Hello Option Traders,

Introduction

Ice is on the verge of leveling life as we know it in North Texas. As northern states watch the news and laugh uncontrollably at Texas, the threat of .5" ice or ice-rain brings the metroplex to a screeching halt. Unfortunately, this is the norm for Texas. Ice and snow is rarely seen through out the year so when the possibility is real, we take precautions. Not to say this is really a 'bad' thing in Texas, but the northern U.S. really doesn't understand. While the 'heartland,' New York, New England, Washington, Oregon, Montana, Minnesota, Wisconsin, and many others experience below freezing temperatures and shake in their socks, Texas residents experience an average 52 degree winter. That's right America, while parts of the U.S. is stuck under snow, we may have an opportunity to wear short-sleeve shirts as we enjoy the sun. So, if we really think about it, we'll take a little bit of ice to keep the warm weather as well as the rest of the U.S. in envy.

Stocks on Ice

Stocks skidding on thin ice trying to find footing along a slippery ravine are all over the stock market. There are many signs floating around that scream 'be careful.' As I scan through several stocks that may very well get trapped under ice, I see several 'fish hook' formations appearing on the Long-term charts of Wizetrade Options. The formation is not the only thing keeping me off the frozen lake, lack of volume is the main determinant.

Take a few examples:

AAPL

IBM

INTC

ORCL

Conclusion

Roads are slippery, winter is here, and even though Jack Frost may not be 'nipping' at your fingers, he's ready for some winter delight. Are you kidding, Jack Frost even has his stops in the market ready for any possibility.

Tim Truelove
National Trainer II, Wizetrade Options

I published this blog yesterday on the Wizetrade Equities blog site.  I thought I would re-post it here!!!

Kipp

With many stocks trading not only at 52 week lows, but at or near historic lows, an interesting opportunity is presenting itself in the market.  What most stock brokers won't tell you is that in addition to owning shares of a stock, you can also collect monthly income on those shares of stock.

Collecting “income” or “rent” on shares of stock as it is called is known as writing covered calls.  The easiest way I can explain this is that you are selling someone the right, but not the obligation, to purchase your shares of stock at a certain price within a certain period of time.  For this right you will collect a premium.  That premium becomes your “income” or “rent” collected on those shares of stock.  There are 2 components that go into the price of an option; time value and intrinsic value.  The longer the time until the option expires, the higher the time value.  The more “in the money” the option is, the more it will cost. 

Options can be sold for the current month, the next month or several months or years out in time.  The current month or “front month” options have the least amount of time value associated with them.  Options that are sold with a year or more of time until expiration have the most amount of time value associated with them. These are also known as LEAP options (Long-term Equity Anticipation Securities).  Equity options always expire on the 3^rd Friday of their expiration month.  If the price of the stock is lower (out of the money) than the strike price of the option that you sold by the expiration date, you get to keep the premium and your shares of stock.  All “out of the money” options expire worthless if they have not become “in the money” by their expiration date.  If the price of the stock is higher (in the money) than the strike price of the option that you sold by expiration, you keep the premium and sell your shares at the strike price.

Options can be sold “at the money”, “in the money” or “out of the money”.  If you sell someone an “at the money” option, it means that you are selling someone the right to buy your shares of stock at or near the current value of the stock (ex. stock is trading at $34.95 and you sell the $35 call option).  Selling an “in the money” option means you are selling someone the right to buy your shares of stock for less than its current value (ex. stock is trading at $37 and you sell the $35 call option; $2 in the money or $2 of intrinsic value).  Selling an “out of the money” option means you are selling someone the right to buy your shares of stock for more than its current value (ex. stock is trading at $33 and you sell the $35 call option).  Some traders buy “out of the money” options in anticipation that the stock price will appreciate in value greater than the strike price they are buying.  Options are sold at strike increments of $1.00, $2.50, $5.00 or $10.00, depending upon the price of the underlying equity.

Selling covered calls does require that you request Level 1 options trading permission with your broker.  Many investors trade options because of the leverage and the fact that options can produce higher percentage returns as compared to trading stocks. 

