5 AT A QUARTER…
4 AT A THIRD….
Picture yourself in the busiest open outcry pit in the world, surrounded by traders everywhere you turn.
You can barely hear yourself…as they scream and shout the bids/offers to the crowd.
As I grab an order ticket, a question is asked to me, “Do you know how much this ticket is worth?” Now, I was fighting my way out of the Eurodollar pit…and by the way, this was my first day on the CME floor!
Of course, I didn’t know… but he told me anyways…it was worth $120,000! Now, after learning the ropes and mastering the art of slithering through traders in the pit, collecting their cards as quickly as possible– without pissing off another trader or clerk, it wasn’t uncommon to see six figure trades on one trading card.
However, it was common to see traders up big…down big…or even scratch on the day. Not to mention the swings, from positive to negative…or negative to positive…the roller coaster ride that is called trading.
I collected cards for a number of traders in several different pits during my time at the CME. It’s something I look back on, and think about how lucky I was to be able to experience that. Even though, I had a daily 2 ½ hour commute into the city…plus working part-time, delivering pizza’s to pay my bills. But you know what? That rush and excitement from the trading floor still gives me chills.
As a greenhorn in the business, I wanted to learn as much as possible. However, being a runner on the floor wasn’t seen as a glamorous position.
I barely made any money– and often joked that the janitors were making more than the runners.
There was an old school mentality on the floor, you’ve got to prove and work yourself up. No one was going to give you free advice until you proved yourself. Traders came in to trade, they didn’t owe us anything. As a runner I needed to collect their tickets and do it quicker than the other guy. If I didn’t, I was out!
I kept quiet most of the time, some of these traders had so much on the line, that you didn’t want to disturb them. A distraction could end up costing them a whole lot of money.
During my time, I collected cards from various traders throughout the day, it was hard to know for sure how they were performing…but I had an idea. Some traders made more than others, some would go through a rough patch and some got burned so bad that they never returned.
There were some big traders in a few of the pits that were well financed. Of course, their profits would be bigger because they had more capital, but they also had bigger losses per trade. Some of the best traders I collected cards from, didn’t make as much money as the highly capitalized traders, but they made a very nice living.
A lot of them traded their own money–meaning they kept all their profits vs. the larger financed traders who had to share with their backers. I never looked at trying to learn from the guy with the bigger bank roll, because I’ve seen their bank rolls swing…from high to low or low to high. I just wanted to learn from those who were willing to help.
Let’s understand what goes into your profits and losses aka PnL: Capital, experience, approach, risk & luck
Risk is an essential component. I saw traders lose their job even though they made money.
Because they took on too much risk–more than what their firm allowed them to take. As you can see, firms are not solely focused on making money, they first manage their risk because they don’t want to jeopardize their operation. There are times, when I hear about traders at prop firms who have million dollar months, but the next month, they might be down $1.2 million and looking for another job. Why? Probably, because they took on too much risk according to the firm’s parameters..
From time to time, I’ll receive emails or questions from people on social media on why I don’t post my trade performance and results. It’s a great question and with so many people boasting about their trade performance and how much they make, I understand why one would ask it.
Honestly, I have several reasons why I don’t…
It’s Not About Me
In my mid 20s, I started OptionSIZZLE and managing client money. I was initially driven by my ego. I thought this was attitude needed to gain clients and customers. I thought to myself, who doesn’t want to make money, right?
I learned that no matter how well I read the market, and how good some of the trades panned out…it was never enough. You see, it didn’t necessarily translate to the success of others.
The reality is, that two people can have the same position, yet one can end up profitable while the other loses money. How so? Well, that is part of the random nature of the market. In addition, one person could have had greater conviction to stay with the position, they might have been sized more efficiently, have greater risk tolerance or a number of other viable reasons.
In any event, I get it…you want to be assured that the person you’re learning from…knows their stuff. Look, I’m the same way…I want to know that I am learning from someone that is doing it. One of my biggest pet peeves is learning from someone that isn’t doing what they’re teaching.
I’ve been involved with options as a professional, now I’m on the retail side. All together it’s been nearly a decade. Through all this time, I’ve learned that the successful investors/traders understand how tough it is to make a penny in the market. They’re humble and respect others who try to do this. They’re not interested in bragging about their results…nor do they seek social verification from others.
Some of the best investors have had scratch or even losing years…but they stick with it. They know that there will be ups and downs. There’s no guarantee or given right, that you will make money in the financial markets and they understand that.
Another thing…you might be in a different financial situation. Many people don’t realize that. The more money you have… the more you can reduce risk… and keep yourself in the game longer. So many folks on the internet are boasting about trading their six or seven figure accounts… and how good their picks are.
However, if you’re trading with a small account, like me, when I first started…you might only be able to take a small handful of the “guru” picks, because you don’t have enough capital to execute all their trade ideas. This causes you to try to guess which one of their trades are the best. This likely forces you to put too much concentration on a couple of trades. Like I talked about earlier, it’s not about the dollar amount. Every trader in that pit was in a different situation…either trading their own money or being backed.
I’m Not A Licensed Professional
Before I started OptionSIZZLE, in 2008, I was a licensed professional for 5 years. Now, let me provide you with some insight on why funds provide performance data. Since they are in the business of pursuing new clients, their performance numbers must be accurate. They are registered investment advisors and they have to adhere to very strict reporting, accounting obligations and procedures.
This is very costly, but they do it because they are marketing, in efforts to capture your money. I’m not interested in running your money…my interest is showing you and others how to do it themselves. Now, there’s a gray area on this and it becomes a very serious matter when a non-regulated person provides financial advice or recommendations to the general public.
