Don't Make These Beginner Options Mistakes
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- Опубліковано 6 вер 2024
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Past performance is not indicative of future results. Performance is not presented net of all commissions, fees, and expenses. Multi-leg option strategies incur higher transaction costs than single leg trades as they involve multiple commission charges. Examples provided are for illustrative, informational, and educational purposes only and are not intended to be reflective of results you can expect to achieve. Supporting documentation for any claims (including claims made on behalf of options programs), comparisons, statistics, or other technical data, if applicable, will be supplied upon request.
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10:08 "We have the unique ability to pick the WORST time to get big." Wow! Never has there been a truer statement lmao
Literally me. The only time I decided to trade big, I got hit by a tail risk 7% move on a freaking Friday...
Went from +67% profit on Thursday to -1200% loss on Friday, in less than 1 hrs of market open.
All on no catalyst/news as well. Lesson learned the hard way.
Nope, it's kinda bread and butter in trading. A blind monkey throwing darts to pick trades will do better than you if you're high on emotions.
Your bit about being Too big on one trade really hit home with me. I took my $7000 account to $13,000 in 30 days trading relatively small size. I took a trade in gold that I had so much conviction in and basically bet 8x the normal size. It went the exact opposite direction I needed it to go. Couldn’t get out of my position since too far out of the money and nobody would buy my long put. It finally came down 3 days into expiration and has been coming down but was out of the money today on expiration and couldn’t get out. I fucked myself so bad and now I am starting from ground zero. $13k to $2k within 8 days. I fucking hate myself.
So sorry to hear about this! Happens to the best of us - as long as we learn something from it, we can move forward and apply it to our future decision making process. Obviously not a fun situation, but could have been at a time later in life where you have more capital, etc.
In 2017 my modest IB account had about USD25K in it. Built up over time. I bought 10 calls in ABX. Then for some unknown reason bought another 45 calls (55 in total) stock dropped. I rolled out for a debit, stock dropped. Rolled out again for debit stock dropped then threw in towel, account eviscerated... left with 2K. During that time I was also long NUGT. That went to hell as well, so my takeaways are trade small and often, and diversify. Clawing way back now, but I think every trader needs to suffer, lick wounds and learn from such stupid mistakes.
my strategy: 401K- keep seperate, especially if your company might go under and you didn't stay long enough to reach 100% vestment, if you are fully vested, or company goes under resulting in 100% vestment by default--roll accounts to mid-risk accounts. Take 5% of annual and put in 100% risk accounts. take 5% and allocate to stability funds.
anyone knows why some random words are blurred out on the screen?
I believe it's the old logo blurred since they rebranded.
I totally agree with playing enough occurences to have odds on your side. If a type of play puts odds on your side, you have to play "enough times" for these statistics to play off. If there's a stats model behind it, you don't know what the next 10 pays will be, but you know about the next 1000, and you know them exactly.
For me: being afraid of placing trades.
I've figured out I should be using stop limit buy orders, as my buys are based on moving averages. On a recent show Tony interrupted and said "I just got filled" - that changed the way I thought about my fear of buying
Sosnoff, from Think or Swim! I knew you looked familiar at first but couldn't figure it out. You built a wonderful company and platform with ToS. I even met you at a trading symposium in Vegas (i think). Nice to see you still out here with the retail traders, must be a passion of yours.
Watching this now compared to a year ago is really refreshing and makes so much more sense.
I'm having that same moment right now. I wonder how much more I'll comprehend a year from now. One thing I'm struggling with is they keep talking about number of occurrences, but what if you don't have the capital? He said trading small is next, I guess it's a balancing act.
I have a very small account but I'm learning from messing up. You can learn from watching someone else but until you actually place trades, you don't fully understand how it works.
It’s harder for me to sell at profit than at a loss. I keep having that, “what if it keeps going?” deal…
Very True when Tom said " too good " I was laughing out so loud because that's me. I always lose on big position size but my normal size I always make money.
Your sports analogies are really helping understand options more then I have in a while thanks.
Agreed - going big on one trade is the single biggest cause for portfolio break down.
