If you are one of the thousands of people who follow my stock picks which I post on my website TradersChoice.net you have noticed that I have changed the format for which I post my picks.
What I would like to do with this article, just to clear up any confusion, is to make this change as simple and it's profitable for you as possible.
Below is a screenshot of my most recent stock picks. (These can be found on The Money Page). Here is a link: https://traderschoice.net/The-Equity-Lists.html
If you are a trader, or someone who would like to get into stock trading, allow me to let you in on a little secret-You will almost never be able to get in at the absolute best price. Moreover, often times it is simply difficult to pick a direction in which you believe a particular stock is going to move. So as a strategy to counter against taking an initial loss from opening a position, and not being sure of a particular direction, it is very wise/and profitable to open every position with a straddle.
Opening a straddle is very simple.
You simply buy both a call and a put on the same asset (stock), with the same strike price, and the same expiration month.
Once you execute the trade in this matter, you are now taking advantage of finding the true direction of the particular asset with very little risk.
Let's look at a hypothetical trade.
Let's say you were to open a straddle on company XYZ.
Now, at the opening of your position you had expected that company XYZ was going to move higher however, company XYZ turns against you and begins to move lower.
Because you opened this position with a straddle you are now sitting pretty, and can close the call side and ride the put down lower.
Now that you have established the true direction of company XYZ by opening a straddle and closing the opposite side of the trade, you can now add to that position and capitalize even further on the price action in this manner. Very nice!
Gregory Mannarino
Thanks Greg, have been following you for sometime on Utube and I agree, time to move here to Steemit.
Thanks Greg, for explaining the straddle.
If in doubt straddle out
Hi Greg, will try to use this information one time. Thank you.
meep
Greg, Thank you for explaining the spread strategy. It makes a lot of sense now.
I used to close out the "hedge" position because it was showing a profit and because I was still wedded to my original thinking/position. So, I did not follow the rule "cut your losses fast and let your profits run". In other words, I used to do the opposite.
Your tip here reinforces this sensible rule. #marketreport
Greg has been nothing but open and honest for us to make money. Long track record. Check out his free ebooks and writeups. You can learn more from following Greg on these topics than going to college.
COULDN'T AGREE MORE!!
I trust your picks, Gregory, and I'm happy with silver, from local coin shop.
There are so many strategies and it can get overwhelming especially if you're not a seasoned trader. This info on a simple straddle is a game changer. You should get his ebook. More Detail
Options Trading: A Simple, Effective Way To Hedge Your Trades. Includes A New Technical Trading System.
By Gregory Mannarino
eBook (PDF): $19.99
This brief will outline for you a simple way to “hedge” your trades using an effective, real world strategy, and introduce you to a new trading system!
Nice Post. Maybe you can give me an advice. What Trading-Platform should a beginner use? Thanks in advance. Upvoted.
Thinkorswim is a good broker for beginners especially for options. Tons of learning and great option charts. Commissions are negotiable.
Thank you very much! I will check it out now.
Helping people to make smart choices! Thank you Greg :)
Gregory is a good soul. - upvote for up vote -
Indeed, there are very few like him
I know right. Greg is the man!
Ditto
Don't forget to hold onto the other hard asset... Pocket Change...
One of the few helping the general public get some of our money back from these criminal bankers!
Nice, I have always wondered exactly what you meant by hedging your positions. Duh! I wondered why I felt like I kept getting burned.
Thanks to the how to hedge for dummies lesson, I needed it!
I always felt hedging was betting against youself and was pointless. Thanks Greg,
I have tried to think in life of working, retiring and survival. The plan A, B and C method. Silver is big in plan C.
Do you trade stocks or options?
Mainly switched to options, trying to get some added leverage.
Another good one...I am learning the true financials and economics of the world with a lot of help from your videos and blog posts...keep em coming. If you want gardening tips follow my feed. Your videos and outlooks is one of th reasons i started to garden and learn to grow food. like you say become your own central bank, i am my own central grocery store. I bought the silver to be my own bank. Thank you again
Thank You Greg
You got it!
Hey Greg your Portrait circling around steemit
https://steemit.com/drawing/@rubenalexander/as-seen-on-steemit-4
Lovely!! Isn't it?
