broker and SOLD with the intent of later buying them back at a lower price.

16 Copyright 2017 TheoTrade, LLC. All Rights Reserved 16 Short STOK Example We Short $135 per share STOK value declines and we buy it $95 per share Net profit $40 per share Now lets get to a few real deal examples!

17 Copyright 2017 TheoTrade, LLC. All Rights Reserved 17 Finding a Short Candidate Knowing interest rates are rising what might be a viable SHORT candidate? Now remember the writing has been on the wall for rising rates for many months!

Copyright 2017 TheoTrade, LLC. All Rights Reserved 19 Short positions have some issues Short positions technically have UNLIMITED risk to the upside?

19 Copyright 2017 TheoTrade, LLC. All Rights Reserved 19 Short positions have some issues Short positions technically have UNLIMITED risk to the upside? Think about it, you short a stock and it could run UP indefinitely. If you do not believe that, well look at an AMZN chart! Short positions tie up heavy amounts of capital and margin. Short positions cannot be placed in a retirement accounts! Short stock holders MUST pay dividends!

21 21 Getting Short without Shorting the STOCK! In our aforementioned example we shorted shares of XHB. In substitute of the short shares we can elect to BUY a put option contract. The put option will limit our risk to the premium paid and provide us with an outstanding downside potential! Buying the 48 put defines our risk to less than $3 per share and provides stellar downside capabilities. The KEY here is knowing the right PUT to BUY!

23 Copyright 2017 TheoTrade, LLC. All Rights Reserved 23 Why We Use a Put in Place of Short Shares Buying the put option is nearly equivalent to being short the stock. Ties up minimal margin Can be done in a retirement account Limits risk and upside exposure Put buyers do NOT pay the dividends! The put can be held for an indefinite period of time with the use of a ROLL.

25 Copyright 2017 TheoTrade, LLC. All Rights Reserved 25 Sell Premium against your shorts! In another position I am LONG the Morgan Stanley puts Can I sell a short dated may 4 th expiration 53 put against the put that I am long? Yes and in doing so I collect and additional $.60 in the next 11 days!

27 Copyright 2017 TheoTrade, LLC. All Rights Reserved 27 Skew, Love it or Leave it! There are some distinct advantages of being short! The options market favors the sale of PUT options in what is termed SKEW. In effect, you collect more options premium for selling put options!

28 Bears Befriend Skew 28

29 Copyright 2017 TheoTrade, LLC. All Rights Reserved 29 Selling Premium Against our PUTS! Selling short dated options against our longer dated puts Brings in a weekly income stream. 2. Lowers our cost basis in the put we purchased. 3. Via bringing in weekly premium we can profit even when a stock stays flat or range bound. 4. Takes substantially LESS risk than shorting the stock. 5. Selling put places the options skew in our favor.

30 Copyright 2017 TheoTrade, LLC. All Rights Reserved 30 How to Collect Income being Short The idea is easy; we want to achieve maximum reward for a minimal upfront risk and be capable of selling options premium! Limit your exposure and maximize your premium selling potential!

37 Copyright 2017 TheoTrade, LLC. All Rights Reserved 37 Fear NOT Collecting Income being Short You may not know options OR have limited experience in placing options trades. DO NOT let options intimidate you! You need these strategies for the forseeable market future! We can show you HOW and WHEN to place these trades in a matter of a few hours. TheoTrade creates detailed recipes for every strategy including Collecting Income being Short You would not bake a cake without a recipe, so why trade without one?

47 Copyright 2017 TheoTrade, LLC. All Rights Reserved 47 Trading is about Answering the What Ifs What might be a good stock or ETF candidate for a short position? What is the correct options expiration cycle to buy put? How much capital do I commit to these positions? What Strike Price Options do I sell and how many? What Strike Price Options do I buy?

48 Copyright 2017 TheoTrade, LLC. All Rights Reserved 48 TheoTrade Has Your Answers We Build Recipes with definitive criteria and checklists for each strategy and each unique variable you will encounter.