To reconcile; investing like buffett is best making less trades since it is based upon fundamentals, compounding, reducing taxes and transaction fees; trading requires frequent trades in order for the kelly critereon to come into effect.
This is the best episode that I ever watched, lot of good points to learn. Bravo Tasty Live.
a little confused on a video in the university saying that if you buy options and they go past the expiration date u have to pay the difference . your buying the stock cheaper but I assume you have to sell it before it expires or else u pay the actual price of the options/stock.
3:40 Occurences matter
9:55 Don't go big at the worst time
11:55 Our own inconsistency
14:00 Improper time frame (selling weeklys)
19:00 Sell when you have to
Newbie mistake == open a new position but the buy or close on the new position "steps" on the same option in another spread and closes it. Instead of two separate spread you end up with one crippled, weird spread.
Happened to me today
Question though for selling premium (covered calls and cash secured puts).....wouldn't you want to start the trade off in like two week or even three week option expiration periods because then you can roll your options to a higher expiration date when the trade goes against you, and in a smaller account you need all the room that you can get, and the more you rollover options...the longer the period gets and the smaller the return becomes. So why not start with the smaller periods (two week, three week) so that you have room to rollover and collect more premium while you adjust your position?
Wow! Yahoo mentioned @ 19:26. Shows how much the times have changed, and the type of consolidated market we are in now a days.
thanks for the info!
also, i love that your video volume is high enough to listen to when i'm in the hot tub, with the bubbles ;)
What technically counts as a trade? Adjustments on a current trade? And how many positions to have on at a single time if using 20% of portfolio? Would love some clarity around that. Thanks!
I love this guy! Great content. Great individual.
Extremely intelligent individual, I met him at a trade show in Chicago a few years ago, great guy!
I can’t believe that I did more then 4000 trade last year. This is my first year but I make myself become a full time trader. Still don’t know what I am doing yet but very lucky to make over 100% on my 300k account. Check in with tasty trader every day to learn more. Thanks you guys so much for all the information. Every day I am suck in information.
Sorry what happened to all the old videos? Why have you deleted those videos?
According to his stratergy at 17:59 one needs to sell only when then there are surplus of buyers in the market .But isn't it the fact that with the increased number of buyers chances of stock price uprisal are more .So why would a person would want to sell at that time ?
I guess the focus is on scalping profit and exchanging potential upside for reduced risk. Just take your profit rather than trying to time the market
@@sticklebacketienne I think having a profit target and taking it consistently taking is important part of winning strategy .. you can't time the market most of the time.
So what do you guys think about Tony Robbins Book 'unshakable' and "money master the game".
Do we apply all your point only for dividend stocks, or only some points apply to dividend and most point apply to any market?
Thanks!!
regarding # of occurrences I always think of flipping a coin. Even though the odds are 50/50 it rarely comes out 5 heads and 5 tails after 10 flips, but after 10,000 flips or more the probabilities work themselves out.
I was wondering if you guys can recommend a platform that you believe is the best or most useful for trading options? Thanks for your help.
+Henrik Rubin Thinkorswim is good. It's through TDA.
I've seen a lot of these retail traders use ThinkOrSwim. I think it's like 2000 to start an account, but it gives detailed charts and analysis. Just a suggestion.
James Morris Its free to start an account.
Y'all should try to not talk over each other. You both have good info to offer I would enjoy to hear from the other guy more
This is excellent content. Thank you
Are tastytrade video series available in podcast format? This are not just informative, I find the interaction between everyone really funny. Would love to listen through these during my work commutes.
Yep! You can find tastytrade on most RSS readers and listen / download from there. Also the tastytrade app allows you to listen / stream from mobile devices on the go.
Hi guys,
Big fan of your channel, I have a long question regarding options trading.
I am looking to replicate a core investment portfolio with options to reduce the capital required and lowering risk. For example, SPY, TLT, GLD USO (because of option liquidity and diversification.
Would debit/credit spreads (1 strike itm & 1 strike otm) be suitable or how would you approach this? I would like to hear everyones opinions and ideas.
Thank you.
With these ETF's, look into selling puts 1 standard deviation out of the money. Use Theta in your favor to collect premium and pay attention to Open Interest on your strikes.
