Let’s face it …
For most everyday traders, the options market is nothing more than a casino.
They play a little money at a time, buy cheap options out of the money, and hope to win big.
Most of the time, however, the market wins. The options expire worthless and the trade goes to zero.
This is the risk we take when trading options. The trade-off for massive wins quickly loses 100% of your stake.
But unfortunately, most of those who take this approach just end up doing it.
That’s why it’s a bit like gambling. It can be like rolling the dice and hoping for a big win.
I know it’s trueâ¦ Because when I first started trading, that’s exactly how I treated the options market.
For me, it was just part of the learning process. You can’t really understand the options until you’ve traded them and felt the burn yourself.
Finally, I developed several profitable strategies to guide my business approach.
And during that process, I discovered a strategy that actually turns that upside down gambling mentality …
Instead of being a trader in the markets, looking for those wild bets to place …
We can sell these bets to other traders and collect a constant flow of money.
We essentially become the casinoâ¦ not the player. And you know the saying … “the house always wins”.
And all thanks to a not-so-well-known options strategyâ¦ put selling.
How to win on virtually any trade
Selling put options to other traders allows us to become the âhomeâ of the stock market and virtually win on every trade.
With this mindset, when you look at a chain of options, you see limitless opportunities.
As I mentioned in Monday’s Unusual Options Activity, there are countless ways to use options to make money in the market. And smart money does more than just buy options in cash bets.
There are many opportunities to buy options. But, when you turn to option writing, this is when you can take your passive income to a new level.
This is when you become the home of the stock market.
When you sell options, you don’t spend money expecting big wins. You are on the other side of the trade, you get the moneyâ¦ and you win almost every trade you place.
Think of it like this …
Do you know how all options have expiration dates?
They make each transaction a countdown …
And with each tick, if your trade hasn’t gone the way you want it to, your option loses more value.
Now think what that is for an options seller …
An options seller is EXCITED for the expiration day.
When an option you sell expires worthless, you keep 100% of the money you received to sell it. The buyer, not you, is the loser.
That’s what I mean when I say this strategy is shaking up the mindset of the game.
And by selling a put, the action can go up, sideways or even down a few percent and you come away with the exact same result. You don’t need the stock to move in a specific direction or urgently.
Now there is a risk. I don’t want it to sound like we’re saving 100% of the time.
But after nearly a decade of placing these deals, I have generated a 95% success rate.
Here is the trick …
This win rate is not only because of me (although I like to think I’m doing a good job).
This is because of the strategy itself.
Instant cashâ¦ with a 95% success rate
We showed you recently that most strategies where you buy options don’t even need a 50% success rate to be profitable.
This is because a few outsized gains can easily make up for the multiple losses you would incur.
Now when you sell put options your earnings per trade will be lower. It’s like hitting singles and doubles instead of hitting home runs.
But even with lower payouts, when you can win over 95% of the opportunities you find, it doesn’t take much to crush stock returns year after year.
This is the real beauty of selling put options.
It’s a conservative strategy that allows you to beat the entire market year after year, while taking less risk than buying options or even just buying stocks.
When done the right wayâ¦ and if you follow a simple strategyâ¦ these are obvious opportunities to generate what I like to call âinstant moneyâ in the stock market.
Thatâs why itâs a bit like being the âhomeâ of stock market players.
We can choose from the thousands of options available, to spot which ones we want to sell to raise money in the market.
Now, here’s why I’m telling you all this …
Next week, we’re running a three-day challenge for raise $ 1,000 in “Instant money”.
I’ll lay the groundwork for the most consistent service in Banyan Hill, Pure income. And will show you how to collect $ 1,000 in instant cash, if you have $ 10,000 in your trading account.
The more money you have, the more you can collect. But even if you only have a few thousand, you can still earn income from these opportunities.
You don’t want to miss it. Click here for full details …
Editor, Quick profits
Card of the day:
Clear sky for this
By Mike Merson, Editor-in-Chief, True masters of options
(Click here to enlarge the image.)
This daily chart of the biotech company Abiomed (Nasdaq: ABMD) almost looks like a weekly cryptocurrency chart from last year …
After a huge run at the end of 2018, ABMD collapsed more than 70% from its peak in 2020. At the low of the pandemic, ABMD quickly backed off and had a great run, returning to around 200 %.
In 2021, the race came to a halt at the $ 355 level. The stock tested the level several times, only to weaken and see the area below $ 300 again.
Now, however, ABMD has broken through the yellow horizontal resistance at $ 355, supported by the rising pink support line. And once he retests the first yellow S / R and clears the second, it’s the blue sky in front of that stock.
On another successful test of this first line, I would get long calls with my price target at the next key resistance at $ 387.
After that, new historic highs are probably in sight. And the company’s earnings report at the end of October could be the fuel it needs to make it happen.
Editor-in-chief, True masters of options