Some more thoughts on developing skills and mastery.
The Rage to Master
Some thoughts on the process of becoming a trader
Options Trade Initiation: Why Patience Pays Off
When developing traders enter into income options strategies, there is a tendency to become impatient when executing the opening trade. The trader will typically put an order in at or around the mid-price but often finds that the market is not biting on that price immediately. This can create anxiety and a feeling of impatience in the trader, arising from the belief that, since almost … Read More
Are you REALLY willing to get back on the horse?
In Friday’s options post, we talked about the tendency of options traders to become enamored of a particular strategy simply because the trader is on a brief winning streak with that specific strategy. This propensity is particularly dangerous because market neutral income options strategies typically are entered monthly. So even a mere four month winning streak—only four successful trades in a row–allows … Read More
Avoiding Pitfalls: Safeguard Your Options Trading Journey
In a speech delivered to the American Enterprise Institute in late 1996—in the middle of the formation of the dotcom bubble of the 1990s—then Federal Reserve Board Chairman Alan Greenspan coined the term “irrational exuberance” to describe an illogical optimism about the economy that was pumping up stock prices well beyond any reasonable level. History shows that he was correct, … Read More
“Going to School” on Experienced Options Traders
This blog entry is the introduction to a series of posts about common mistakes made by options traders and how to avoid them.
The 800-Pound Gorilla in the Room: Exits
Managing your exits is at least as important as where you’re getting into the market, and a quirk of human nature makes this a little bit more complicated