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How To Be a Black Belt Credit Spread Master - 148
13:51How to be a black belt spread Master? Black Belt. Hiya! Like karate, right? Black Belt, that's the best belt you can get. So how can you be a spread Master with a black belt? Let's talk about that. First thing we got to do though, is go over the disclaimer, of course, trading involves risk. It's not suitable for everybody, you can lose money, you probably will lose money. So don't risk too much. You don't want the spouse kicking out of the house. Right? Got it. Okay. So blast from the past, right? Karate Kid, the original, with Mr. Miyagi, that one rules. I love Jackie Chan. He did great. But the original Karate Kid, the original Miyagi, it was just KickAss. And I'm gonna have to tell you a little bit story here. Karate Kid. My parents actually took me to see this in the theaters. And I loved it. Right made kind of dates can tell Joe live, but I loved it. The original one is just classic story of this guy. He's a little bit nerdy, He's skinny, he moves to this new town, he doesn't have any friends. He meets a girl. And then he gets picked on by this group of dogs, you know, and they know karate. And they're beating him up over and over and over again. And then finally there's this guy, this, this this wreck loose, right? This guy who just takes him under his wing becomes like a father figure to him because he didn't have a father and teaches him how to defend himself and teaches him karate and karate used for defense. That's a very horrible, horrible accent. But, you know, that's what Mr. Miyagi teaches them. The Karate is for defense, and it's about life. And it's about meditation and being calm and peaceful and, and all these things he gives them shows him how to do respect, right? How to Give respect. And that's what karate is about. But the thugs, all they're talking about is no mercy, no mercy, right. Karate is to win and beat and pummel and, and destroy. And so we have the rest of the movie. And eventually, hopefully, you know, hopefully, you've seen the movie. If not go watch it, but I'm going to spoil it for you here. There's a karate tournament. And, of course, the Karate Kid wins in amazing fashion. Right? And then there's Karate Kid, Part Two. And so he goes to Japan, I don't I can tell the whole story. But that one was good, too. So if you haven't watched them, the originals, you gotta go back and watch them again. And then now on Netflix, they have come out with a new series called Cobra Kai. So I guess they wanted to make more money from the Karate Kid. Right. And so they brought back all the actors. And they have a whole new series, where it continues the story. It's I think it's like 30 years in the future. 30 years have gone by since the original Karate Kid movie. And you see all the actors have grown up, and they're all there except for of course, unfortunately, Mr. Miyagi - Pat Marita because he is unfortunately he has passed away. But all the other actors are there. And that was I've been watching that. And it was it was cool. And I love the I mean, the acting is really bad. To be honest, the acting in the series is pretty bad. The story is like, you know, but I love how they showed the other side of the story. Like in the Karate Kid movie, you see everything from Daniel San's perspective. He's the kid who's just moved here how hard it is for him. You know, he's got a single mom, his mom is annoying. He's trying to make friends. But he's getting beaten up all the time. You see it from his perspective. In the Cobra Kai series. It starts you off. The main character is the main thug, the one that was torturing Danielson. And it shows you from his perspective. And he's telling the story of how this kid Daniel came to his town and messed up his life. stole his girlfriend, beat him in the tournament, made his sensei hate him, all this kind of stuff. So I loved how they showed both sides of the coin, the flip. And I mean, he was it was really well done that that part was really well done. Anyway, why am I telling you all this? Because after I saw the Karate Kid, I of course, wanted to learn karate. Just like after I saw Top Gun. I wanted to be a fighter pilot. And after I saw Jaws, I didn't go swimming for years. But when I saw karate kid, I wanted to learn karate. So I told my parents, I want to learn karate, I'll put me in a glass swimming in class. So they did, bless them. Right? And so I joined a karate class. And I'm i You see they have these belts. So you want to of course you start off as a white belt, meaning you know nothing. And then you get a different color belt as you grow and you get better and better and better. And eventually you get to a black belt and then when you get a black belt, it gets even higher. From there you can get degrees of black belts. So I started off as a white belt. No On nothing, and they started with basic stuff, right? How do you throw a punch? How do you do a kick? How do you block a punch? How do you block a kick? How do you block this and that, and so you got four or five or 10, you know, basic moves, and you practice. And that's what we did. That was the whole glass, practicing, practicing, practicing, practicing, practicing, maybe you do a sparring with somebody else a little bit, and very, very slow motion. But you're practicing the same moves over and over and over and over and over and over and over again. Eventually, I got tired of the same moves, and I'm ready to move up. So I go to my sensei Sensei, as your teacher, I go to my sensei and Sensei, please show me some of the moves for the next belt because I want to practice at home, and I want to get really good so that I can I can take the test and I can go to the next belt. And he what he told me is that I already know the moves. What are you talking about Sensei, what I found out was that the moves in karate are generally the same at all the belts. The thing is that there is more complexity at the higher levels. So what he showed me is that in slow motion, he stood in front of me, and slow motion, he threw a punch, and I blocked it. And I was able to block it, because that's what I learned as a white belt, he did a little kick, and I blocked it. But then he did a little bit faster. And he put me on my butt. Right, because I didn't know how to block it, even though I should have been able to block it. And then he moved to the side a little bit. And he punched me from the side and I didn't know how to block it. And then he hit me from the back. And he didn't I don't know how to block it. And then he had, you know, he hit me with to like, combination really fast and I didn't know how to block it. Even though I knew the moves, I didn't know the combinations, and didn't have the speed to block him. So then he told me to do the same thing to him. And he used the same moves to block everything I did, it didn't matter how fast I did it, or what side I did it, he was using the exact same moves that block the basic block the basic, you know, the basic kick, and punch and all that stuff to beat me. It was just the same thing. So that was his lesson for me at the time he goes, You need to focus and work on perfecting the moves that you already know, before you go to the next level. And so he sent me back, right, and do the block, do the kick faster, faster, better, better, crisper, more productive, more provision. So in the Karate Kid movie, if you if you watched it, you remember it you know, you remember wax on wax off, wax on wax on paint the fence up and down, paint the fence up and down. Those are the moves that Mr. Miyagi was teaching Daniel son, and he made him do it over and over and over and over and over and over and over and over again, until he got so good at these basic moves, that he was good enough to go into the tournament and fight and win. You know, it was the same moves in Mr. Miyagi, he didn't have any belt. So he didn't tell Daniel San that okay, now your white belt now your green belt, not your Brembo. He didn't have any moves. He was just teaching karate, or Karate, I guess if you say if you say it properly. But it wasn't about going from belt to belt. It was just learning. It was about learning how to do the thing. Right? So now when we talk about credit spreads, we're talking about learning the trade, learning how to do it, it's about learning the thing. So if you're a basic trader, and you want to get a really, really good trader, is there extra stuff that you got to learn? No, the moves are the same. The rules are the same, the basics are the same. There's more complexity, definitely at the higher levels. It gets scarier when you're dealing with larger numbers. You know, when you're not putting 500 into a trade, but you're putting 50,000 into a tray. Yeah, you can scare the heck out of you. That's more complexity. But the work that you got to do is the same. The basics are the same, you keep doing the same thing. punch, kick, wax on, wax off, that's all the same. It's just more complexity at higher higher levels. So you got to do the work. Right. Now you take a look at Bruce Lee, the master of karate, right, the king. He's known to say that I fear not the man who has practiced 10,000 different kicks once but I fear the man who has practiced one kick 10,000 times. Because if you focus in you excel and you expert at one particular thing, you can beat anybody else that that's not proficient at it. Okay, so even correct and even Bruce Lee did the same thing. The same exercises the same you gotta master the basics. Every time I start losing money. The first thing I do is I stopped doing everything. complicated. And I go back to the basics. Just take out everything, go back to the basics. This happens in everything I do, whether it's trading, or whether it's with my family, whether it's with marketing, whatever I want to do even like chess, you know, if you're if you're a good chess player, you start doing all the gambits, right, you start doing all the moves. But there might be a time when you start losing over and over and over again, and you're like, I don't know what to do. If you don't know what to do, you go back to the basics. Right, go back to the beginning. And then you build up again, slowly, slowly, slowly. So just like in karate, just like in chess, just like anything else that you want to learn, you got to do the work. If you want to be a master, if you want to be a credit spread Master. And that's what I want you to be in this program. That's the reason for this program, you got to put in the work. And that's why we do it over and over and over and over and over. And yes, it can get methodical it can get boring. But that's how you become a master. That is how you become a credit spread black belt by doing the same move 1000 times 10,000 times being able to put on a trade in your sleep, being able to have the rules ingrained in your brain so that you can recite them. And then eventually, I want you to be so good that you can teach other people, you can teach your kids you can teach your family you can teach your friends, your co workers, you can teach them how to do this stuff. That's how good I want you to be a black belt, credit spread Master. That's the point of this program. That's where I want you to be at the end of the program. And we're going to do it by putting in the work. So if you're with me, here Yeah, we're gonna do it. We're gonna get you there. That's that's without without any doubt in my mind that I can get you there. You have to put in the work. And you already know what that means, right? So if you're ready, let's do this.