Now you are probably wondering why I just gave this long explanation about options?  The reason is that there are some stocks that have been beaten down in price to the point that a unique opportunity is presenting itself in the market.  What if you could buy a stock and over a period of a few years or less you could sell enough covered calls against those shares to ultimately bring your cost basis to zero?  This opportunity is happening right now. 

I must disclose that this should be considered VERY risky and speculative in nature since most of these stocks may have strong red trends.  Some of you may have heard me talk about doing this with Ford (stock symbol F).  I purchased shares of stock in F several months ago and have been selling covered calls against my shares almost every month since then.  The idea is that over the next few years I would sell covered calls each month, ultimately bringing my total cost basis to zero.  Let's say I owned 1000 shares of F for $2.50 and each month I managed to bring in $0.10 by selling the front month call option.  In 25 months I would have collected $2.50 in premiums, bringing my cost basis to zero.  At this point I could stop selling calls and just hold the stock in anticipation that one day it is trading around $15 or $20 and I then sell for a huge profit.  Or, I could continue to sell options against my shares, bringing in a little bit of income each month. 

To me this all makes total sense.  I can buy a stock and then one day I could own it for free.  The risk for me is two-fold.  The biggest risk is that F could file for bankruptcy, ultimately making my shares of stock worthless or the price drops to pennies a share and I am unable to sell call options.  That is a risk I am willing to take.  I would think that the Ford family has a lot more to lose than I do and won't let this happen.  The other risk is that I could sell an option too close to the current stock price or the stock price jumps and my shares get called away from me before I want them to. If it was looking like you were going to get your shares called away you could buy back the options you sold, but you would pay more to buy them back than what you originally sold them for.  That is the risk of selling options. 

I have been stalking a couple of stocks that I think are setting themselves up for this strategy.  They are URE and UYG.  Both of these stocks are ProShares ETF's (exchange traded funds).  UYG is an Ultra Financials ETF and URE is an Ultra Real Estate ETF.  Think of them like a mutual fund that trades like a stock.  Two years ago UYG was trading at over $70 a share.  Today it closed at $2.73 a share, its lowest level ever.  What is important to understand is that this ETF is comprised of financial related stocks.  The top 10 holdings in the fund include JPM, WFC, BAC, USB, GS, BK, TRV, V, C and AFL.  The good news is that unless every stock in this fund goes bankrupt, UYG could not go to zero.  The bad news is that many of these stocks could still go much lower, thus bringing down the price of UYG.  Based on today’s close, had I bought UYG right before the close for $2.75 and immediately turned around and sold the Feb. '09 $4 “out of the money” call option, I could have brought in $0.25/share of income.  Immediately I would have reduced my cost basis by $0.25 to $2.50.  Now, if I could do this every month for the next 10-12 months without getting my shares called out I could own UYG with a $0.00 cost basis. 

The other ProShares ETF that I have been stalking is URE.  It is an Ultra Real Estate ETF.  The top 10 holdings include SPG, PSA, NLY, VNO, EQR, HCP, BXP, PCL, AVB, and VTR.  URE closed today at $3.98 a share and it has been as low as $3.07 recently.  Today I could have bought the stock and turned around and sold the Feb. '09 $6 “out of the money” call option for $.20/share.  Obviously since URE is a $4 stock it would take a bit longer to bring my cost basis down to zero.  I feel that my biggest risk is that I sell a call and then the stock jumps up enough in price that I get my shares called away.  Had I bought the stock for $4/share, sold the $6 call option for $0.20 and got my shares called away for $6/share, I would have still earned 57% on my trade ($4.00 purchase price minus $0.20 for selling covered calls equals $3.80 cost basis; $6 sales prices divided by $3.80 cost basis equals 57% return). 

There are not many opportunities that show up like this in the market.  This strategy and the risks associated with it are not for everyone.  If you decide to trade this strategy or a similar strategy, please make sure you fully understand all of the nuances associated with writing covered calls as well as trading counter trend.  To make big rewards sometimes you have to take big risks.  Only you can decide if it is for YOU!!!

I published this blog yesterday on the Wizetrade Equities blog site.  I thought I would re-post it here!!!

Kipp

With many stocks trading not only at 52 week lows, but at or near historic lows, an interesting opportunity is presenting itself in the market.  What most stock brokers won't tell you is that in addition to owning shares of a stock, you can also collect monthly income on those shares of stock.