Please help me understand. As far as "number of occurrences" goes, I want to trade nonstop. I am obsessed! However I understand that you are not supposed to use your whole account at once. It is a huge challenge for me to not get way overextended. How does someone make more trades (occurrences) when working with a small account? I am under $20,000 right now. But not for long😉
Yeap, with entries and exits pays off to be a contrarian, buying and selling into volatility. Do the same with limit orders and stops, don't chase rising prices and do not change a calculated exit. So many times we plan with a cold mind before seeing the market (75 % times we are right) but we end up not following our own analysis.
Re occurrences .... It's interesting , my thought was what has a higher probability of being closest to 0.5 : the probability 10 coin tosses yields 5 heads to 5 tails or 1000 coin tosses yields 500 tails to 500 heads ?
It's amazing how much gray hair Tom has given Tony over the last 9 years.
Why do we trade more occurances when IV is low majority of the time? You recommended selling premium only when IV is high.
What's with the weird blurs on many of these videos? 🤔
Why are things blurred out and some words edited out?
Why is there blurry places on the screen?
Censoring their genitals
Name change form tasty works to tasty trade I think
I use a dart board on my closet door wall. I spin around in my chair 3 times (just to get a little dizzy)....then launch the dart. Whatever that dart hits,....I trade on....put/call,...whatever
Tom, your soo right. Alot, of economist have no clue how finance really works. They have no real market experience. They rely too much on dot plots.
Thanks for sharing valuable insights
blurred areas are weird
As a retail investor we do not have the luxury to be wrong exactly that’s why directional trading for a retail investor is so frustrating. With high probability range bound trades you at least have an edge most of the time
Such a good video, going to have to repeat several times…
Duration over direction I like that
my question: I want to trade only the e-minis, nothing else, and open and close trades directly on the chart. Will Tastyworks let me do that?
Yes
9 years old, still very very good advise
This is absolute gold!!
Wait how would one with $10k trade thousands of times per year with the PDT rule?
They aren't entering and exiting the trades on the same day.
You 2 have changed in appearance so much over the last 10 years.😀
So informative ,, thanks alot
Sam Kinison is that you?
Always practice safety.
Super helpful. Thanks!
if im trading 2 day spy options (buying calls and puts only) am I better off going further itm or should I stick to my current strategy of buying atm? Is the additional premium only to avoid theta?
The less time you have until expiration, the lower the option cost will be, but the less time you have to be right and ultimately successful.
Directional is a suckers bet in my opinion and doing that close to expiration is a recipe for blowing up an account
Thank you very much...
Such good information. Thanks
Why the blurs
Looks like I have a lot to learn.
What’s up with this blurry stuff
I like this guy and his hair
Tony looks so young here! Player Player!
What is theta?
Margined account minimum 2k aka micro account. I'll make it up though.
Let's do this
A broker telling people they 'need' to trade more. What a shocker.
He's no longer a broker.
clyde reno TastyTrade platform receives a kickback from Ameritrade every time you place a trade through TastyTrade.
***** Anyone using high frequency algorithms is not going to be using Tasty Trade, so he's not speaking to those people. High frequency manual trading typically leads to big losses over time. That's a proven fact. So your case is not rested.
Hans Zarkov Hm...where did you find the statistical fact on that "high frequency manual trading typically leads to big losses over time"? I couldn't find it online.
Hans Zarkov Other thoughts aside, more trades means higher probability of hitting on a good spread. The fewer ones you make the less chance you have. It's the same in any situation. The more jobs you apply for the higher your chances are of getting one. etc. etc.
10,000 hours rule in effect
How much money did you dump into fees and losses...
I was net 55% from Jun (start option trading) through December. I had a gross gain of 65%, losses of 8% (including 2 assignments), and fees and commissions were
With your expertise, what binary option broker would you recommend be the best for beginners?
How much is a small account? 10k? 25k? 50k? 100k?
Love u guys
Extremely relevant .... seems like someone showed me a mirror!
its amazing reading some of these comments and replies.....don't give advice to someone if ,you yourself don't know wtf you're talking about.......some replies are misleading...stop it stop......listen learn and get it
I have a friend like that. We named him "animal."
Very kool
Amazing
Dripping with profit skills.