You Cannot Retire With Only A Million Dollars - 147
16:30Turns out that a million dollars is not a big deal anymore. It's not enough to be a millionaire, or is it? I don't know, we'll talk about that. So, there's a new survey that just came out. CNBC reported on it, that's how I came about it to see it, it's put out by a company called Natix Is, I don't even know how you spell it. Natix Is Investment Advisors. That's their name-- financial company, they did a survey. And they asked millionaires. And they asked us a 16,017 millionaires who already have a million dollars in assets, right. And they asked them about what they think and how they feel about the economy, their future retirement in the year 2022. Unfortunately, most of them, a lot of them said that they are not very secure in their financial footing. In fact, 35% of them. 35% of these millionaires said that it will take a miracle for them to retire securely. Now, imagine that.. you're a millionaire, everybody's told you, well, hey, the goal is to get to a million dollars, you know, so that you can live in luxury for the rest of your life. You can stop working, quit the job, sell your business, whatever, and just relax and enjoy the rest of your life. But the people that have this million dollars are saying, Hey, we got here, but it's not enough. So my goodness, why, what happened? Well, turns out that million dollars is not what it used to be anymore. So anybody that goes, Hey, I'm a millionaire. You no big deal. Sorry, but big freakin deal. It's not enough. In fact, in in the world, right now, there are over 21 million millionaires. 21 million, that doubled from 2010 to 2020. And it keeps going up, right. So it's not a big deal anymore. And then 58% of these millionaires, 58% of them said that they will have to work longer than expected. So if they were planning on retiring at age 65, like most people do, it's gonna they're gonna have to work longer. Even if you have a million dollars in assets, according to this survey. Wow. That's insane. Right? And it could be any number of this, right? So there are economic threats growing, you know, inflation is there. The public debt is huge for the government, almost every government has tons and tons of debt. And that makes things harder for us. Because taxes go up and all kinds of stuff happens. Inflation is eating away at the money that you have, right? Interest rates are at super low points, even though the interest rates have risen, right, you go to the bank, in my have a very high interest rate account savings account, I'm getting 3.5%. So that's fine is decent, but it's a lot less than inflation. And so I'm losing money with my money sitting in the bank. 2022 is just a tough year for retirement right market was down over 23%. S&P, so geez, what do you do? Well, that is the normal way of thinking, right? So let's say you save up all your money, or you give it to an investment advisor, and then they grow it for you supposedly, right? And then when you retire, you're supposed to take out 4% of that and live off that now. $1 million 4% of that turns out to $40,000 a year. Now, yeah, you do get you know, some benefits in here and there and Social Security and whatnot. But still, you want to live on $40,000 a year? No, I don't know. I mean, I live in Texas, and it's pretty cheap to live in one of the lowest cost of living, but still, yeah, 40,000. You're like poverty level here. Even here, right? You live somewhere where it's a lot more expensive. I mean, forget about it, you can't do it, you're gonna keep working. So most people out there have a very hard time, even with a million dollars to be able to retire. And it's really sad. On the other hand, if you know how to do passive trading, you don't even need a million dollars. And we have other episodes and other videos that show you how to do the math and look for the one about our retirement calculator. And you can figure out that it doesn't take a million dollars to live a really, really good life. I mean, let's say you have a million dollars, and instead of the measly 4%, that, you know, you're supposed to take out what if you could actually make 10% on that? A year? If you can, if you can take your million dollars and make 10% a year, that's $100,000 plus whatever benefits you get from the government, most people will be like, hey, yeah, that's, that's really good. I can live off that. And that's 10% a year. Right? We like to look at it and say, Hey, we want to make 2% a month, 2% every single month, that's gonna be a lot more than 10% a year, right? That's 24%. So now we're not looking at 100,000, we're looking at 240,000 for the year. And that's relatively simple to do. It's not easy, but it's simple. We can explain to you within 10 minutes, and you'll get the picture with examples would be like, Hey, you do this, right, it'll make you to present and it's very conservative, it's very saf, right? And that's on the low end, that you can actually do better. You can do other strategies that generate more. And so it's really insane, that even in this country, right now, in this year, where everything is good, like one of the richest countries in the world. Notice I say, one of if not the richest, I don't know if it is anymore. But things are changing. And it's not the way they were 10 years, 20 years, 30 years ago, 40 years ago, right? So we have to adapt, as well, we have to adapt our finances, we have to adapt the way we think about our finances, the way we think about money, we cannot be afraid of money. We have to know how it works. We have to know how to invest it. And we have to take it away from people who don't know what they're doing. Financial Planners, investors, Wealth Advisors, if the person you give your money to to invest is going to take that money and give it to somebody else, why do you need the guy in the middle? You don't. He's just taking his fees. He's getting wealthy off of you. He's paying his bills, also you and most of the financial planners and Wealth Advisors that I know, are not really wealthy in themselves. So it's like, Hey, why am I taking advice from the blind, it's the blind leading the blind. Now, if you had a financial adviser who was a multi multimillionaire, and he got that way, not by managing money, but by actually investing, then yes, he's the guy you give the money to, to, okay, that guy knows what he's doing. Right? He's the one you want managing your money, because he's done it before he knows how to do it. And he can do it again and again. But the average guy, the average financial guy off the street, these are working Joe, just like you are just like most people are. And there's nothing wrong with that he's trying to make a living. But he's not an expert. Just because he watches the news all day doesn't make him an expert. His company has experts, the company he works for, right, he probably works for a larger or he's in, he's aligned with some larger company. That gives him information. But still, he couldn't trade his way out of a bag. Now, oftentimes, I've talked about the guy that's in my office next door, he's a financial planner, he has almost $100 million under assets in management $100 million. And he charges a 1% fee, about average. So this guy, he makes close to a million dollars a year managing other people's money. Now, it did take him maybe 20, I think 20 - 30 years to get to that level. But that's a pretty nice income. Right? And he doesn't trade very well. Now, me and him, he knows I trade. He knows I teach. And so we talk about stuff. So he does stuff for his clients. And then he does stuff for himself. So he does actually trade for himself. But it doesn't trade very well. He's lost almost $500,000, just last year. And he's losing more this year. And the year just started. So you know, just because you are a financial advisor, just because you get all these reports, and you know, the words and the jargon and the lingo. And you know what earnings are and all that stuff doesn't mean that you're a good trader, doesn't mean you're a good steward of other people's money. So these guys, they take your money, they give it somebody else. And that's what he does. Right? He invested in different funds in different mutual funds and different index funds and in bond funds, and he does all that. And so people are happy with him, because they don't know any better. Right? So as long as he can do kind of close to what the market is doing, people are happy and they keep paying him. That's the business he built. That's wonderful. That's great. People need that, right? Everybody else everybody can't trade for themselves. There are people out there that need to just turn over the money to somebody else. And if you can find somebody, you can trust somebody that knows what they're doing great. But most of these financial planners did not. They're not rich, number one. And number two, they didn't get rich by investing their own money. They got rich by charging fees. And so he's okay, my friend next door, he's okay with losing 500,000. I mean, he's not happy. But he's not going to go broke, because he's making close to a million dollars in fees. So for him, you can he doesn't spend that much money, right? And so he's okay. And he works maybe three hours a day, five days a week. So for him, it's a really good life. That's how it is, right? So if you are a millionaire, right? You cannot expect to give your money to an advisor and be able to retire. Well, at least most of the people on this survey that we're talking about, feel that they cannot. And in fact, there was a number here at the bottom says here about 36% of these millionaires feel 1/3 More than 1/3 feel that they will never have enough money to retire, they will never be able to retire. So even though they did everything right throughout their life, they save save, save invest as fast million dollar millionaire, right? Moneybags, they won't be able to retire. And that's really sad. So hopefully, I can get you to start pastor trading. You know, it just starts with one trade, pick one strategy, just put one trade on, see how it works. Right, reach out to us, we can show you some videos, we can show you some examples. There's so many things that we're working on, we're bringing stuff out there, we already have a lot of stuff out there. Just try it. Just please try it, see how it works. Okay, you owe it to yourselves. And then once you learn how to do it doesn't take very long. So it's not like you have to quit your job and be trading full time. Okay, if you're trading more than half an hour a day, I mean, you're probably doing it wrong, you're doing it too much. You're taking too much time you're doing it wrong. So realistically, yes, you can make a lot more than the experts can make for you. That's number one. Number two, if you do the old way, you need to over a million dollars to retire on time with a million dollars, you'll