If you’re showing your PnL or your past trades performance, as advertising, to attract subscribers you’ve got to be very compliant, which costs a lot of money. That’s why most mentors and services that showcase performance, do this through a “simulated account.”
Here’s the gray area, even if it’s simulated, from what I have learned and been advised on, if you’re still promoting without the proper documentation and licensing…you could be walking into a big storm.
With that said, I’ve worked in a registered capacity in the past…I know there is a lot of regulatory restrictions in this business. Of course, I take my work just as seriously now as I did when I was registered.
If I was still registered, the articles, videos & courses I create to help you and others wouldn’t be allowed. You see, they would have to be sent to a compliance department for approval…most likely, the material would look nothing like it does now. There wouldn’t be an OptionSIZZLE, this is why I left the industry.
It’s not a good investment of time
Keeping accurate data of all my trades for reporting and accounting takes a lot of time. The audit and verification process costs a lot of money and headaches. And quite frankly, It’s not worth my time to do that. If I was trying to gather assets, then I would need to do that.
However, I’m not in the business of trying to manage your money. I’m in the business of empowering you to have a fearless approach, taking control of your money and learning a skill that is priceless. There is no guarantee you’ll be successful…when you provide PnL results that are favorable…it almost implies that if you follow that trader….you will also be successful.
My message is bigger than following a few hot trades. Losing trades, non winning months or maybe year is part of the long journey to creating wealth, freedom and options!
I’m Not Interested in Litigation
I know a lot of traders who post their PnL and show their accounts. Like I explained earlier, that is a potential red flag down the road. It’s like the supplement company that shows images of before and after pics. You know, someone going from out of shape to fitness model fit. After they show these images…it’s usually followed by a disclaimer…you know, something like, results may vary amongst users.
That is an industry that is going through a lot of changes right now because of those images. The biggest companies and marketers are getting sued by the FTC. With that said, I’ve seen litigation’s from my time working for financial firms. The process is very costly and time consuming. The risk/reward isn’t favorable.
It’s kind of like insurance, you might never use it and could save a lot of money from not having it, however, what if you need it and don’t have it? How much does that end up costing you?
I’m not interested in boasting about myself and what I make. You can’t spend my money, so why would it matter? It’s a journey of ups and downs and that is the reality of the market. I’m not immune to trading losses or periods of drawdowns…no one is.
My message isn’t that you’re going to make a million dollars or get rich quick. That would be lying because I haven’t even made a million dollars yet. I don’t pretend to live a fake life of fast cars, mansions or hire models to inspire you. The truth is, that I invest a lot my time and money back into my businesses.
OptionSIZZLE is a work or labor. It didn’t initially see the growth I imagined it would have, but I keep working at it. I view it like my other investments. I don’t align myself with many in the industry because I either don’t believe them or they are doing their own thing. I admit, it’s easier to get people interested in you if you show your profits. I understand that, but the risk involved…plus the belief OptionSIZZLE was created on is not about me, it’s about you becoming a better options investor.
My message is, that by helping each other and learning about options, we can manage our own money and increase the chances of wealth, freedom and options. Much better than you would, if you gave it to a so-called “money manager” that sells you the sizzle without the steak.
Just because someone manages a lot of money or is touted as a hedge fund guru, doesn’t make them smarter or more informed than you. I’ve stated over and over again, 95% of them underperform every year!
You Need To Take Ownership
Making money in the market is tough…it can even be frustrating at times. When things go sour…we tend to blame others. Let’s assume I was running a trading service. Now, what if you and I got into the same trade, but the market moved and we got fill prices at different levels. I might get out, but you might consider staying in.
What if you receive an email after I exit and the market moved again. You might get angry and blame me. I want to avoid that.. this will help you become accountable. rather teach you how to fish for life than feed you dinner once.
Plus, I don’t want to be one of those guys who front run’s their customers…or goes on social media to pump a trade in order to get out.
Like I said, there are a lot of people out there that talk about their PnL… if that is what matters to you, I understand. Some will disagree and call me out, say that I am full of it and not transparent. I hear them…but I am very transparent and open with following the rules.
The great thing is that you can disagree with my reasons and beliefs, it’s fine.
You have the choice of not listening to me and going somewhere else to learn about options.
However, I invite you to judge my content with an open mind.
Also, let me share these two articles I found from the good ol’ government regarding newsletters, services and social media.
I’ve talked to thousands of investors over the last 6 years that have bounced back and forth with services, courses and mentors. Some, come back to OptionSIZZLE and finally start to get it. Ideally, I’d like for you to take what you learn from me…and apply it to your trading and see how it works.
I have a lot respect for my business mentor, I work with. I have never asked him to show me his bank account.
I respect him not because of the amount of money he makes, but because of his knowledge, experience and beliefs.
I do believe there is value in learning by watching and applying.
That is why after closing down my service a over a year ago, I’ve considered creating another SIZZLE community–where you can communicate with other people like yourself and generate ideas to trade… not trade ideas.
This would be designed to help engage and provide insight on creating trades with higher probability outcomes using option strategies… by following my Put Option Selling For Maximum Profits Report. I would fill you in on what I am doing or the best way I would play that type of activity, but I will not provide size, results or history. You’d be responsible for your own decisions. However, I’d provide details on how I’m managing the trade and when I’d be closing the position.
In addition, we’d have a community of investors/traders working together, navigating the market– with weekly group calls headed by me, where you’d be able to ask questions.
Before, my old service was all about my trade picking abilities. An ego contest, of look at how good I can trade or how much money you’re missing not being part of my service.
This is about helping you create wealth, freedom and options on your own. This is about you learning a skill that is invaluable… and something you can pass on to your loved ones and friends.
Now, is this something you have an interest towards or is there something more you’d like from OptionSIZZLE? Let me know below.
To your wealth, freedom & options!