Trading Discussions
Options Explorer => Questions about Options Explorer => Topic started by: TradingAdmin on May 30, 2015, 12:12:43 pm
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I think this is the wrong question. The right question is what makes Options Trading so different?
Look at the graph below:
(http://www.mytradingbusiness.co.za/forum/images/HEM15.jpg)
This is a daily price chart for Lean Hogs, or bacon - the stuff you eat for breakfast in the morning. You can trade in bacon. Every $1 in price (from one horizontal line to the next) is $400 profit or loss. Thus if you can predict the direction for the next price move correctly, you can make good money - of course if you get it wrong you will loose good money as well. With the price chart as it is at the moment it is a bit hard to tell which direction the price is likely to go, thus you'll be taking a bit of a chance if you enter into this market - there is no clear direction..
That is if you trade it the normal way..
Below I am going to trade this same market with OPTIONS:
(http://www.mytradingbusiness.co.za/forum/images/LHJun15.jpg)
If the price of hogs (the red line) enters between those two thick yellow lines, I'll make a profit on this trade. If at the end of the graph (two weeks from today) the red line is anywhere between those two yellow lines, I'll be making a profit of $690! On the "down" side, if I am wrong about the price and it moves outside of those two yellow lines, I'll make a loss.
How much of a loss? By the time the price reaches the two feint yellow lines, $100 - but that is a long way for the price to go and I will realise that I am wrong a long time before that and get out - with a much smaller loss!
THUS, what does trading options allow me to do?
It allows me to manage the risk in this trade. It allows me to, in the face of uncertainty, setup a trade where I take a really small risk, in return for making a very reasonable profit. I don't anymore have to get the next price movement exactly right, it can go up or down, it can go outside my bounds a long as it returns inside. I am not going to make or loose money in a matter of minutes - I have got 18 days (weekends included) over which I may carefully monitor what my trade is doing. In other words, I can set this up and continue with my life, my day-to-day making a living business, whatever it is that you do - and just carefully monitor this situation in the evening when I have time.
I basically have a trading business that I can do in parallel with my normal day-to-day business - it does not need me to sit in front of a computer screen for hours to wait for the market to do a move which I have to time perfectly in order to make something! I can relax, go on with my life while simultaneously building my trading account..
This is what TRADING OPTIONS allows me to do!
What makes Options Explorer so different is
- It provides me with a complete trading course into options - not only a beginners course - a COMPLETE beginners to advanced options trading course. It provides me with ALL the different trading strategies for ALL the different market conditions - trending markets, level markets, volatile markets, fast paced markets, slow paced markets, etc. It allows me to setup positions, play with prices or different positions, change stuff, simulate it, all to get a 'feel' for the market and for how my strategy will work, etc.
- It provides a platform to search the live market, through hundreds of thousands of different possibilities, to identify the opportunities - such as the one above, that gives me the maximum chance of success. Have a strategy you like? Ask the Options Explorer to search the market for the best possible combination of options, the perfect market where your strategy right now will stand the max chance to succeed - the Options Explorer will sieve through ALL the markets, ALL the opportunities and highlight you exactly where, right now, which market, the perfect opportunity is available for your strategy to make you some money!
This is what makes the Options Explorer different! You have a tool that will give you ALL of the assistance you need in order to build yourself a trading business that will last - a business you can slowly build up while doing your daytime job, to in the end provide you a business which may well become your primary source of income.
(What was the outcome of this trade? I don't know - this was Lean Hogs on Friday the 29th of May 2015, today is the 30th - we'll have to wait and see what happens!?)
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Was Options Explorer updated and upgraded in recent years?
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Hi BenFet, it gets updated all the time. Mayor upgrades saw us adding spreads (inter- and intra-market spreads) and options on those spreads, added a quandl download so you can view bar chart information in your analysis windows, added a trading strategy analysis tool, a different method to measure IV strength, etc.
The website lags a bit behind..