really never retire. But with the passive trading way, with a million dollars, you can retire, you can retire today, with a lot less, because we can show you how to make more. And when you make more, everything becomes easier. But the trades themselves are very simple. So why most more people don't do this. I don't know. I couldn't tell you. I'm out there preaching and that's why I would really love it. If you would share this with other people that you know if you know anybody that is struggling with retirement struggling with their finances, right, like, Hey, I don't know what to do, I'm getting older, right? You're in your 50s or 60s, and like retirements coming, I don't know what I'm going to do, please share this with them. Let them hear it. Tell them if you've been trading for a while, share your experience and be like you know what this stuff actually works. If you know it works, if you've been able to do it, if you haven't, and stuff is not working for you, please reach out to us. And we'll point you in the right direction. Okay. And then, if you are in that category, of somebody in this survey where you are very, very wealthy, and you don't have time, then maybe reach out to us. And we can point you in the right direction of some advisors that we know that would be able to help you that are very, very good at what they do, and that they can actually help you and manage your money for you. But they are actually really, really good at trading and investing for their own money. So we know that they can handle your money, because we do in our network. And in our customer base. We do have several people who are investment advisors, wealth planners, financial planners. And so we know they know their stuff, because they've learned it from us. They learned how to do the passive trading, so they can actually help you. So if you need somebody like that reach out to us as well. We'll try to hook you up and connect you. All right. So this is my warning. This is a sad day that you have to be more than a millionaire to retire on time. Or even if you are a millionaire, you might never retire. That's that's pretty sad. So today's just some sad news for a lot of people out there. But hopefully for you. This has been an epiphany, you know, a light bulb gone off like hey, maybe I can do something about this, maybe this passive trading stuff I should look into, and I hope you do. Alright, so until next time, may trade with the odds in your favor and take care
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The Fastest Way to Get Good at Trading - 146
16:13Today we are going to be talking about and answering a question that we get asked a lot and option genius, which is what is the fastest way to get good at trading? Because, well, let's face it, everybody wants to get rich quick, right? Now, passive trading is a great way to get there consistently, and to be profitable pretty quickly. But to get really, really good at it, it does take time. So in today's video, and yes, I said video, I'm gonna explain that in a second. In today's video, we're going to be talking about four different methods that you can use to speed that up some of these would people you already know in order to use, and I'm gonna talk about a fifth method that can really turbocharge the process that most people don't. So first of all, I gotta say, Hey, why did he say video? Well, if you're listening on the podcast, I am making this also as a video, and it's going to be on the Option Genius YouTube channel. So if you like to watch videos, and you want to learn about trading options, hop on over to our YouTube channel. And please subscribe and like and post a comment or two, because it really helps and we're trying to boost up our YouTube channel. Now, if you are listening on the podcast, no worries, because I am going to be drawing on my screen on my whiteboard a little bit on the on the screen, but I will walk you through it, so don't feel like that you have to say you're missing out on anything. Okay, so let's get to work. So for this example, I want to come up with some guidelines. Because we need to codify this right? So we're going to say that our hypothetical trader, maybe it's you wants to get good at trading as fast as possible. And he's like, Oh, how do I do this? Okay, well, first of all, I tell you, step one is to pick a strategy, that's always going to be step one, right, you got to pick a strategy that works for you that you understand, and you want to get good at. Step two is find a trading plan that is really good, that actually works that's consistent that you find probably from somebody who's already doing it, and doing it well and having success with it. So you know that the plan works. And then number three, is putting in the reps is just doing the thing over and over and over again. And that's where we're gonna talk about today and how to really speed up that process. Because wanting to pretty pretty fast, right? I like this strategy. Okay. And then I got this plan. Here you go. Here's the plan. Thank you. I got it. All right, now let's implement, and let's learn how to do it. So that's the process that takes the longest. And for some people, it takes years and years and years to never master it. Some people, they get good at it really quick. I want you to be getting good at it really quick. And so we're going to be talking about how to do that today. All right. So for this example, we're going to say that a trader is looking to learn how to do credit spreads, okay? Because most people when they start, they're like, hey, you know, I like the credit spread. Makes sense. I want to do it. A lot of people tell us they want to learn credit spreads first. So let's say we're going to be talking about credit spreads in this example. Okay. And now let's say, for the credit spreads that we're going to do, we're going to be using $1,000 in each trade. Okay, so we got $1,000 per trade. And so that is the amount that it takes to do one trade, right? So then, what do we do? Well, we got to start putting in the reps. We got to start working, because they're doing the thing. Okay, so I'm going to draw some lines here. Okay. Now, we have a trader that has, let's say, $5,000. Okay. So he's got $5,000. He's got a small account, he's looking looking to do well, right. He's looking to get good at it. Now. For $5,000. If you have $1,000 per trade, how many can you do in a month? Right? How many trades can you do in a month? Well, obviously, you can only do five trades. How about in a year? Well, if you do five trades times 12, you can do 60 trades, right? And then how about in 10 years? Well, in 10 years, you got 600 trades. All right. I apologize for my writing. I'm not. I'm not used to writing with my mouth. So you have a trader with a small account, and he's doing $1,000 per trade. He's doing five trades a month, and we're only talking about monthly, okay? We're not gonna talk about weeklies here. So, in a year, he's put on 60 trades, which is a decent amount of trades, that's a lot of trades. And then in 10 years, he's got 600. So he's got 600 reps under his belt. Now, obviously, you don't want to take him 10 years to get good at something. So we're gonna have to speed that up, right? So what if you think oh, well, what if I have a lot more money? Maybe, maybe I can, I can do that. So what if trader number two has 50k in his account, you have 50,000. So yeah, 10 times as much money. Right? So now we're looking at that and we're saying, oh, okay, well, I can do 50 trades a month. No, not really. You really don't want to be doing 50 trades a month okay, that's gonna be, especially with the real money is just, you're gonna be all over the place, it's gonna be hard to find it's gonna be a full time job, if you can do that. So, realistically, now I would spreads I like to go eight to 10. More than that, I feel like I start missing out on things, I started missing the news and some events, I started not being able to follow everything. And so I'm going to limit it and say, you know, maximum we can do even with 50k is 10 trades in a month. All right, so now in a year, you got 120 trades. So that's twice as much experience twice as many reps as trader A the first guy, right? And then after 10 years, you got 1200 trades, 1200 reps under your belt. Now that's, that's a pretty good amount. But that takes, again, 10 years to get there. So what do we do? How do we even speed this process a little bit faster? Well, you can do something that a lot of people poopoo at, but it really helps. And it's called paper trading, or virtual trading. So write your paper here. Now, with paper trading, you can do a lot more trades, right? So instead of 10 trades, you don't have any limits. So maybe you do 25 trades. Now, could you do 25 trades with the 50k? Yeah, you could, but then it's with real money. And I'm assuming you're just starting, right? So I don't want you to get ahead of yourself and lose a lot of money really quickly. I'd rather get your reps when there's nothing on risk when there's nothing on the line. So we're going to do paper trading, we do 25 trades, you can even do 30 trades, maybe even 50 trades if you're really crazy. But I would say probably 25 trades. And so in a year, 25 times 12. What is that? We're looking at 300 trades, that's 300 reps in a year. That's a lot of trades, okay? And then in 10 years, you got 3000. Now, why do I have three or 10 years here? Because it does take 10 years for you to go through all the different market cycles. Okay, that's why it's really important. Because you can't just do good one year and say, Oh, hey, I'm an awesome trader. No, I'm sorry, you haven't seen everything. You know, in 10 years, you've seen probably a bull market, you've probably seen a bear market, you've seen several corrections, you've seen sideways markets. So you've seen a little bit of everything. Okay, in one year, you really haven't seen anything. It might have been a bad year, it might have been a good year might have been sideways, you know, it might have been volatile or low volatility. So you want to be able to trade in every single market environment, you're not going to get really, really good, unless you've traded for about 10 years to see all the different market hookups, right, you want to know what to do in a bull market, you want to know what to do in a bear market, sideways market correction quick up and down moves in the market, you want to know how to do that, you won't get that experience unless you've traded for 10 years, or unless you take option number four, right? So option number four, I'm going to call it back testing, B, A, C K. Now this is probably the fastest way to get really, really good. Okay? It's not real money, obviously. But you can in your mind, simulate it and you can get experience super, super, super, super quickly. So let's say, you know, over here, you're limited