Hey guys, what are your key takeaways from this episode? IMPORTANT: We would like to remind the TIP Community to beware of cyber scams & phishing attacks. We have received reports of fake accounts claiming to be affiliated with The Investor’s Podcast Network or posing as one of our hosts. Please help us report those suspicious accounts. We will never reach out to you for any business or investment opportunity. Stay vigilant!
Tom acts like this is very easy and anyone can do it. Investing with options and futures is extremely difficult and takes time and a very good education on the markets. Tom is gifted and works 24 hours a day. If it was easy no one would be poor, homeless, and working a job they hated. Many try to learn this business for years and go broke. It requires hard work but you must also be very smart to be successful.
That is why his company invests so much in educating investors. His principles are simple and based on mathematics. I've been doing it a couple of years now and I don't bother looking at news, annual reports or other things people consider research. I may look at a chart to consider support and resistance for a directional trade, but it's all based on time decay. You sell an option, collect a premium and all other things being equal it will decrease in price so you can buy it back and pocket the difference. Read the Unlucky Investor where they explain it all. It has a lot of math, but you don't need to read it if you're not interested. You can skip to the conclusions to get the gist of the model. It's a two day read.
I will attest that it does take education and skill. However, The rule based system they use is backed full of logical and well defined parameters that beat the house more often than not. I have been in this game 15 years thinking I could learn the Long/short trade game and be successful. 50% win rate coupled with money management is more stressful and lends to money management mistakes that can rekt you. WIth the Sells premium you can market to market your worth everything day and adjust your risk profile like a Insurance company.
I like listening to him. His investment style is so different from someone like Buffett who trades based on simple value and keeping those investments which can continue to compound their earning over time which is utilized to come up with PV of stock prices based on future earning.. typically 10 years. Buffett is always looking at the financials and real value versus the daily trading as described here which seems to be nearly completely focused on a type of risk management of the options market. It's interesting that he says he doesn't adhere to using charts and technical indicators commonly known to be used by stock day traders.
Buffets has been known for decades to use Options in investing through the use of Butterfly's. This single approach helped net valuable positions in long stock as he gets pays to reach the entry target. Options can be Risk adverse or high risk. The math, the structure of option is open for any stagiest to deploy at their discretion.
For all the listener out there confused by Tom's approach I am here to testify it is the most likely outcome to win over time. I doesn't mean you have to be exclusive with it but it can buffer your losses while you hunts for big winners. It can pay consistently at higher returns than Cash or bonds payments. It is for the more active person. Sell Puts and other sells premium strategies lets you control your risk very efficiently. It changed my Trading Philosophy. I hate loosing and don't mind Win small a thousands of times. The hire commission cost still net a more consistent return.
When is the TastyTrade methodology going to be documented in a well written and comprehensive book. Why hasn't Sosnoff hired a technical writer to produce such a valuable text.
Just a pity they don't seem interested in building paper trading into the platform as they did with Think or Swim as the TT platform is a bit intimidating for beginners.
I've traded option a bit and it's been addictive. I can spend my whole day in front of the monitor and trade and "don't give a crab" about the companies and if they are providing good and services that move humanity forward. It is a bit scary what humanity will be liked in the future. Will everyone have a price tag as the base and chances of upward rewards or downward liability. In which, they may loose their place or even their life. :)
Almost anything can be addictive. Look at food. We are surrounded by risk and danger. Options traders provide a valuable service to the markets by providing liquidity and pricing efficiency. For some people it's just a fun game and doesn't have to have any meaning beyond that and that's not necessarily a bad thing.
He is constantly closing them and taking high probability low profit and thus low risk trades, so its like rolling the dice but winning more than 50/50 of the time.
I think you could if you had a clear plan laid out as to what you're going to do under each circumstance and you set up a way to effectively monitor.. maybe even some automatic trading. . It seems to be second nature for him. Probably doesn't even think about it. His key is to keep the positions small.. so he probably can afford to miss a few things although he indicates it doesn't matter to him and it probably doesn't.. he see's it as a job he loves doing.
they also count fills. you may have a big position you exit 10% at a time so "one trade was 10" and that could be 10 min or an hour, (edit so 10 "trades" could be 100 fills 'actual trades on the ledger') then add in swings you held ands its always rolling.
Warren Buffett is the worlds biggest options trader. Over 45% of his portfolio is in Apple and he knows how to leverage options to multiple his profits.
Technical analysis and market history help you predict the market and improve your odds of success with options. Not knowing the potential direction of the market and stocks is investing blind. You need to know when to buy/sell a call/put. Knowing technical analysis improve your odds of success.
The charts are terrible, no built in paper trading, and delayed quotes until you fund your account. In addition, they clear through APEX which is a shady FCM. They remind me of the now defunct MF Global.
Hey guys, what are your key takeaways from this episode?
IMPORTANT: We would like to remind the TIP Community to beware of cyber scams & phishing attacks. We have received reports of fake accounts claiming to be affiliated with The Investor’s Podcast Network or posing as one of our hosts. Please help us report those suspicious accounts. We will never reach out to you for any business or investment opportunity. Stay vigilant!
I become a Tom and TastyTrade fan several days ago and it already pushed me to the next level. Love it. Thanks for the interview
quote of the day "In order to win, you have to experience things"
Really good questions towards the end. Thank you for doing this.
Been a fan of Tom for so long, wow, this was a great interview. Thanks Trey, you did a great job.
38:19 WOW.. just blew me straight out of the water. This guy is incredible. Great Show, Great interview!