Collecting “income” or “rent” on shares of stock as it is called is known as writing covered calls.  The easiest way I can explain this is that you are selling someone the right, but not the obligation, to purchase your shares of stock at a certain price within a certain period of time.  For this right you will collect a premium.  That premium becomes your “income” or “rent” collected on those shares of stock.  There are 2 components that go into the price of an option; time value and intrinsic value.  The longer the time until the option expires, the higher the time value.  The more “in the money” the option is, the more it will cost. 

Options can be sold for the current month, the next month or several months or years out in time.  The current month or “front month” options have the least amount of time value associated with them.  Options that are sold with a year or more of time until expiration have the most amount of time value associated with them. These are also known as LEAP options (Long-term Equity Anticipation Securities).  Equity options always expire on the 3^rd Friday of their expiration month.  If the price of the stock is lower (out of the money) than the strike price of the option that you sold by the expiration date, you get to keep the premium and your shares of stock.  All “out of the money” options expire worthless if they have not become “in the money” by their expiration date.  If the price of the stock is higher (in the money) than the strike price of the option that you sold by expiration, you keep the premium and sell your shares at the strike price.

Options can be sold “at the money”, “in the money” or “out of the money”.  If you sell someone an “at the money” option, it means that you are selling someone the right to buy your shares of stock at or near the current value of the stock (ex. stock is trading at $34.95 and you sell the $35 call option).  Selling an “in the money” option means you are selling someone the right to buy your shares of stock for less than its current value (ex. stock is trading at $37 and you sell the $35 call option; $2 in the money or $2 of intrinsic value).  Selling an “out of the money” option means you are selling someone the right to buy your shares of stock for more than its current value (ex. stock is trading at $33 and you sell the $35 call option).  Some traders buy “out of the money” options in anticipation that the stock price will appreciate in value greater than the strike price they are buying.  Options are sold at strike increments of $1.00, $2.50, $5.00 or $10.00, depending upon the price of the underlying equity.

Selling covered calls does require that you request Level 1 options trading permission with your broker.  Many investors trade options because of the leverage and the fact that options can produce higher percentage returns as compared to trading stocks. 

Now you are probably wondering why I just gave this long explanation about options?  The reason is that there are some stocks that have been beaten down in price to the point that a unique opportunity is presenting itself in the market.  What if you could buy a stock and over a period of a few years or less you could sell enough covered calls against those shares to ultimately bring your cost basis to zero?  This opportunity is happening right now. 

I must disclose that this should be considered VERY risky and speculative in nature since most of these stocks may have strong red trends.  Some of you may have heard me talk about doing this with Ford (stock symbol F).  I purchased shares of stock in F several months ago and have been selling covered calls against my shares almost every month since then.  The idea is that over the next few years I would sell covered calls each month, ultimately bringing my total cost basis to zero.  Let's say I owned 1000 shares of F for $2.50 and each month I managed to bring in $0.10 by selling the front month call option.  In 25 months I would have collected $2.50 in premiums, bringing my cost basis to zero.  At this point I could stop selling calls and just hold the stock in anticipation that one day it is trading around $15 or $20 and I then sell for a huge profit.  Or, I could continue to sell options against my shares, bringing in a little bit of income each month. 

To me this all makes total sense.  I can buy a stock and then one day I could own it for free.  The risk for me is two-fold.  The biggest risk is that F could file for bankruptcy, ultimately making my shares of stock worthless or the price drops to pennies a share and I am unable to sell call options.  That is a risk I am willing to take.  I would think that the Ford family has a lot more to lose than I do and won't let this happen.  The other risk is that I could sell an option too close to the current stock price or the stock price jumps and my shares get called away from me before I want them to. If it was looking like you were going to get your shares called away you could buy back the options you sold, but you would pay more to buy them back than what you originally sold them for.  That is the risk of selling options. 