by time the 5k guy, he'd only do five trades a month 50k guy does 10 trades to paper trade guy in a month, you can do 25 trades, because he has to trade it and he has to wait every single day, right? You put on a trade today or you put on 10 trades today, you got to wait till tomorrow, then the day after then then after then the day after. And you gotta wait for them to finish with back testing. You don't have to wait as long. So I'll give you example, I looked at a strategy on how to trade a two week strategy. So it was a two week strategy in a specific instrument. It was the SPX. And I came up with the plan. Somebody shared it with me. I'm like, Oh, that's great. I want to go back test this. So when you back test something, and if you're going to really work it and put real money on it. I want to know how this is going to work over the last several years, not just one or two years. I'm going to go back like 10 years. Now this one because it was the way it was set up, we can only go back for six years. So I went from 2016 started there and ended at the end of 2022. So I went for six years of trading. Now this was a two week strategy. So there were 25 trades in every single year. Right? How long do you think it took me to do all those trades? It took me four hours. took me four hours. First to do 25 times six, that's 150 trades. So I got 150 reps. Now even if it was a monthly trade, that's fine, right, I would have more reps than paper or money or low money. So that I would have more reps doing that than any other way of, of trading. Because that is the name of the game, putting in the reps, right? When you are catching the ball, you just you just gotta catch the ball. When you're throwing a pitch, you know, you get good at aim by just throwing it over and over and over. And again, and you really do that in just about anything, there's no way you're gonna get good on the first try. I know my my 10 year old he gets mad when he when he's not good at something right away. But luckily, you're not 10 years old anymore. And so you understand that it takes time to build those muscles to understand what to know what to do. And that takes reps doing it over and over over experience, right? That's what you need, though, the more experienced you are, the better trader you'll be. So how do we build that experience? Back testing is the fastest way to get there. Okay, so let's say in the first month, let's say you back test only on the weekends, and you only have a couple hours. So in a couple hours, you can say hey, you know what we're going to do credit spreads, right? So I'm going to stick I'm going to pick one stock. And I'm gonna go back 10 years, and I'm gonna put a trade on every single month, I'm gonna put a trade on, and then walk it through and let it expire or take it off, then I'll do the next month, then I'll do the next one that a new month. How many trades? Can you do? Well, you 12 a year, but you could probably do five years worth in an hour. Right? So what is that 60 trades. Okay, so let's say you do that eight days out of the month only on the weekends. So 60 times eight. You'd have 480 trades 480 trades in one month, compared to 25 with paper trading compared to 10 compared to five. So you can see the reps are incredible. And then in one year, 480 times 12. Let's say you do it for the whole year, you got 5760 trades. So in one year, you've done a lot more trades almost double than you could have done in a whole 10 years with paper. That's called speed. Right? That's called being efficient, productive. So what is my answer to what is the fastest way to get good at trading? You probably think it's back testing? No, it's not. Because true back testing is still not real trading, right, you still have to learn how to get the discipline, you have to know how to handle your emotions, you have to be under control. So the fastest way to get a better trader is to do all three, to put on as many trades as you can and be comfortable with, with real money. That's number one. So we're going to do real money. Okay, number one, we are going to do paper trading, we're going to put trades on with paper, because you could put more trades on. And you're also going to be doing back testing on the weekend. So that is my prescription for you. All right, put real trades on so you understand how the market works, you understand the discipline, how you handle it, put on paper trade. So you get really good at the software, you get really good at trading different different stocks, looking for them, finding them, managing them doing the process over and over again. But then you build up your confidence with the back testing. And that's where you get 1000s and 1000s of trades. And that's what's gonna make you really, really good. So if you can do all three of these, not just one, not just two, but all three of these. That is the fastest way to get good at trading. Okay, now, it's up to you. If you want to do the time, put it and put in the effort. If you haven't do it, it'll be worth it and you'll get the results much much faster. Otherwise, it might take you some time. might take you a few years. All right. So that's it for today. I hope this helps. If you have any questions, please reach out to us. And remember to trade with the odds in your favor. Take care
Why Real Estate Investors Love Passive Trading - 145
13:39Why do real estate investors love passive trading? That's what I want to talk about today. So a couple weeks ago, I attended a friend's real estate conference in Dallas. And it's mainly for folks who like to buy large, real multifamily and commercial real estate, with a focus on how to attract investors. So they're buying these big properties or using investors to give part of the money so that they can go and do their thing. Well, while I was there, my friend, he already knows what I'm doing. I've known him for a few years, he asked me to get on the stage, and share with everybody what I do and how I trade. Because as it turns out, a lot of real estate investors love passive trading. Because I mean, it just makes sense to them. Right? Right out of the gate, like there you explain to them? Oh, yeah, that's just like real estate, right? Now, whenever you hear the word passive investing, you think real estate, passive trading is a way to trade the stock market, but in a way, that doesn't take a lot of time. So supposedly, when you're passive investing in the real estate, you put the money in, you invest, but it doesn't take a lot of time doesn't always happen. If you've ever done any kind of real estate investing, you kind of know that, right? So when it comes to real estate, there are four main benefits, right? So there's the cash flow, because hopefully, money's coming in every month from rent, right? Then there's appreciation. So hopefully, again, the property value is going up every year, little by little, sometimes it goes down. But you know, a little bit every year is normally what it technically happens. There's amortization, this is where you know, you have a loan, you have a mortgage, and every month you pay the payment, and then the amount goes down, the amount of the equity goes up, and the amount of the loan goes down. So you own a little bit more of the house every month, that happens automatically every time you send out. So there's amortization, where equity is going up. Then number four, you have depreciation. This is a temporary tax break from the government. Because normally, you sell a property, you have to pay taxes on it, but it with depreciation, you can tell the government, hey, look, the value of my property is going down. So every year you get a tax break. But then when you sell the property, then you have to pay it all back. So it does help with your taxes while you own the property. But eventually, you do have to pay it back. Now I love all of these, right? Especially since you can get all four and more from passive trading. How let's talk about it. Number one - cashflow, right, we get monthly or even weekly cash flows from weekly options from selling options. And what's better, we don't have to deal with tenants, toilets, or termites. The big three tiers of real estate, right? No tenants, no toilets, no termites, no worries about folks moving out in the middle of the night and property being vacant for months. No worries about them messing up the place and spending money to fix it. No buying insurance or property taxes, right? We don't have to pay for homeowners insurance and renter's insurance on our properties and paying property taxes every year, whether there's any making money, not all that stuff. So basically, it's a much more peaceful experience in my mind, right? Number two is appreciation. Right? Yeah, our stocks go up, right, usually a lot more than real estate. I mean, sure, they go down too. But if that happens that let us buy us cheaper, right? We get to buy the stocks cheaper when they go down. And so our cash flow continues anyway, we're still even if the stock goes down, cash flow still going, we're still selling options. But if it goes down, we can buy more. Number three amortization. Well, that was you know, equity going up, we don't recommend taking out a loan to buy our stocks. So instead, what we can do is we can start with a lot less, a lot less money, right? So you don't need 10%, 20% down actually, nowadays, if you're an investor, you need 20%, 25%, depending on your credit, and they get credit checks. So to start with passive trading, nobody checks your credit, you're gonna have bad credit doesn't matter. And you don't need 20% down, you start with a little bit, you can start with 500 bucks, 1000 bucks, 5000 10,000. Any amount, right. But if you want, you could use margin. Now margin is a loan to buy stocks. So you can borrow up to 50% of the amount you need, right? Now, if you have more money. So if you have a larger account, I think it's roughly depending on the broker, but I believe it's about 125,000 in your account. If you have that then you can apply for something called portfolio margin, which will pretty much let you buy your stock with about 20% down Just like real estate, and again, with no credit check, that's pretty cool. Then we have number four, right depreciation, well, our stocks do not depreciate. But depending on what you're trading, you can get 6040 treatment on your taxes. And that's basically 60% of your gains are going to be capital gains long term, and 40% will be short term. It's called 1256. That's the section of the tax code. So your broker or your accountant will know, it's like, it's a this is 1256 trades, they'll know it. But this is for the options we sell. Now, the stocks we own, we want to keep them for a long time. So if we sell those for more than a year, after we bought them, then we do get the long term capital gain treatment. Now, there are two more benefits to passive trading, that real estate