5 Things I Quit To Become A Profitable Options Trader
Are you making money but having difficulty being consistent? If you’ve been navigating the complex world of options trading and finding yourself in a sea of losses, you’re not alone. I get it; I’ve been there too. I blew up my account not once but twice, trying to figure out the magic formula for success.
However, after learning some hard lessons, I’ve turned things around and consistently make $3,000 to $5,000 monthly. How did I do it? By quitting these five detrimental habits. Let’s dive into them so you can sidestep these pitfalls and start raking in profits.
Simplifying Chart Analysis
Forget about drowning in a sea of complex charts that look more like abstract art than a tool for success. The key to profitable trading is simplifying your charts. Get rid of the clutter and focus on the trend. In my journey, I discovered that overcomplicating charts with numerous indicators is a recipe for confusion. I now stick to a minimalist approach, identifying the lower and upper ranges of a stock and following the trend. It’s about keeping it simple and staying focused on where the trend is heading.
Opting for Quality Over Cheap Options
Gone are the days of chasing after the cheapest options available. Instead, I’ve learned the power of quality over quantity. Buying options around the 0.45 Delta range has been a game-changer. Why? Because these options are close to being in the money, gaining intrinsic value as the stock moves. I target specific strike prices based on where I expect the stock to trade, ensuring my options have real value when they hit the sweet spot.
Balancing Win Rates and Profitability
It’s easy to fall into the trap of chasing a sky-high win rate, thinking it’s the golden ticket to success. However, I’ve learned that a high win rate doesn’t necessarily mean more profits. By adjusting my strategy to focus on a 75% to 80% win rate, I increased the amount I collect on winning trades. This approach ensures that my losses, though more frequent, are significantly smaller, leading to overall profitability.
Breaking Free from Indicator Dependency
Let’s face it; there’s no perfect indicator that guarantees a flawless entry and exit every time. I quit obsessing over finding the Holy Grail of indicators and shifted my focus to understanding trends. Waiting for the perfect entry is a fool’s game. Instead, I concentrate on managing risk effectively. It’s not about perfection but about making informed decisions within the broader trend.
Harnessing the Power of Options Volume
One often overlooked aspect of options trading is volume. Pay attention to the number of contracts being traded and open interest. High volume and open interest ensure liquidity, making it easier for you to enter and exit trades seamlessly. Trading options with low volume can trap you in losing positions, amplifying your losses. Be smart and trade where the action is.
Becoming a profitable options trader
Becoming a profitable options trader isn’t about secrets or shortcuts but breaking free from counterproductive habits. I’ve walked the path, made the mistakes, and emerged wiser. By simplifying charts, investing in quality options, balancing win rates, avoiding indicator obsession, and understanding options volume, I transformed my trading game.
If you want to trade options profitably with a 86%+ win rate and consistently generate monthly income, then join the 10% Credit Spreads program!
Thanks for reading 🙂
Austin Bouley
CEO & Chief Strategy Office