I have been stalking a couple of stocks that I think are setting themselves up for this strategy.  They are URE and UYG.  Both of these stocks are ProShares ETF's (exchange traded funds).  UYG is an Ultra Financials ETF and URE is an Ultra Real Estate ETF.  Think of them like a mutual fund that trades like a stock.  Two years ago UYG was trading at over $70 a share.  Today it closed at $2.73 a share, its lowest level ever.  What is important to understand is that this ETF is comprised of financial related stocks.  The top 10 holdings in the fund include JPM, WFC, BAC, USB, GS, BK, TRV, V, C and AFL.  The good news is that unless every stock in this fund goes bankrupt, UYG could not go to zero.  The bad news is that many of these stocks could still go much lower, thus bringing down the price of UYG.  Based on today’s close, had I bought UYG right before the close for $2.75 and immediately turned around and sold the Feb. '09 $4 “out of the money” call option, I could have brought in $0.25/share of income.  Immediately I would have reduced my cost basis by $0.25 to $2.50.  Now, if I could do this every month for the next 10-12 months without getting my shares called out I could own UYG with a $0.00 cost basis. 

The other ProShares ETF that I have been stalking is URE.  It is an Ultra Real Estate ETF.  The top 10 holdings include SPG, PSA, NLY, VNO, EQR, HCP, BXP, PCL, AVB, and VTR.  URE closed today at $3.98 a share and it has been as low as $3.07 recently.  Today I could have bought the stock and turned around and sold the Feb. '09 $6 “out of the money” call option for $.20/share.  Obviously since URE is a $4 stock it would take a bit longer to bring my cost basis down to zero.  I feel that my biggest risk is that I sell a call and then the stock jumps up enough in price that I get my shares called away.  Had I bought the stock for $4/share, sold the $6 call option for $0.20 and got my shares called away for $6/share, I would have still earned 57% on my trade ($4.00 purchase price minus $0.20 for selling covered calls equals $3.80 cost basis; $6 sales prices divided by $3.80 cost basis equals 57% return). 

There are not many opportunities that show up like this in the market.  This strategy and the risks associated with it are not for everyone.  If you decide to trade this strategy or a similar strategy, please make sure you fully understand all of the nuances associated with writing covered calls as well as trading counter trend.  To make big rewards sometimes you have to take big risks.  Only you can decide if it is for YOU!!!

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Hello Option Traders,

Introduction

[ The United States has a new leader to thwart the crippling hands of The Evil Market. It is time for the inaugurated President to climb the massive mountain of mis-managed funds and reach the capitalistic peak, sword of justice in hand, and strike down evil-doers that threaten our economy. Behind him, the flag of red, white, and blue destiny blows violently in the wind as it sways from left to right. The Paladin President stands proud on the peak of Mount Chaos with his trusty companions by his side. To his left; befriended mercenary ogre-knight, Paul's Son. Paul's Son stands ready for the battle with his partner 'Burn'-Anke peeking out behind the ogre's leg just long enough to catch a view. To the President's right, reading a book and sipping a latte, The First Mate is ready for others to handle the massive battle. If times get tough, The First Mate can always find his way back down the mountain. The final warrior in this party has proven strong and resilient. Just like every make-believe story about the unknown fate of the next Paladin President, there must be a Warlock willing to do what it takes to win. She stands behind the party ready to observe the fight and create massive damage if need-be. The wind blows strong on Mount Chaos. The dawn is approaching; the fight begins at first light. ]

What does all this have to do with options? How about the market?

The answer is simple; supply and demand. The fact I paint an imaginary picture to illustrate the swearing in of a new President, no matter how noble he can be theorized, has no bearing on what the natural cycle of the market will become. The laws of quantity supplied versus quantity demanded become the basis of all market activity. If people are not buying something, the price goes down. The market equilibrium will eventually take hold and a building economy will continue. New leadership may or may not help. We are option traders and we cannot trade in a world of dreams, hopes, aspirations, or patriotism. We trade reality in anticipation of future accomplishment or disappointment. We stand tall and don't buy the hype. We shout, “The market's in the toilet and we don't care! We're option traders!”

Bear-Side Roller Coaster Continues

The market doesn't care that a new President is sworn into office. When future becomes reality, the market will reflect the current state of our nation and other economies alike. Will the economy come back? Sure it will. Speculators will be lining up to take advantage of the opportunity just like they did since the beginning of the U.S. Option traders can trade bullish, sideways, and bearish. There's no reason we cannot sit back and let the market do whatever it wants while we reap the benefits. Bear opportunities flow like a river and smart traders are making a 'killing' and funding their retirement. Are you one of them?