doesn't have number one-- costs, it costs a lot more money to invest in real estate, that typical deal requires title fees, realtor fees, appraisal fees, loan fees, closing fees, and a whole bunch of taxes, right, all different types of taxes, local, county, city state, all TIF stamp taxes, they still have those, right? You have fees when you buy. And when you sell. Now, with passive trading, you don't have all those taxes, all those fees, you just pay the Commission, which in many cases can be zero, or less than $1 per option. So a lot cheaper to do, the cost involved is a lot cheaper. Number two liquidity. So to sell a single family house, it can take you months, a larger property can take years, even if you have a buyer ready to buy the house, it can still take a month or two months, right? They have to get the appraisal, the title, all that stuff, they have to get the loan, even if they have the cash, it still takes time to do the closing and the title and all that stuff. To exit an options trade or a stock position. I mean, takes literally seconds. And it is cash sitting in your account instantly. Now, I just recently closed an account with over $4,000 to transfer over to my hedge fund. Right? Took me about a minute to close all my positions. I had the money transferred to my bank within two days. So it was in from from exit to bank. My hands - two days. You can't do that in real estate. Right? Oh, and there's actually a third benefit that I forgot to passive trading. And that's how we know about the probability of profit. When you're getting into an options trade, you know, in advance, What are my chances? What are the statistics say, on all of our option trades before we make that, when investing in real estate? There's no really way to know if you're gonna make money or not. You hope so? That's why you're doing it right. But I'm pretty sure you know, many people who have lost money on real estate that thought that they were gonna make money, but they didn't, right. I mean, he was like a sure thing property, right. But he didn't, I'm one of those people. A friend of mine approached me and said, Hey, I got this house, I want to buy it, I want to fix it up and flip it and we're gonna make X dollars. And I'm like, Okay, it looks good on everything on paper look great. We ended up losing 30 grand, because it wasn't just a house and all that stuff. And you have to know what you're doing, right? And my friend at that time he This was his first property. So I made the mistake of going with a newbie guy. But we learned we both learned and we went on and then we've done more since then. That's because I have nothing against real estate, right? I own a bunch of it, I own will own more. But it's just a harder way to start. And there's nothing close to being passive. For sure. I mean, even with my friend, he was doing all the work, but I was still going out there to the property looking, trying to find stuff, you know, looking at costs. I mean, he was not passive for in any way. So if you're a real estate investor, okay, keep doing what you're doing. If it's working, you're making money, awesome, do not stop. I'm not telling you to stop. I'm telling you maybe take a look at passive trading. It's very similar to what you're already doing. And it's easy to find the time for, right? Options trading is becoming more and more and more popular. Every year that goes by more and more options are being traded. And as more and more real estate investors find out about it. They're coming over in droves. I mean, I have a friend of mine, who owns a very large internet business about real estate. He's well known in the industry. He's a big name. And he has a site where you go there you become a member and they'll tell you of all these properties that are for sale that are not on the MLS. They're not actively on the market. So he's been in real estate for a long time. He comes up to me and says oh, I want to get into options. I'm Like, what are you talking about? You're already busy. What are you doing? Why do you want to do that? He goes, Man, I got plenty of time. And another real estate friend of mine told me about this thing called Iron condors. Do you trade those? I'm like, of course, I trade those, you know what I do. And so we talked about it. And we went on and on. And he's been trading those for years. Because while you're trading in real estate, the deals don't come all the time. Right, it takes gotta look at a lot of deals, to find one that really works. So in the meantime, you could be putting on your trades doesn't take a lot more time, it takes a lot less money, it's a lot less headache. So that's it. That's why I think that real estate investing is pretty close to passive trading. I mean, there's differences, of course, like everything else. But if you are a real estate investor, you're gonna find that passive trading comes pretty naturally, you're already going to understand it pretty well. And it's got the same goal, right? You got an asset, we want to cashflow that asset, we want to keep the asset, right. The thing is, ain't nobody messing up your asset. It will go down in price to go up in price to go down and go up. That's the way it works, doesn't matter because we're keeping the asset and keeping the stock. You keep cash flowing the stock. Right? So there we go, my friends, I want you to always be trading with the odds in your favor. And if you're buying real estate, I'm sorry, but you cannot know the odds. So come on over to passive trading. And then you can also be working with the odds in your favor. Take care. Bye bye
How to Trade With Your Spouse - 144
59:19Allen Welcome passive traders to another episode. Today, I have a big announcement. And I have a first for the podcast, which is really interesting. I'm going to tell you the first before we get into the announcement. The first is that for the first time we are having a husband and wife, team, actually, we're going to find out if they're a team or not. But they're both traders. And they're both doing well. And they've been doing it for a while. So I wanted to get their opinion on how trading works in a family how trading works in a relationship, how to not get on each other's toes. So I have today, Mr. And Mrs. Matt and Margaret Ambrosi. Welcome, guys, thank you for doing this. Matt Thanks. Thanks. Thanks for having us. Allen Now, the big announcement, we probably should have done it better and differently. But Matt is now full time as an option genius coach. So we are very happy to have Matt on board. And he's already made a big difference in several people's lives. He's getting more, more happy comments, or, you know, people coming together to have a wonderful he's doing he's getting more than I am. So I think I got the right person for the job. And if you if you see Matt, or you hear the voice, and it's kind of familiar, we did do an interview with Matt back in episode 110. So 110, and that he actually gave us a story of how he got started what he was doing. And at that point, his job, his role, or his, his goal of trading was mainly to replace his current income through trading options. So I think he's, he's come a long way since then, as a trader, and just emotionally and as a person. So, guys, welcome. And Matt, thank you again, for coming on board the team, it's been really awesome to work with you and to see you take the reins, and you know, it's only made the company stronger and better, and our customers are loving it. So they're really excited. Matt I really appreciate that Alan, you know, I couldn't be more excited. I mean, I have a real passion for this. And it's a real dream to, to do a job and and really fulfill that passion. So thank you. Allen Yep, yeah, I mean, you know, one of my mentors had told me he's like, you know, in your programs, you should have a lot more interaction with the, with the students. And I'm like, I don't have time for that. He goes, well, then you need to get a coach, we need to get some other coaches on board. And I'm like, Okay, where do I find these people? They're like, don't you have students? I'm like, yeah. You know, but they're all trying to retire. Like, they'll try to quit their jobs. He goes, No, I bet you there's some that are really good at teaching. They're really love people. And they would be happy to do this on a full time basis, or even like a part time basis, and just help other people. And I was like, huh, and I thought about that about and Matt was like almost one of the first people I thought of and I'm like, Hey, let me give him a call. And I'm sure he came out of the blue for you. And you were shocked. Matt So I mean, I really enjoy, I really enjoy helping people at the core of my being. And, you know, I just love seeing the light go off in people's minds when they see a trade and they see it work out and they see that everything's a possibility, just like it was for me. So I'm really excited to be part of it. Cool. And then Margaret a this question is for you. So he comes, he comes to you and says, Hey, you know, I've been working at Costco for I don't know, what, 1415 years or something. Yeah. And he's like, he's like, I just got this other job offer. I'm gonna What do you think? Yeah. Margaret There's a whole story. There's a whole nother story. When he got that call, because I mean, we were definitely both shocked. But I think what you just said reminded me of what a good coach Matt was before he even worked at Option Genius. Because when we we started at let's say, when we got married seven years ago, we we were both on the same page about being financially free. And what what does that look like? Matt was definitely more of a researcher in terms of he would read a book, he would, he would give it to me. And so I think we were on, we've been on board on the same page, what to do. And then when we found you, and started learning your methods, we both latched on to it. So when you caught him, I think I was just excited because I knew it was something he really wanted to do. I had already seen him in a coaching role with me and his mom and his sister of trying to like the backend stuff, right? The things that are the charts, the systems, getting your platform set up. Those are things that are challenging and takes a lot of time. And so I was like, I think I was super excited. I knew he could do it. I knew it'd be great at it. And so I just thank you for giving him the opportunity because it's really been wonderful for him to do this thing that he loves anyway. I mean, he was already before he worked for you, in the mornings before he would go to work. Its full time job was studying and learning. And so, yeah, it just was really exciting. Thank you for that. I guess we had the trust, right. The trust was already there. So. Allen Okay. Yeah, now he's doing wonderful. And, you know, he's gonna be trading at the hedge fund as well when that