Optionetics

As an exchange member and professional option trader, I can tell you that there is no "cookie cutter" system that anyone can teach you in a seminar that will make you rich. There is nothing that you can learn in a two day seminar that is not in the basic texts that have been mentioned here like McMillan. Any system that requires you to enter a certain number of trades to qualify for their money back guarantee exposes you to the risk of possible financial ruin if they are wrong ("Sorry, you blew out your trading account after 15 trades over 4 months, you had to do twenty five over 6 months to qualify. Not our fault that you were undercapitalized......") It would take you years to learn any lucrative occupation, and trading is certainly no exception. You will read lots about people who started trading, were naturals at it, and made a million their first year. There are a (VERY) few of those people. Tiger Woods and Michael Jordon were pretty sucessful early on too, but they are not typical either. Trading for a living is the hardest work I have ever done, and you will not "get rich quick" no matter what you do. You are not going to retire early by working at it for a couple of hours in the evenings and weekends. That is simply reality for any business. Of the literally hundreds of professional traders I know and work with, I do not know a single one who blindly uses someone else's system to trade. Do your own work, and you will learn the things you have to know. The good news is that it is a very cheap business to start, and in a few years, if you work hard, are very disciplined, and study incessantly, you can begin to make a pretty good living at it. Go slow, give yourself time, and study hard. And good luck!
Jessie
 
Great post jessie. There are few secrets in the options business. Successful systems can be developed for options trading but they typically use characteristics of the underlying, not the options themselves.
 
Thanks Jessie, it was the point I was trying make in an earlier post, but you stated it much more clearly.

Lol, This board is some peoples worst nightmare.
 
Here's Optionetic's "guarantee." You have to do 36 ROUND TURN SPREAD trades over 6 months. Assuming the minimum of 2 legs per spread and that you trade out before expiration, that's 24 actual trades a month, 144 trades over the 6 month period.

Futhermore, EACH trade has to be documented on an Excel workseet explaining exactly what you did and why and it's P&L along with confirms and account statements. And it's still up to OPTIONETICS to decide if you get a refund.
 

Attachments

Sounds like it is at least a great reminder to be organized, to review and document all your transactions! Little on the expensive side.
 
Since you understand option trading, you must realize how hard it would be for a first time option trader to identify six round turn spreads a month.

And Optionetics never says the six trades a month have to be ROUND TURN SPREAD trades until someone tries to actually collect. That's too late.
 
I went to the course on Monday.

As I walked into the presentation hall a large screen played a video of "normal" people praising the system that had changed their lives.

Then the presenter (Vince something, I can't remember his surname) started the show. The first hour was spent praising options, cursing buy and hold, and promoting the system etc.... It took Vince over an hour to even state what a call option is! The rest of the seminar largely detailed their system which (from my failing memory) was along the lines off:

- find a stock with over 30% volatility and daily trading volume of over 300,000.
- check out the stock (e.g. fundamentals, technicals, economic news...)
- choose your strategy.

Vince consistently spoke of volatility being the thing to look for, but failed to state that volatility is factored into the price of an option.

Anyway, after wasting two hours of my life listenning to him I browsed through his manuals. There was nothing magical there, and I felt quite smug at having been paid to attend a superior course a couple of years ago.

Suffice to say, I won't be forking out £1,500 for his course - though I believe that quite a few of the other attendees probably did (they were repeatedly repeating his words as if he was some sort of preacher - I felt sickenned!).

So rather than throw money at the holy man I helped kill a tree or two by buying "Reminiscences of a Stock Operator". I'm still trying to decide on a book to complement (and not overlap) Hull. if anyone could recommend a title (I've only had authors recommended so far) I'd be very greatful.

Thanks,


Mauzj.
 
Mauzj,

I have the Hull book "Options, Futures, & Other Derivatives" and it is a pretty complete higher level book on options. There will of course be lots of overlap, but some books I have found useful are:

Theory:

"Option Volatility & Pricing", Natenburg (an MM "Bible")

"Black-Scholes and Beyond", Chriss

"Options as a Strategic Investment", McMillan (A basic but fairly complete text at almost 900 pages)

"McMillan On Options", McMillan (A bit "chatty" but I thought it interesting)

"The Options Edge", Gallacher (A very interesting and unique view of option pricing and trading)



Practical Trading:

"Buying Stocks Without Money", Eisen (This discusses a strategy of writing LEAPS puts as a way to finance longterm stock investment. FWIW I heard that Eisen, who used to be active on the old RagingBull boards, lost a lot of money by over-levering this idea during the 2000-01 crash. But it doesn't necessarily mean that it is a bad idea for the very longtermer, if safely sized)

"LEAPS", Harrison Roth (A very readable book on LEAPS strategies. There may even be some ideas you haven't thought of here)

Regards
 
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