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Trading Strategy #1 (reinvest everything) |
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Invested into a trade |
Profit from a trade |
Total Profit | |
Initial Portfolio Value | $10,000 | ||
1st Trade: -70% | $10,000 | -$7,000 | -$7,000 |
2nd Trade: +50% | $3,000 | +$1,500 | -$5,500 |
3rd Trade: +50% | $4,500 | +$2,250 | -$3,250 |
Portfolio at the end |
$6,750 (33% loss) |
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A very aggressive
and highly risky trading strategy. The trader risks losing the entire options portfolio with one bad trade, making it very difficult to recover. |
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Not recommended for options trading |
Trading Strategy #2 (reinvest 20% of the portfolio) |
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Invested into a trade |
Profit from a trade |
Total profit | |
Initial Portfolio Value | $10,000 | ||
1st Trade: -70% | $2,000 | -$1,400 | -$1,400 |
2nd Trade: +50% | $1,720 | +$860 | -$540 |
3rd Trade: +50% | $1,892 | +$946 | +$406 |
Portfolio at the end |
$10,406 (4% profit) |
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A conservative
trading strategy. While it may also be difficult to recover from losing trades, a recovery is often much faster than in strategy #1. This strategy has some compounding effects. The risk of losing the entire options portfolio is relatively small. |
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Recommended for options trading. |
Trading Strategy #3 (invest $2,000 per trade) |
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Invested into a trade |
Profit from a trade |
Total profit | |
Initial Portfolio Value | $10,000 | ||
1st Trade: -70% | $2,000 | -$1,400 | -$1,400 |
2nd Trade: +50% | $2,000 | +$1,000 | -$400 |
3rd Trade: +50% | $2,000 | +$1,000 | +$600 |
Portfolio at the end |
$10,600 (6% profit) |
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A conservative
trading strategy. Recovering from losing trades is comparatively easy. This trading strategy has no compounding effects. If several significant losses in a row are sustained, the strategy could still result in a total loss of one's options portfolio. |
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Recommended for options trading. |
Just one winning trade
could pay for your membership for years to come!
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The Information on the Site is provided for information purposes only. The Information is not intended to be and does not constitute financial advice or any other advice. The trading of stocks, futures, commodities, index futures or any other securities has potential rewards, and it also has potential risks involved. Trading may not be suitable for all users of this Website. Past performance is not necessarily an indication of future performance. You absolutely must make your own decisions before acting on any information obtained from this Website. |
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