Lance here! I heard through the grapevine that a world-famous trader is going to be is spilling a secret.
I wasn't sure what to think... but the fact that I'm writing to you about it means it's a BIG DEAL!
You see, I just found out that this legend is going to be sharing the same strategy that Warren Buffett uses to generate regular income.
That's right! This strategy is so powerful that a world famous BILLIONAIRE is using it.
Imagine what a secret like that could do in your life -- potentially raking in thousands each week, so you never have to worry about life's unexpected surprises.Click to discover the life-changing power of weekly income!
I wanted to put together a list of “must-knows” for traders who want to become profitable by learning how to properly trade options.
And by following these three tips, you’ll become a much better trader…
1. 80% of Options Expire Worthless
This has been an ongoing debate for years. Hedge fund traders say that 90% of options expire worthless, then you’ll have those active traders that say it’s more like 50-60%. However, in my experience, I’d say around 80% of options expire worthless.
And you’ll often hear about these large funds – called premium sellers, that write or sell options to collect that amount of premium. They’re making nine out of every ten winners due to the high percentage of options that expire worthless.
Therefore, when you buy options – you need to be precise on where to enter and exit.
2. Buying High Delta Options
You can also increase the probability of your trades by buying a high delta option.
Delta measures the degree to which an option is exposed to shifts in the price of the underlying asset.
Let’s say that you have a 0.75 Delta and the stock goes up $1.00, the option will go up $0.75.
For instance, if you buy an Apple (AAPL) December 210 call option for $10.00 with a 0.75 Delta. Then AAPL rallies from 215 to 216 and the price of your call option will go from $10.00 to $10.75.
3. Buying Time
You’re probably wondering why 80% of options expire worthless…
Options have time decay or theta decay – meaning every day the stock doesn’t move in your direction, the price of the option decreases.
Buying options require a fast and aggressive move in the right direction – that’s how you make money with options!
And the more time you allow the option to work, the greater the probability you will have to capture that rapid and forceful move in the right direction.
Now, if you follow these steps – buying high delta call options and time, then you won’t be part of that group that has their option expire worthless. You’ll have an advantage and your account will thank you.
The Future of Wealth
P.S. If you enjoyed reading this article, then check out my video that explains the power of options and how trading options changed the lives of many of my students by clicking on the button below.