AAPL
Apple Computer made a strong push to the down-side yesterday and no amount of Presidential Hype Kool-Aid could have stopped it. Like I mentioned earlier, the market does not care and therefore is 'evil.'

What we do have is opportunity. Can we make money as APPL is falling? Does the sun rise? Of course we can make money on this opportunity. If we trade the trend and accept things for how they are, we can make all kinds of money. Long Puts are the way we make directional trades in the options market. These trades are low cost (compared to short selling the stock) and create massive leverage.

Wizetrade Options allows us to watch trends in the market regardless of economic activity of hype. We see the here-and-now not 'what might happen.' Selling pressure is increasing on many stocks and indices such as AAPL and $DJI (Dow Jones Industrial Average, the most watched index in the world.) I have attached a screen shot below of market anticipation and reaction to a much hyped event.

Conclusion

The new President can claim change in any speech and sprinkle fairy dust on everything he touches, but the reality is the market is not buying it right now and is waiting until results speak for themselves. Not to say it won't happen, it will just take time and that's exactly what we are buying and selling. Options are the way to make it in this market. Learn them today.

Tim Truelove
National Trainer II, Wizetrade Options

 

Hello Option Traders,

 

Introduction

            When I first started trading options, I had the hardest time understanding the difference between ‘time value’ and ‘intrinsic value’ of an option’s premium. The concept added more difficulty on top of understanding the difference between a call and a put; in-the-money, out-of-the-money, and at-the-money options were even more confusing concepts. Since option premium is so fundamentally important to option traders, I tend to cover topics more than once. The more times I cover it, the more likely someone is going to learn and understand concepts. Today’s topic, two parts of an option that matter more than you might think.

 

Time Value

            We all should know that an option’s premium is the value of the option either paid (by the buyer) or credited (by the seller). If you find it difficult to understand this concept, please re-visit the Trader’s Path to Progress for more information. Have you ever wanted to know how those premium figures are created? It comes down to time and intrinsic value since time value plus (+) intrinsic value equal (=) option premium.

            Time value is the ‘theoretical’ value of an option contract. Basically, the idea of time value is that the option decays over time. Options have an expiration date and therefore have a sloped decay curve. Every day that passes, the option will decay by a certain calculated amount. This information is covered in the ‘Greeks’ which I will not discuss today. Think of ‘time value’ as the rental cost we pay to leverage the stock at a fraction of the current market value.

            Options can be 100% time value and range all the way to 1% time value depending on the level of ‘intrinsic value’ presented by the stock and the strike price of the option. Options with 100% time value are referred to as ‘out-of-the-money’ options. These options have no real or ‘intrinsic’ value.

            Time value is the most during an expiration month when the stock is sitting on a strike price; at-the-money. This means a $50 stock has a 50 strike for January, the time value will be the most for the 50 strike. When the stock moves away from the 50 strike, time value will begin to decrease again.

 

            As you can see in the diagram above, the long call example illustrates that as the stock approaches the at-the-money value of $50, time value is the highest for the particular expiration month. Once at 50, the strikes higher than 50 are out-of-the-money which have 100% time value (but lower value) and the options to the left are in-the-money strikes which have lower time value.

 

Intrinsic Value

            As we move into intrinsic value, understand that intrinsic value increases as the stock move past the strike price of an option in the intended direction.

 

            Example: If a long call is in play, the trader wants the stock to go higher. As the stock increases in value, it moves further away from the strike price (assuming an in-the-money options was purchased.)

 

            Intrinsic value is referred to as ‘real’ value since the strike price of the option has been exceed by a certain amount. An option becomes valuable when it has intrinsic value. An important concept to grasp about the relationship between intrinsic value and time value is they work inversely to each other. As an option gains intrinsic value, time value decreases for the expiration month. As the option loses intrinsic value, time value increases until the stock rests at the strike price (at-the-money) and if the stock continues to move away from the strike, time value will continue decreasing again.

 

       This graph illustrates the inverse relationship between time and intrinsic value. The more in-the-money an option is, the higher the intrinsic value. Intrinsic value equals zero beyond the at-the-money-mark. The next chart shows the dynamic shift if the stock continues to move higher to the next strike.