I FREAKING LOVE IT!
Thanks for the great info!
Glad to help.
Greg I just posted a comment on your POST ABOUT ISRAEL AN BDS THE PICTURE ONLY POST NO VIDEO an I think you would love it if u have time to check it out. Thanks for the call to arms of all your subscribers Its def working. I will def do my best to do my part.Thanks to everyone who followed me in the MANERINO community we Have a big job to do helping Greg warn the world with some wisdom that can only be done together. Lets go make a difference 1 more person at a time.
Wow u could not of said it better!
I absolutely agree, we have to help out each other and steem on steem upward together. Upvote for upvote. Be well and check me out as well
I'll def keep a look out for in the future.
What a simple, yet sophisticated method of trading. I had considered doing something of this sort with inverse ETFs using leverage, but quickly realized that it is a lose lose situation on all fronts due to volatility decay. Very informative Greg!
You mean sophisticated yet simple lol.
What about gold & silver stocks like Silver Wheaton Corp (SLW) and Harmony Gold Mining Company Limited (HMY)?
That makes me feel a lot safer when i finally start trading, seems kind of obvious, but sounds like betting on red AND black in roulette......but a lot more to gain as the odds are not even.
I just posted an article with Cliff High and his comments about a gold backed cryptocurrency and Steemit would be a great platform for this. I think any way. Thanks for the update .
After opening a straddle, how much do you wait for the price to move before closing the call or the put? What if you close too early and the price movement did not go as expected?
That's when second order trading experience comes in. Most traders use near term resistance/support levels or moving averages or Bollinger bands. About this, your experience on technicals is key. Coupled with risk appetite, toughness of balls, you got to find your equilibrium.
How much time is needed to be a trader. Is it full time watching and acting or can it be done within your everyday life?
That depends how smart u are. Really. As long as it takes for u to be comfortable with your demo performance without needing to shit your pants every now and then. If u can't achieve that with your efforts u can afford, just get some physicals or stable mining shares.
Thanks. I know you are watching our backs and appreciate that.
Good question!
Exactly! Stocks move in straight line @ ive commited up, it reverses and yer stuck takin loss or waiting fer gd news
Stocks (dont) move straight line i meant
I have been following you for 7 months now...have made some very nice profits thanks to you.
Nuggets of Gold uh er......... or should I say Silver.......
Silver,silver,silver I mean silver
I have been listening to you and many others on Utube, I appreciate your insight, knowledge and helpfulness. I have now followed you to steemit, thanks for all your help Gregory.
Everything that I have learned about trading the market has come from Greg and I am confident in saying that his contributions are second to none.
I am trying my friend. I got your back!
This stock market , bond market and real estate is in the bubble of all bubbles. This old paradigm needs to go so we can bring in the Age of Aquarius without the banking system f-ing us.
People need a bank accout to wire transfer dollar into bitcoin. So it reinforces that the banks are here to stay, even those without bank accounts who want to get into bitcoin will open an account to do so. That is the bail out of the banks, they will create bonds into the billions.
Im in on caterpillar and have no idea how it keeps climbing with showing losses for over 30 months last time in checked, but hey im not complaining. I guess fantasy land will have its advantages at times.
Great explanation of the straddle. If in doubt straddle out!
Any reason why my broker wont allow straddles?
Hey Greg. I get the approach of opening a straddle then closing one side of the trade when a direction has been established. However, I don't understand why you would enter the straddle to begin with and expose yourself to time decay and a possible drop in implied volatility before a move happens which would decrease the value of the entire straddle. Why not wait for a direction to be established and then only enter one side of the trade (with a hedge of course)? I appreciated when you used to give your prediction on the direction of the stocks and more than half the time you were correct which is a great trade percentage. I mean I can pick a stock that I know will break one way or the other in a short time frame but the direction is harder to predict. Wondering if you'd consider updating your direction of your picks or give some indication of what to look for when choosing the direction?
Next - Yen seems to be good option, because is very undervalued. We may buy ProShares Ultra Yen (YCL) to have profit from stronger yen.
https://www.investing.com/etfs/proshares-ultra-yen
What reasoning for thinking Yen is undervalued? Just curios :)
Another question.