It is obvious which one of the two has the valuable knowledge to share with the audience. The constant and petty, non valuable interruptions by the guy in the shirt were so annoying. Especially when he interrupts mid sentence and the flow is lost.
smh, think I am done options trading, never lost so much so fast, selling options, not worth the risk. one of these sites talks about selling puts to make money. At least in a call option you know how much you can lose, all an analysts need to do is make one negative statement about a stock you own, and your put selling has you in trouble real fast. Months of solid trading up in smoke in options. If you are new to this be very careful the more volatile the more dangerous yoou are likely to walk away with some false confidence. 2400 dollars loss for 600 debit, no way worth it and no way worth hoping for turn around. AMD 1 week.
It's opposite. When selling a put option you know how much you will lose because the price can only drop to 0. Selling a call the price can go to "infinity" (unlimited risk) Also I would be curious to know if you were selling naked or selling verticals? And your position size? Because if you sell 1 vertical contract, your risk is pretty defined before you put on the trade, and hopefully you would be monitoring your position and would exit well before the trade starts turning against you.
All is left now is to move to High Definition Videos!
WTH is a tasty bites account?
Less than $25k. www.sec.gov/answers/patterndaytrader.htm
+Ian B
If you a new trader with a small account, your a tasty nugget to be eaten by the bigger guys. Just kidding, I have no idea. lol
2020 :)
Yeah I’ve made over 100 trades… still broke
The guy in the hat hasn’t changed in 11 years! The other guy has aged incredibly (albeit aging well)
Forget all that. Just tell me where to start...!!
Why am i always at a lost in following anything you guys trying to impart. Frustrated.
you are not the only one.
+Stephen Williams That is because Tom makes too many assumptions and approximations while making his point. He is sharp and fast so he changes all of those often and tries to improvise "on the fly" - which obviously makes the matters worse. I am from India and markets here are a bit different (lot sizes are not constant 100 shares, etc), I have no idea about baseball or for that matter betting jargon and Tom / TastyTrades have come up with some of their own ideas/concepts and hence some new jargon. This makes it extremely difficult to understand if you are going to listen to just a few episodes. You need to listen to a lot of this (and other) channel and do a lot of math that Tom skips on the fly. At times you will notice that there is error in where he lands after doing those "long jumps". Tony does a balancing act by anchoring Tom or by filling in the blanks with small questions or quips in between Tom's hops.
Having said that this channel is perhaps the best to follow for option traders. They have also shared trading for newbies and if you are a little advanced trader then you may like to watch Dylan Ratigan's discussions with Tom. All in all, after 10 years of trading experience I still find something new after watching say 15-20 TastyTrade videos - which is not bad at all. I too find it difficult to fathom the same at first go. So don't get frustrated :-) Hope this helps, Regards,
@Tasty Trade ok
This was tough to listen too. Is there a summary of what this guy is saying?
study up
This guy looks like he'd be teaching me how to play the didgeridoo, not how to do speculative trading
The hat has to go!
Not the wearer, just the hat!
Yeah that hat just has to go! Tom is knowledgeable and all. But that hat makes me laugh.
OMG! What he has said up to the 8:00 minute mark, could have been said in one tenth the words. He's talked about basketball, casinos...come on. Not everyone with knowledge, has the skills to teach. This could easliy have been done in 8-10 minutes.
Everybody is not a good teacher. But u r a great student.
It sounds like a coffee/cocaine induced blurb from him....he really has said nothing...nothing at all.
Their intent is to entertain and teach at the same time. Hence the talk show type set-up.
traders that blow up their account are stupid. I started investing in the market 20 years ago and ammassed a pretty big account and never blew up an account.
63k turned into 52bil
K
Hei friend aprove my account
I am Portuguese but residence brasil
Thanks love your enthusiasm in verical
Lol make mo money without using any of yow money
Rule 1 for beginners is to not trade in options. If you can't perform reasonably well trading the underlying stock, you certainly won't succeed trading options.
I disagree. One is more likely to succeed at options trading than trading purely in the underlying - pure directional bets with neither edge nor any cushion for mistakes. Regards,
Are you blocking out parts that do not need to be? @tastylive