Tom acts like this is very easy and anyone can do it. Investing with options and futures is extremely difficult and takes time and a very good education on the markets. Tom is gifted and works 24 hours a day. If it was easy no one would be poor, homeless, and working a job they hated. Many try to learn this business for years and go broke. It requires hard work but you must also be very smart to be successful.
That is why his company invests so much in educating investors. His principles are simple and based on mathematics. I've been doing it a couple of years now and I don't bother looking at news, annual reports or other things people consider research. I may look at a chart to consider support and resistance for a directional trade, but it's all based on time decay. You sell an option, collect a premium and all other things being equal it will decrease in price so you can buy it back and pocket the difference. Read the Unlucky Investor where they explain it all. It has a lot of math, but you don't need to read it if you're not interested. You can skip to the conclusions to get the gist of the model. It's a two day read.
I will attest that it does take education and skill. However, The rule based system they use is backed full of logical and well defined parameters that beat the house more often than not. I have been in this game 15 years thinking I could learn the Long/short trade game and be successful. 50% win rate coupled with money management is more stressful and lends to money management mistakes that can rekt you. WIth the Sells premium you can market to market your worth everything day and adjust your risk profile like a Insurance company.
Great interview
what a great & down to earth man
27:27 1. trading small trades frequently 2. roll out options at 45, and manage at 21 days
I like listening to him. His investment style is so different from someone like Buffett who trades based on simple value and keeping those investments which can continue to compound their earning over time which is utilized to come up with PV of stock prices based on future earning.. typically 10 years. Buffett is always looking at the financials and real value versus the daily trading as described here which seems to be nearly completely focused on a type of risk management of the options market. It's interesting that he says he doesn't adhere to using charts and technical indicators commonly known to be used by stock day traders.
Buffets has been known for decades to use Options in investing through the use of Butterfly's. This single approach helped net valuable positions in long stock as he gets pays to reach the entry target. Options can be Risk adverse or high risk. The math, the structure of option is open for any stagiest to deploy at their discretion.
Man, this guy is so comfortable with his own color. That’s something. Like the ‘mark-to-market’ mindset
For all the listener out there confused by Tom's approach I am here to testify it is the most likely outcome to win over time. I doesn't mean you have to be exclusive with it but it can buffer your losses while you hunts for big winners. It can pay consistently at higher returns than Cash or bonds payments. It is for the more active person. Sell Puts and other sells premium strategies lets you control your risk very efficiently. It changed my Trading Philosophy. I hate loosing and don't mind Win small a thousands of times. The hire commission cost still net a more consistent return.
Excellent interview. Amazing people... thank you both.
Many thanks!🙌
time decay is your friend.
"I don't know if I get paid", that's a LOL if I ever heard, signed Eddie - just love
When is the TastyTrade methodology going to be documented in a well written and comprehensive book. Why hasn't Sosnoff hired a technical writer to produce such a valuable text.
It’s “The Unlucky Investor’s Guide to Options Trading”
He did just that in verbal format.
Watching and shared
Selling premium is such a great avenue to increase your cost basis
It's decreasing cost basis
You meant to say " decrease"
VERY interesting.
My negative criticism of this guest's trading approach, based on my own experience deploying it for years, has been removed.
Congratulations 🎉
there is a reason he is known for selling companies and buffet, pabrai, munger and such are known for investments.
Just a pity they don't seem interested in building paper trading into the platform as they did with Think or Swim as the TT platform is a bit intimidating for beginners.
it cost alot for the data..idk how but i know its something like that or they just assume youll use TOS's. maybe they will later. but yeah
Life lesson when someone tells you it's not about the money it always is.
I've traded option a bit and it's been addictive. I can spend my whole day in front of the monitor and trade and "don't give a crab" about the companies and if they are providing good and services that move humanity forward.
It is a bit scary what humanity will be liked in the future. Will everyone have a price tag as the base and chances of upward rewards or downward liability. In which, they may loose their place or even their life. :)
Almost anything can be addictive. Look at food. We are surrounded by risk and danger. Options traders provide a valuable service to the markets by providing liquidity and pricing efficiency. For some people it's just a fun game and doesn't have to have any meaning beyond that and that's not necessarily a bad thing.
There's no risky or best strategy if you know what you are doing.
Relieve probably.
100 trades a day?!..How can 1 person realistically manage all that & still be profitable?
He is constantly closing them and taking high probability low profit and thus low risk trades, so its like rolling the dice but winning more than 50/50 of the time.
I think you could if you had a clear plan laid out as to what you're going to do under each circumstance and you set up a way to effectively monitor.. maybe even some automatic trading. . It seems to be second nature for him. Probably doesn't even think about it. His key is to keep the positions small.. so he probably can afford to miss a few things although he indicates it doesn't matter to him and it probably doesn't.. he see's it as a job he loves doing.
prop firms execute over 200 a day..per sinlge person. no always but not weird.
they also count fills. you may have a big position you exit 10% at a time so "one trade was 10" and that could be 10 min or an hour, (edit so 10 "trades" could be 100 fills 'actual trades on the ledger') then add in swings you held ands its always rolling.
@@BobbyAeros, it is kind of easy when the platform allowing you adding a column P/L% :) Good luck.
Warren Buffett is the worlds biggest options trader. Over 45% of his portfolio is in Apple and he knows how to leverage options to multiple his profits.
Technical analysis and market history help you predict the market and improve your odds of success with options. Not knowing the potential direction of the market and stocks is investing blind. You need to know when to buy/sell a call/put. Knowing technical analysis improve your odds of success.
The math disagrees with you Tony
The charts are terrible, no built in paper trading, and delayed quotes until you fund your account. In addition, they clear through APEX which is a shady FCM. They remind me of the now defunct MF Global.
I learned more from the interviewer than Tom, he said nothing of value.