happened. So that's going to be exciting. So a whole new level. So awesome. Cool. All right. So let's get into you guys. All right, so the trading couple and it's not just I know for Matt, you know, he's not just a trading couple. He's got the whole trading family going on there. He told me that he and his wife and his mom and his sister all get together and have trade night. What is that? Matt So it just kind of started, you know, my, my parents live in South Carolina, we're in Georgia, and my sister is up in Massachusetts. And it was a good way. They were always interested in what I was doing. And they always wanted to learn what I was doing. So it just became natural that I would say, hey, let's just have a call. And we'll talk about it. And then I showed them how to, you know, do the platform, and you know, they had all their feelings about whether they're going to do it correctly. And all the all the fears, just like I had when I started, and I was like, Okay, well, we just started going through it. And we started meeting kind of regularly on Fridays. And it was usually Friday, like, nine 930 in the morning. And we'd meet for about an hour and we talk about it. And then it just kind of progressed and was like okay, let's do this next Friday, okay, let's do the next Friday, let's do the next Friday, next Friday, and then just became we'd call it trade top Fridays. And you know, and then started being like, if we miss one, you know, let's say my sister couldn't make it. She'd be upset, like, Oh, I gotta I gotta make it or my mother missed it, she would be upset. So we, we were there every day, you know, and then Margaret would come in here and there and it just kind of evolved. So it was really a really great experience. And then it kept us really connected. I mean, in ways that I wouldn't think you know.. Margaret And you get to learn other parts of your family members and their personalities that you didn't know before. Allen Mm hmm. I can imagine. Yeah. I mean, people's personality comes out when they're like, frustrated, or when they're Yeah. Yeah. Yeah. You were saying that a little bit earlier that your mom kind of surprised you, you know, going all aggressive on you. Matt She still does. I mean, there's like, I'm just like, you know, she'll tell us like, Oh, she did something. And then she'll like, say to my sister, oh, I got out of this trade. She's like you did? What? How do you get out of that trade? You didn't tell me about it? And it's like, yeah, they're like, they go back and forth. But it's all in solid, good. You know? Margaret Yeah, once she has the parameters, then she, she'll get a little bit more risky that she said, a differentiated, she told us it's like she's at a different age where she feels like she can take a little different risk than we can. Yeah. So it makes it makes a difference. Matt That's interesting. It also goes back and forth. I mean, my sister, she put on a trade, she was getting into a new trade that we're doing. And then my mother was like, kind of hesitant about getting into it. And my sister just went ahead and did it. And then my mother's like, Oh, I'm gonna, I'm gonna, like hours later, she she's like, I'm like, what happened? She's like, Oh, I put a trade on. Like, because my sister went ahead and did it. So they kind of play off each other. So Allen that's cool. Because normally, it's the opposite. You know, it's like, the older you get, the more conservative is like, oh, no, I don't want to lose that or lose. The younger people take more risk, but over here are flipped. That's pretty cool. Yeah. Yeah. But that I love it, how you're using something to bond, you know. And it's so rare nowadays, especially everybody's spread out across the country. It's like, oh, yeah, we get together on Thanksgiving. Yeah. Okay. Great. You guys get together every week. That's I love it. That's, that's wonderful. Yeah. I think more families need to find something in common like that. And like trading? Yeah. I mean, because the way we do it, everybody can find their own little niche, you know, yeah. Everybody can be conservative or aggressive or whatever. And yeah, I love it. Cool. So, um, how did you guys get into trading? Matt Oh, well, I mean, it was always long term for me. So I was learning about long term investing through reading and then while we actually, Margaret yeah, since you were 29, he started investing. And then we went to one seminar together. And there was a man who was sitting next to us, and he said, uh, you could self manage your portfolio. And we looked at each other and we're like, never worry, That's too scary. It's too risky. We gotta leave that to the professionals. There's reason that people get paid money to do that. And he made it seem like it was no big deal at all. And I think he was he, yeah, that was a pivotal point. And then after that, We went to a couple other seminars together. And then I think the the really the one that we learned about options was three years ago. And at that one, we I had never even heard the term option. I didn't know what an option was. We went to go find out about long term investing and how to value stocks in order to know if it's a good purchase or not. And then at that seminar, we just sat back and because they showed us how to do an option, and and then after that we met found you and he because he was looking for people who did a similar strategy. And then it after we Yeah, so that's how we got into it. Matt Right. And they, they basically started this seminar off with an option. And we're like, Oh, I thought we were coming here to long term invest. And I didn't, you know, we didn't know anything, how options work. We're trying to figure out how it did right there. And then this guy's like, Oh, I just made $7,000. And you're like, show me how you're just like, whatever you just did, like you have my attention. How did you do that? And I was like, on a, I was possessed to figure it out. I mean, Margaret, she's smarter than I am. In some ways, yes, definitely. She was like, this is a funnel, like, marketing, marketing funnel and Margaret figure it all out. And thanks for just calm down. Matt It's just she sat back, I'll relax. And I was like, I'm trying to figure it out. And but we progressed. And, you know, it really opened the whole a whole new world, really. And then, you know, we met you. Margaret And it's just a progression to back up to because that's where we started trading with our family with his mom and sister. So after we learned that strategy, and we were all trading together, that's where the, the trade top Fridays came from. So that was kind of a cool thing that came from that. Allen Okay, so from the beginning, you guys were like, Okay, we're doing this together. It's not like, you know, because Margaret, you have your own company. And if anybody wants to know, she does great videography, and photos for real estate agents, and you guys are located where? Margaret Just north of Atlanta. Allen Just north of Atlanta. So if any realtors are out there. Margaret And I'm glad you mentioned that, because honestly, the reason I want to trade is because I am getting older. I've been a creative for 20 years, and the old body isn't getting any younger. So at some point, I will not be able to schlep video gear and photography gear around, and I want to have some home, what gives me the security and knowing that I can bring in my paycheck that I'm accustomed to it on my own. But we definitely talk about our strategies together. Allen Right, exactly. So, okay, so But you said like, okay, so he's working full time you have your business, but you guys still decided, hey, we're gonna go this road together, we're gonna learn together, we're gonna go the seminars together, we're gonna talk about it. And then do you guys trade in the same account together? Or is it separate? How does that work? Matt We kind of did in the beginning. And then we realized that it was best to have separate accounts, we do everything we talk about everything together. It's just I think that's really smart. Everyone's different. But I think for us, it works that we have separate accounts, because it kind of gives you the flexibility for the trading the fit your personality, and everyone's personalitie's different, you know, even though we're married, we're different personalities. So that reflects in that account, I think. Margaret And the cool part is, we both fund each other's accounts. So when there's money that we have to put into the account to get it started, we weren't going at an equal pace, if that makes sense. Matt Right. So like, for example, I would get a bonus from Costco, I'd split that bonus, put it into our account separately, she would get a bonus, she would put that money into our accounts, and then we're trading the strategies under those two accounts. Allen Okay, so do you have any joint money like a joint account? Margaret Not for not in a brokerage account? No. I mean, we're, we're each other's beneficiaries. But yeah, right. And I think part of that, too, Alan comes from me at I was not married for 36 years, and I am very customed to taking care of myself and producing my own income, and having my own money, you know, just to be quite frank about it. I want to make sure that I can take care of myself if anything ever happened to Matt, but we definitely we know what each other's logins are. We know what the money's in there. So that part's very open. It's not like they don't share the information. But I think that's a good point about having a different trading style because I am a little more aggressive than Matt is, and we learned that we didn't know that going in, but I will jump into things a little quicker than he does and he wants to be Yeah, wants to have all the information. Matt Those are things we learned about it To think that I was not as conservative as I am. But I realized that I'm a very conservative trader. I like to know everything about everything before I jump in, and sometimes that can hinder you, Margaret, she's like, let's get to it. Let's figure it out. And she jumps in. And I'm really admire that part of her. I really do. Margaret And as long as it works out, Matt she's I say she's measured, you know, she doesn't just jump into things. She's measured about it. Allen Yeah. But like, Margaret, what you said about the, you know, having, I guess, I don't know, for for a lot of women, it's a it's a fear. But it's also about a sense of security. And a lot of our customers are, you know, are the customers that come to us, and they come in, they're like, you know, my spouse doesn't want me trading, or when my spouse would rather have me working, because that paycheck comes in regular. I remember when I first started, even, even though I was, in the beginning, I was horrible. I lost a lot of my wife's money. But after I got good at it, she still was not comfortable with the