50 Copyright 2017 TheoTrade, LLC. All Rights Reserved 50 The Secret is in the Sauce Now you may be thinking hey I can read about this strategy anywhere and can do this; well think again The following strategy and corresponding criteria requires the utmost attention to detail. We spent YEARS fine tuning this trade setup and criteria, when we approach the section on criteria FOLLOW the STEPS to build a trade! Here is how YOU can Collect Income being Short

51 51 How to Collect Income Being Short Workshop Curriculum How to short the market with very little capital so you can collect income even from a small account How to use options to short so your risk is minuscule compared to shorting stock Discover how you can create short positions in any retirement account so you never miss an opportunity How to easily identify the most promising short candidates while minimizing your risk so you always have an edge Proven strategies used by seasoned traders to sustain short positions while waiting for volatility to strike so you can to A rarely looked at tool called "Options Skew" and how it can help you finance your short positions so you finally have the insider secret

52 52 How to Collect Income Being Short Workshop Curriculum Discover the step by step criteria for selling the right options so you can eliminate the guess work and get results What the advantages and disadvantages are of selling short dated or weekly options so you can even collect weekly income Discover the benefits vs risks of using Inverse ETFs and "Synthetic Short" Positions for IRA or retirement accounts How to determine the position size so you know how much to risk in any market condition At last learn how to roll your short positions without sitting in front of a computer throughout the trading day so you can collect income from the market event if you have another job.

53 Copyright 2018 TheoTrade, LLC. All Rights Reserved 53 How to Collect Income being Short Trade Instructor: Don Kaufman 3 hour course is available immediately with 24/7 access Class slide deck that includes entry and exit criteria checklist available immediately for download. $297 *Class qualifies you for a reduced commissions rate*

54 Copyright 2018 TheoTrade, LLC. All Rights Reserved 54 You ve been there done that Many of you tuning in have been through the gauntlet of paid classes, indicators, secret squirrel black boxes and more Only to find just BUY this one last thing to make all the difference? But wait there is more! We at TheoTRADE have had enough of the educational garbage and sales pitches and we intend to put and end to it!

55 Copyright 2018 TheoTrade, LLC. All Rights Reserved 55 Disrupt Financial Education! TheoTRADE is built by professional traders with a minimum of 15 years experience, not professional salespeople. Educating you is our ONLY goal and we will demonstrate it. Today we shall forever change the way you view education Introducing TotalTheo Unlimited Streaming Monthly Membership!

56 Copyright 2018 TheoTrade, LLC. All Rights Reserved 56 TotalTheo Unlimited ONLY $99 per month How to Collect Income being Short Workshop is INCLUDED in the TotalTheo Unlimited Monthly Streaming Membership ACCESS to OVER 73 Trading Classes! ALL available immediately On-Demand New Monthly Classes Live Trading Chat Room: Traders Provide Real Trade Ideas and Real-Time Market Insights and Analysis broadcasting live 6 hours per day. Indicators 59 proprietary indicators and scans. ed Trade Ideas Daily Coaching Sessions with Timely Topics on Stocks, Options and Futures Instructors directly answer your trading questions via ! TheoTrade.com/puts

57 What Members are Saying: 57

58 Copyright 2018 TheoTrade, LLC. All Rights Reserved 58 It s As If We Are Giving You $200, Take The Money How to Collect Income being Short $297 one time fee How to Collect Income being Short TotalTheo Unlimited Streaming $99 per month How to Collect Income being Short Over 73 classes New monthly classes Daily live trading and chat room Archived 24/7 ed trade ideas Trading indicators and scans Daily coaching sessions

60 What Members are Saying: 60

7:00 pm Central Time

Live @ 7:00 pm Central Time 2 Trading Strategies for Impending Volatile Markets with Don Kaufman 3 Risk Disclosure We Are Not Financial Advisors or a Broker/Dealer: Neither TheoTrade nor any of its officers,