 

            Notice the shift in the time value curve moving to the higher strike. The curve remains rather consistent except that time value on the left has dropped to miniscule amounts and the 65 strike on the right now has higher time value.

 

Conclusion

            Intrinsic value continues to gain the further the stock value increases. Time value is theoretical and can be manipulated by market forces. The time value curve can shift and increase/decrease based on market demand where the intrinsic value is created by price.

            I hope this information helps in understanding the time value/intrinsic value relationship. If you have any questions, feel free to email me: ttruelove@wizetrade.com.

 

Tim Truelove

National Trainer II, Wizetrade Options

 

 

 

Hello Option Traders,

 

Introduction

            When I first started trading options, I had the hardest time understanding the difference between ‘time value’ and ‘intrinsic value’ of an option’s premium. The concept added more difficulty on top of understanding the difference between a call and a put; in-the-money, out-of-the-money, and at-the-money options were even more confusing concepts. Since option premium is so fundamentally important to option traders, I tend to cover topics more than once. The more times I cover it, the more likely someone is going to learn and understand concepts. Today’s topic, two parts of an option that matter more than you might think.

 

Time Value

            We all should know that an option’s premium is the value of the option either paid (by the buyer) or credited (by the seller). If you find it difficult to understand this concept, please re-visit the Trader’s Path to Progress for more information. Have you ever wanted to know how those premium figures are created? It comes down to time and intrinsic value since time value plus (+) intrinsic value equal (=) option premium.

            Time value is the ‘theoretical’ value of an option contract. Basically, the idea of time value is that the option decays over time. Options have an expiration date and therefore have a sloped decay curve. Every day that passes, the option will decay by a certain calculated amount. This information is covered in the ‘Greeks’ which I will not discuss today. Think of ‘time value’ as the rental cost we pay to leverage the stock at a fraction of the current market value.

            Options can be 100% time value and range all the way to 1% time value depending on the level of ‘intrinsic value’ presented by the stock and the strike price of the option. Options with 100% time value are referred to as ‘out-of-the-money’ options. These options have no real or ‘intrinsic’ value.

            Time value is the most during an expiration month when the stock is sitting on a strike price; at-the-money. This means a $50 stock has a 50 strike for January, the time value will be the most for the 50 strike. When the stock moves away from the 50 strike, time value will begin to decrease again.

 

            As you can see in the diagram above, the long call example illustrates that as the stock approaches the at-the-money value of $50, time value is the highest for the particular expiration month. Once at 50, the strikes higher than 50 are out-of-the-money which have 100% time value (but lower value) and the options to the left are in-the-money strikes which have lower time value.

 

Intrinsic Value

            As we move into intrinsic value, understand that intrinsic value increases as the stock move past the strike price of an option in the intended direction.

 

            Example: If a long call is in play, the trader wants the stock to go higher. As the stock increases in value, it moves further away from the strike price (assuming an in-the-money options was purchased.)

 

            Intrinsic value is referred to as ‘real’ value since the strike price of the option has been exceed by a certain amount. An option becomes valuable when it has intrinsic value. An important concept to grasp about the relationship between intrinsic value and time value is they work inversely to each other. As an option gains intrinsic value, time value decreases for the expiration month. As the option loses intrinsic value, time value increases until the stock rests at the strike price (at-the-money) and if the stock continues to move away from the strike, time value will continue decreasing again.

 

       This graph illustrates the inverse relationship between time and intrinsic value. The more in-the-money an option is, the higher the intrinsic value. Intrinsic value equals zero beyond the at-the-money-mark. The next chart shows the dynamic shift if the stock continues to move higher to the next strike.

 

            Notice the shift in the time value curve moving to the higher strike. The curve remains rather consistent except that time value on the left has dropped to miniscule amounts and the 65 strike on the right now has higher time value.

 

Conclusion

            Intrinsic value continues to gain the further the stock value increases. Time value is theoretical and can be manipulated by market forces. The time value curve can shift and increase/decrease based on market demand where the intrinsic value is created by price.

