Realised i hasn’t blog about options trading for a long long time. Today i am going to reveal to you my strategy to trading and how you can use it to profit from the stock market consistently. Listen up,
Shorting Naked Put
Do you know what that terms mean? Shorting naked put is actually a strategy widely known by traders and its a really simple strategy.
Shorting means selling and what i do in trading is actually selling naked put options.
Why Selling Put Options Literally Increases Your Chance Of Winning by 75%?
- You win when the stock market goes up.
- You win when the stock market goes sideway.
- If case you are all wrong in your prediction, you still win when the stock market drops, but not yet reached your strike price.
- You will only lose when the stock market drops below your strike price.
Does that ratio makes your chances of profiting to 75%?
Right now, with 75% chance of winning, the winning strategy to increase your chance of profiting to 99% comes in when you have to decide what strike price you have to sell your options for in order for the stock market to not reach your strike price.
Risk Of Losing
- Your only risk of losing is greed.
- You want more profit margin and thus violate the rules.
- The stock market crash because of another 9/11 incident.
- Corrective measures were not done properly when market is going against you.
- You fear losing.
These are your risks of losing. However, with proper trading discipline, all these can easily be avoided.
What have i not covered? There seems just too much to talk about. I’ll stop now and continue with part 2 the next time round.