You always say to buy "in the money" .. . How much "in the money" do you recommend/buy"
I would say in my own opinion whatever it is you wouldn't mind lossing worst case. Upvote for up vote. Steem on steem upward
Thanks for the advice.
Got to shift with the markets to remain relevant and profitable. Im doing hashtag of upvote for upvote to get all in the community more steam. Hi peoples,
https://steemit.com/@gangster.inc00
The place for political, finance, crypto, music and world news. Uploads of articles and vids that I find highlighted from the top sources. Steam up, steem upward friends.
hello
That makes me feel good about trading.
Very nice Greg. Do you use calendars for those stocks stuck in a rut?
roger that
Greg,
More post like these.
Steem is certainly a great platform to getting the word out to wake up those who are still asleep.
Liking Steemit! Time to get everybody on board🤓
Thanks Greg, very useful tips!
Thank you for saying this.
This post has been ranked within the top 10 most undervalued posts in the first half of May 13. We estimate that this post is undervalued by $20.44 as compared to a scenario in which every voter had an equal say.
See the full rankings and details in The Daily Tribune: May 13 - Part I. You can also read about some of our methodology, data analysis and technical details in our initial post.
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Has anyone here tried inverse ETFs? Is this a good way to go short?
Yes, they're very reliable as long as they have good volume. Stay away from "dead" ETFs with volume below 500k daily volume or so unless you're sure it is a good ETF nonetheless. If you buy an ETF with higher gearing but low volume, you may find it harder to exit your position well, than if you buy an ETF with slightly lower gearing but higher volume.
Thanks!
Thank you for the idea of a straddle. Could this be applied to the Robinhood app? I figured I'd try buy a few (100-500)stock trades because idk how to do the taxes here in Hawaii. Anyone using the app??
Yeah, well explained! I like the straddle strategy. In theory there's little to no risk if you execute it properly.
Thank you!!
Greg, I've also done the 10% hedge that you've talked about before. Do you think this straddle is a better strategy to do rather than the holding the 10% hedge until closing out the positions?
I have followed Greg for over 3 years. Not only is he funny as sh!#, he is also smart as a whip. I have watched his option calling evolve and this is the best and easiest way to get in to options without losing your arse.
omg Greg... it's great that you share your wisdom...and i don't mean to complain... but i don't know how to open this kind of position :( do you have an explanation for a total and complete newbie?
Good job, well explained, keep up the good work. I watched all your videos the past couple of months.
Gregory, will you please explain the items on this screen shot. For options what does "buy to open, buy to close, sell to open, and sell to close" mean? What is the "A:0.45. and B:0.42"
The confusing terminology mentioned in the question deals with entering and exiting option orders. In review, there are two main ways in which you can participate in options, you can either buy an option or write an option. When you buy an option you are buying the right to either buy (call option) or sell (put option) the underlying asset at a set price before a set date. If you write an option, you are selling this right for a premium.
When you enter a trade, you are essentially opening a position, hence the orders "sell to open" and "buy to open." If you are buying an option, either a put or a call, you must enter a "buy to open" order. If you are writing an option, also referred to as selling an option, you must enter a "sell to open" order.
Now, to exit an order, you need to close your options position. If you bought an option, you need to use a "sell to close" order, which is essentially like owning a stock where you sell it back into the market to close the position. If you wrote an option, you will need to use the "buy to close" order. While it may seem odd that you would buy to close a position, by taking a long position in the option, you neutralize the rights you sold when you wrote the option with the rights gained when you buy the new options, which closes your position.
In summary, a person holding a short position (contract writer) can sell to open (enter a contract) or buy to close (close a position). A person holding a long position (contract purchaser) can buy to open (enter a position) or sell to close (close a position).
Read more: What do the phrases "sell to open", "buy to close", "buy to open", and "sell to close" mean? http://www.investopedia.com/ask/answers/04/022604.asp#ixzz4iLH0VoNg
Hey Greg, I'm new here and to your straddle strategy (which makes great sense BTW - thanks for your tips) - Just to clarify: do you buy the same number of Puts/Calls or invest the same amount in Puts to Calls?
i.e.: the cost of Puts to Calls or vv are never the same so what's the smartest solution: equal puts/calls or equal amounts invested either way?