            I hope this information helps in understanding the time value/intrinsic value relationship. If you have any questions, feel free to email me: ttruelove@wizetrade.com.

 

Tim Truelove

National Trainer II, Wizetrade Options

 

 

 

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Hello Option Traders,

New traders are susceptible to bad habits such as missing training classes, trading with live money before paper trading, and not properly setting up their money management. Everyone knows my personal peeve is the lack of personal responsibility of devising a trade plan and proper money management, but this article will not cover those topics today. Instead, I am presenting a few notes from last night’s training class for new clients to Wizetrade.

Path to Progress

The Path to Progress was devised to assist new traders with a place to learn all about the Wizetrade software, at their leisure, without feeling singled out on Wizetrade TV. Not only that, but we have a Subscription Team specifically assigned to assist new clients find their way around and understand the application by offering personal attention and guidance. Some new to Wizetrade take advantage of these excellent resources and truly strive to learn and succeed.

The path to Progress is the first step in learn one’s way around the world of Wizetrade. There are many other resources available throughout the Community and User Groups. So, it would be safe to assume that by the time a new client shows up for the Orientation, this time held by me, they would be excited and ready to participate. Unfortunately, for them, that was not the case.

Orientation

If any of you reading this post have listened to one of my training broadcasts, you are familiar with the fact that I strive for participation. The Orientation class is a one-hour online presentation similar to the current Talk-live format. When the class started, I outlines the topics covered (Chart Analysis and In Depth Chart Reading) and mentioned that I would lecture for about 30-40 minutes and then take questions. As always, I jumped into the lesson and started off with a bang.

I advised that this class assumes the basic information from the Path to Progress is under their belt and they would be hungry to learn more in-depth information about Wizetrade program. I can sometimes get carried away with my topics, but I usually have a statement of comment from a participant that brings me back on track. Last night was a little different.

I discussed the lights and how they indicate pressure and then moved on to how the charts build. Expectations from the green and red lines as well as what goes into creating the interval were discussed. I spent 30 minutes analyzing GOOG as the example. I was sure the information I was presenting would yield a question or two. The time was 8:40pm CST and I was wrapping up the GOOG chart analysis and decided to use the information discussed and analyze two other stocks that used to be ‘high flyers’ in the market; AAPL and POT. The time was 8:50, the analysis was finished, 10 minutes was left in the class, and still, no questions. By the end of the class, I had zero feedback from the audience after multiple opportunities of getting participation. I called out to them a few times to just drop me a line and say ‘hi,’ but nothing came from it. A little perturbed, I said my ‘good night’ phrase and closed the broadcast.

Conclusion

I know I am not the ‘best’ trainer at Wizetrade, but I do try to make learning exciting and interactive. I understand basic learning mentality and teaching skills as well as many advanced concepts to keep learning interesting. I do not take this class personally, but I feel that those new clients who did not participate will have a hard time making the software work for them. Questions yield more questions and if something is not understood nor needs clarification, the instructor needs to know.

If you have an opportunity to pick a trader’s brain and you are serious about trading, take the opportunity. Have a great weekend and I’ll write to ya’ll next week.

Tim Truelove

National Trainer II, Wizetrade Options

 

 

 

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Hello Option Traders,

New traders are susceptible to bad habits such as missing training classes, trading with live money before paper trading, and not properly setting up their money management. Everyone knows my personal peeve is the lack of personal responsibility of devising a trade plan and proper money management, but this article will not cover those topics today. Instead, I am presenting a few notes from last night’s training class for new clients to Wizetrade.

Path to Progress

The Path to Progress was devised to assist new traders with a place to learn all about the Wizetrade software, at their leisure, without feeling singled out on Wizetrade TV. Not only that, but we have a Subscription Team specifically assigned to assist new clients find their way around and understand the application by offering personal attention and guidance. Some new to Wizetrade take advantage of these excellent resources and truly strive to learn and succeed.

The path to Progress is the first step in learn one’s way around the world of Wizetrade. There are many other resources available throughout the Community and User Groups. So, it would be safe to assume that by the time a new client shows up for the Orientation, this time held by me, they would be excited and ready to participate. Unfortunately, for them, that was not the case.