trading, because she would be like, Okay, I don't know, if you're going to make money every month, you know? Because that's just the way it is. And so she's like, Can you do something pleased to have something regular come in? And that's probably the biggest motivation behind the company option genius. Was that, hey, even if I have a little bit, you know, obviously, I'm supposed to be a small little one person company. And is like, even if I have a little bit like, like a, you know, like, five $6,000 coming in a month. Okay, cool. She'll know that, you know, because she still wanted to work. So she knows something's coming in. But that's, that's just, I think it's ingrained in a lot of spouses that are not generating an income on their own that, hey, I need some consistency. So that's been a big for a lot of people. That's a big, you know, switch. Like to go from Yeah, my wife my husband makes or my wife makes x dollars per month to Yeah, I don't know, if he's gonna make any money. Margaret Yeah, I can see how that would be difficult. Because I mean, we're still both bringing in incomes and trading at the same time. Yeah. Matt Yeah, it's a big shift, a mindset shift. But I think the thing about trading is that, you know, when you're working a static job, you have that income, like you said, it's coming in monthly, you can rely on it. But the real benefit of trading, I think, is that you don't see used to see money as you exchange your paycheck for time. And in trading. You can just, you can just make money, and you don't have to sit there for that time. No, it's, you look as money is finite, in your mind, okay? When you look at trading, you work with trading, it's like, it just opens up to you. Margaret It's more of an energy like it goes out comes and goes out. Exactly. Yeah. Matt So I'm trying to say, Allen interesting. That's a good way to look at it. Yeah. So then have this written down? Okay, I'm gonna ask it or I don't know if which one of you is a better trader? Margaret So how do you define better? Allen I guess, who makes the most money? Matt I will say that I wrote this in a lot of books. And I believe that to be true as a women's are much better emotionally, as traders, I believe that I really do because guys are gonna over are like our macho, we just gotta just get in there and do it. And, you know, but in general, I think women are much, much better emotional trading style. Margaret I will just say last year, Matt made more money than I did. But this year, I've made more money than Matt did. So there you go.. Matt But I'm built for the long. Nothing short term with me. We actually nickname each other Margaret's short term, and I'm on long term, Margaret Yeah, I like short term, you know, I'm an entrepreneur. So I like to see things happen in a timely fashion. I live and breathe it, you know. And so I had do struggle with the long term stuff. One day, I would be curious to see what it would like be like to do long term put that. We'll see about that, you know, I like I like the shorter term gains. Matt But yeah, I mean, that's all part of your personality. So we I think we play off each other very well, you know? Yeah. Allen Yeah. It seems like you guys have a good balance. So then, like, if there's a disagreement, then how do you guys handle that? Or is it just, you know, you do whatever you want your account? I'll do whatever I want to my account. Margaret Yeah, well, we talk about what strike prices we're going to be at, and where, you know, kind of idea of what we both want to do. And then we may be a couple points different from each other. Matt Yeah, but we stay within the rules. And I think you know, the great thing about the strategies that you teach and that we've learned is that there's some flexibility in that, okay, as you get better as a trader, it's just not the rules, right? You know, it's just not like, Oh, get out here. And that's it, there's a little bit of flexibility, I think as you get better as a trader, you get more experienced behind you, you're able to kind of fudge the lines a little bit, if you will, not in a bad way, but be like, okay, you know, I know this, I have a little more experience, I can become a better trader. So it's like, that's the whole flexibility part. Margaret Right. And I think, too, just just thinking about how sometimes Matt will stay in a trade longer than me, and I'll get out quicker. Here's a good example. So this month, in our oil trading, I have tripled up, I've gotten in and gotten out three times, and he stayed in the whole time. You know, and I know, during the classes, there's a couple of other people in our class, when we're on the queue that do the same thing. And then some people will sit and so I think it just depends, and I don't know that it would work as well. For us, if we had one account, I just love having our separate accounts, where we get to talk about what we're gonna do and then have the freedom to.. Matt I think the key is that we talk about it. Yeah, I mean, if you don't talk about things between each other, it's just not gonna work. Yeah. So you're like, Okay, you're gonna go that at least I know about it, right. And then you can see how it works out, right. And then at least you know, what, what's going on, you know, it's different, if you just have a count, and you're just doing your own thing, and you're not talking about it. Margaret The, the emotions part is very real. And I don't think you can really understand that until you start to become a trader, and you see where the trade is. And you get to know yourself better, where in the beginning, we were a lot quicker to get out of a trade if it went a certain way. And now we've learned a little bit more of the rhythms, we know each other's rhythms. And so we don't we don't freak out either way, quite as much. Matt: But you got to look at it. Like in totality. I mean, nothing's the end of the world. Right? And with trading, you may lose money, and you probably will, okay, everybody's lost money. And experience is not cheap. Right? With that happening. It's, it's okay, you know, if nothing is, you treat money as, okay, you can be lost, and it can be one. And the whole idea of trading is getting consistent as a whole thing. And it's like, as you get better and better as a trader, I really believe in my core, you try everyone's trying to build that consistency. Okay, and you have to match your personality to that consistency Margaret: Do you also mean make money? Because that's my goal. Matt: Yes, consistently, or us to make money. But you need to be consistent to do that. Allen: So yeah. Well, like I say, In the beginning, it's not about making money. In the beginning, it's just about not losing money. So knowing what you do properly. And like, even if you don't make any money, that's okay. But you don't lose it month after month after month. Okay, I know, it's annoying, but that's a good thing. And then, you know, we could just do a little tweak here and there, and then then the the profits start taking off. So I totally agree with that. And see, because a lot of people that sell options, they'll tell you, Oh, yeah, you know, I have great months, and then I have a big loss. And then I have good months and have nobody wants to be on that roller coaster. Because eventually you're like, man, what am I doing? Matt: I mean, do you want to go make money in the beginning of the year, at the end of the year, you've lost money or just break even? It's, that's frustrating, you know? So the whole goal is to, you know, especially what you said in the beginning, it's very true. Yeah. Allen: So now you guys said that communication was key. So do you have any rules around that? Do you have like, do you like get together and say, okay, besides the trade trade talk, you know, when you have that, do you actually sit down and be like, alright, half an hour debrief, what do we do this week? How are we going to improve? Or is it just, Matt: I think I know what you're gonna go to. I think, I think, for us, and this is just for us, but a big part. And a lot of people think it's a dirty word. But a budget, we always had a budget always kept us in line, you know, and it's like, whenever we've kind of rapidly spending, you know, and aren't talking about trading, we're just talking about life and your budget, it always get us back on the road, so to speak. So that was a big piece of our communication. So it's just knowing that we're kind of on the road. So I think that flows into your trading and it flows into your communication. So I think that's a really big piece. Margaret: Yeah. And I would say like specific rules about communicating around trading, we've never said anything. It's just kind of happened organically. And we will, you know, there's there certain parameters that you teach in your class and we get in at a certain time and when we do that, we will talk to each other that day, and then we check it both together, generally in the morning, and we'll just kind of go Oh, or Yeah, and commit Write together or celebrate together. And then that I think, I guess that's the organic piece. We just check in with each other in the morning. Matt: Be like, Fine, quick text during the day, you know? Yeah. Margaret: Yeah. Because Matt is watching it for his day job. And he'll text me if something, you know, hey, keep your as open. This is happening or, but yeah, so I guess that's it like we wake up in the morning. We look at it, we chat about it, and then throughout the day, he'll text me. Or maybe if I'm doing something, I'll text him and say, Hey, have you seen? And he always says yes. But yeah, that's it. Okay, Allen: Cool. So what happens when one of you wins and the other loses? Matt: That's a good question. Well, yeah, I've lost before I've lost my I lost. I lost before. And oh, yeah. Oh. Yeah Margaret: Jog my memory. Okay. So I'm going to just tell myself here in the beginning, before we found your class, and I'm not just saying this, because this is true. So it's just true. We cannot say how much of course we lost $5,000. So $5,000 is, is a lot of work for me. And I, I am the one who had funded it that month, to the account, and Matt lost it. And we we realized then, that that was really tough. That was tough on me, it was tougher on me than it was him. And actually, our trade talk Fridays, were really good, because they had also lost the money. And I had lost a little bit, but not as much. We were all just really disheartened and frustrated. And I think I think I was a little mean was a little mean, Matt: Slightly slightly. Are you sure you can do this? Well, yeah, feel the weight of that. Right. Yeah. I mean, if you're not, your wife's out there, she's, she's busting her butt to bring in money, and then you just lose it. It's a lot of you feel the way that, you know, you gotta really dig deep and be like, okay, emotionally and you know, everything about