Orientation

If any of you reading this post have listened to one of my training broadcasts, you are familiar with the fact that I strive for participation. The Orientation class is a one-hour online presentation similar to the current Talk-live format. When the class started, I outlines the topics covered (Chart Analysis and In Depth Chart Reading) and mentioned that I would lecture for about 30-40 minutes and then take questions. As always, I jumped into the lesson and started off with a bang.

I advised that this class assumes the basic information from the Path to Progress is under their belt and they would be hungry to learn more in-depth information about Wizetrade program. I can sometimes get carried away with my topics, but I usually have a statement of comment from a participant that brings me back on track. Last night was a little different.

I discussed the lights and how they indicate pressure and then moved on to how the charts build. Expectations from the green and red lines as well as what goes into creating the interval were discussed. I spent 30 minutes analyzing GOOG as the example. I was sure the information I was presenting would yield a question or two. The time was 8:40pm CST and I was wrapping up the GOOG chart analysis and decided to use the information discussed and analyze two other stocks that used to be ‘high flyers’ in the market; AAPL and POT. The time was 8:50, the analysis was finished, 10 minutes was left in the class, and still, no questions. By the end of the class, I had zero feedback from the audience after multiple opportunities of getting participation. I called out to them a few times to just drop me a line and say ‘hi,’ but nothing came from it. A little perturbed, I said my ‘good night’ phrase and closed the broadcast.

Conclusion

I know I am not the ‘best’ trainer at Wizetrade, but I do try to make learning exciting and interactive. I understand basic learning mentality and teaching skills as well as many advanced concepts to keep learning interesting. I do not take this class personally, but I feel that those new clients who did not participate will have a hard time making the software work for them. Questions yield more questions and if something is not understood nor needs clarification, the instructor needs to know.

If you have an opportunity to pick a trader’s brain and you are serious about trading, take the opportunity. Have a great weekend and I’ll write to ya’ll next week.

Tim Truelove

National Trainer II, Wizetrade Options

 

 

Hello Option Traders,

    Vacation is now over, cold weather seems to be finally setting in, and there is plenty of work to be done. It is now time to get back into the swing of things as we kick off the new year with today's Options Blog. It's great to be back in the office doing what I love. Feel free to contact me with any questions you may have; ttruelove@wizetrade.com.
   
Markets
    According to many 'powers that be,' the United States and many other countries around the world are still in possible market collapse mode and working to restore their individual market economies. I have been away from the market for more than two (2) weeks and I can look at the Wizetrade charts and immediately understand what's going on the U.S. Stock markets. Learn the charts and you can read this information too.
    Let's start by observing the Dow Jones Industrial Average ($DJI). This analysis was done before market open so some items I mention may change slightly at 8:30 CST.
    The Long Term chart and many others are displaying all green indicators. I do not read this as a sign to buy into the market just yet as some amateurs may skeptically believe. The green lights are telling me that after a long downside trend since the beginning of last year, the markets are taking a little bit of a break. In order to understand what's happening, we must observe what's actually occurring within the charts. Open the Long Term chart.

The trend of the Long term chart is still negative. This means the direction of the overall trend is down regardless of the green fresh cross developing. Note the decrease in volatility in the last three (3) months. December is a low volume month and is almost perfect timing for the market to retrace or assume 'profit taking' actions before the new year. This cross does not suggest a 'buy' opportunity. I see this as a normal progression of the charting package and will wait to see if strength increases on this chart. In order for the strength to increase, the lower charts must remain green.
    The most important aspect to remember about reading these charts is that pressure creates strength and weakness in the charts. Pressure is generated by supply and demand factors. At this moment, there is no major demand in the U.S. Equities market and therefore the charts are currently displaying very similar formations to what was occurring on interval 18 several months previous.

Conclusion
    The market is not ready for a full-blown bull rally. Stay on guard and use this recycling time in the market to brush up and learn more about what makes the markets tick. Study up on earnings (since they ill be approaching in the next few weeks) and understand that the stock's value is directly related to whether the company meets, exceeds, or does not meet expectations by the market.
    It's great to be back doing the Options Blog. I hope everyone had a wonderful holiday season and we all need to be ready for emerging opportunities. Have a wonderful Monday.

Tim Truelove
National Trainer II, Wizetrade Options