to have the confidence to keep going, right? And you got to search and really believe in yourself that you can, you know, like I said, it's not the end of the world, but you have to get through there gonna be times like that. That happened. Margaret: It made me quit trading for a couple months. Yeah, I got really nervous. And then I said, okay, and then actually, that's is that that's about the time we found oil, wasn't it? Like we found oil sometime after that? It seemed to be a little exactly what you're talking about earlier, it wasn't as much of a roller coaster. And that has changed it for me. Allen: Okay, so was there anything else besides finding that strategy that was able to get you through it? Because like, I mean, emotionally, that's a it's a big hit. Right? And did anything change between the way you guys communicated the way you guys traded? Matt: No, I think Margaret took a little hiatus. I'm the type that I never, I never give up on thanks, I will just take it to the death, you know. I'm like, I just keep going no matter what, just get out of my way. No matter how many hits I take, I just keep going. And I leave it all on the table. So I just I knew I was going to keep going. But again, the key and I don't be, Margaret: but you. You did try it a little more conservatively? Didn't you? Matt: Sure. Yeah. I mean, you learn your lessons, you get burned out a little bit, you start to kind of, you know, you remember and you're like, Okay, I don't want to have those same feelings. But let me cautiously kind of figure it, learn from your mistakes, if you will, you know, and treat a little bit more conservative pay a little more attention. What can I learn from that experience? And I think that changes everything. Of course, you know, the strategies that we do, are a lot better, like I'm able to manage our trades so much better. I think that's important. Margaret: I think that's key. And I think that's key for me, knowing interesting that we have better management strategy now makes me feel a lot more secure, and a lot less emotional, and more. What's the word? I'm looking for sure. That Matt and I can both do the trades and not lose that $1,000 chunks anymore. Matt: More confident? Yeah. And I think I've read this before, and I really believe it is that you are your first really job is to become your risk assessor. And then you're a trader. Yeah. So it's like it's really important that you this all we do is assess risk all the time. So I think it's really important to, to focus on that. And once you get better at assessing risk and managing, just become a better trader, but you just kind of have to go through those things. I mean, when I first started trading, they're like, Okay, your first loss is your best loss. And I was like, what does that mean? They don't want to lose you. And like, they said it all the time, like, Oh, your first last year about like, Who is this person? Like, why did he say that to me? I don't want to lose. But it is true. Like, it teaches you things that you just, you think, you know, you like, oh, yeah, I'm gonna get out of that trade, I know what I'm doing. And then you get burned. Everyone's got to touch the stove, apparently, at some point, you know, it's like, Oh, don't touch the stove. It's hot. But of course, we gotta go touch it. But that's just life. I mean, and it's how you react to those situations, I think. And you don't you don't tell yourself that you're not? How are you going to respond to that? Is very important. You know, in all aspects of life as a trader anything. Allen: I mean, a lot of people, you could say that, but it's not as easy when you're going through it. You know, the first time Oh, first time you do it, it's like, ah, people behave in all crazy different ways. Matt: Yeah. Yeah, it's just, you're gonna have to, I guess this, the best way is to do the best you can to bring people through that experience. All right, you can tell them that it's it probably will happen. But how you react to that situation? It's good to kind of tell your future. Margaret: We're model citizens is that? Allen: Well, I mean, they say that, you know, most divorces are caused because of money issues and problems. Yeah. You know, and a lot of people do not see eye to eye on money. And they don't talk about it before they get married. They don't talk about their goals, visions, whatever, or even how to balance it, you know, like, oh, yeah, one is a budget person. One is a non budget, I'm going to spend whatever I can, but it's like, a lot of people have these issues. And it's, it's great to see that you guys are same page, you know, same goal, same like, okay, hey, you guys talked about it ahead of time. Yeah, like, this is our vision. This is the goal. How do we get there, we'll change you know, like, we'll go on a different path. And we'll try and we'll try this. And like, you guys first started with the passive trading course. Right? It puts in the calls and, and then you say, Okay, let's graduate to something else. So then you guys added the oil program. And then you guys have been doing that. So you just added to something. Now you guys have even you know, got you got your own Airbnb now. So congratulations on that. Margaret: Thank you. Allen: So you're diversifying? So yeah, you're trying different things. And nobody says that you can't right. So you should you should work and in us every strategy available to get to whatever your your dream is. So in that sense, you guys have done a bunch of different things. How do you handle it when you disagree? Margaret: Like disagree on? Allen: On the path, disagree on maybe a tray disagree on let's say, you guys did the Airbnb? Maybe Matt would be like, yeah, no, I don't want to do that. And I want to put more money into trading account. Because we already know we're doing well here. Matt: I hate to disappoint. But I don't think we disagree on too much. If we do, it's like, you know, we do. I'm not saying it's easy enough. I mean, marriage is not easy. But we have their situations, I think it's important to you just you take a pause. You kind of realize how you're dealing with it personally, how you're, what you're thinking, what you're you're feeling, and then you come back to that person and you talk about it. Margaret: I think to just thinking about our investments so far, we do things that we are confident in our knowledge base around so I've had a real estate license for five years. And I shoot real estate and I understand real estate. So when I said Hey, Matt, let's buy this, Airbnb. He was like, Okay, sounds like a good investment. You've done the numbers. I trust you. Matt: Yeah, I do. I trust that she's, I've seen it, she's she's in that field, she does the work. She's always trying to figure it out. And I, their word really is trust. I trust her that she's going to do the best she can with it. Margaret: And I think it's about Yeah, I think it's likewise to you, because I trust that he's, he's read. If you could say our library of books, it's literally every book I've ever heard of on finance and investing. And multiple copies probably down. And so I think, I think it all comes back down to we, we because we both feel like we have studied different things. You know, and now Matt learns more about real estate and I, I give him all the credit because I always was interested in retirement and investing but I didn't know where to get started. And so because he had a knowledge base, he kind of brought me up a little bit faster than if I had then what I was able to do on my own right. So that's powerful. And then because I already trusted him so much and then we got to go to all the seminars together. It just build that built that foundation and so now we really don't disagree on Matt: I think part of also is like, I never wanted to push that on Margaret. Yeah, like my interest, right? I have interest in finance. I never wanted to push that it's an interest of mine. Real estates and interests of her. She doesn't push that on me. I don't push that on her. So it was, it becomes organic when you are you, you're interested in yourself, right? You're like, okay, you know, Matt's doing something. I'm interested in that I want to see a little bit more, but it comes from her. It doesn't come from me telling her Oh, you got to check this out. You should check this out. Yeah, that's important. But ultimately, it's gonna be her decision. Right? Yeah, Margaret: You start to for me, I started doing the numbers. Whoa, you can make this on a trade in two minutes. And I make this on how many? How many hours? Does it take me? Yeah, that's a no brainer. Allen: Cool. Okay, so now, so a lot of our customers they've been through. And unfortunately, like, they've gone on a path similar to yours. But I would say that you guys, you know, if you've, if you only started trading, like three years ago, you guys have taken a shorter route than a lot of our customers. Really? Yeah. So they've been trading for multiple years, still trying to figure out like, Hey, how can I make this work? How can I become consistent, profitable, I've tried, you know, XYZ strategy, and this and this, and this, and they've bought cores, and they've been videos and seminars, and, and they still are looking for that something, to get them over the hump, to get them to be like, Oh, finally, I'm actually making some money. Finally, like you said, they're confident that they can, you know, the month is going to start, I have a strategy that works. I'm confident I'll probably make money this month. But they're still not there yet. And because of that, because of them, you know, trying and investing in course, investing in Seminar investing in another doohickey. You know, they have all the things you can buy, like, Oh, hey, you know, that you can buy this indicator, and the indicator will tell you exactly when to buy and when to sell is only $3,000. You know, they're like, Okay, I'm gonna get that, you know, they get it and then they don't doesn't work. And then the wife or the other or the husband, either way, the spouse is like, I can't believe you're wasting all this time, all this energy, all this money on this trading stuff when he doesn't frickin work. You know, you've been trying for years, and it's just not working. It's all a big scam. Right? And that's the big girl. Yeah, it's a big scam that nobody can do this. So what advice or tips or anything? Would you suggest for a trader in that position where their spouse is maybe not very receptive to them continuing to trade? Where the spouse is like, you know, can you just give this up? You know, just spend time with me? Just, you know, Matt: Yeah. I'm gonna let you go first. And I'll go after. Margaret: Okay? Because we, we were not in that specific scenario, I just keep going back to it has to be the trust. So how are you going to build trust with your partner, not when they don't know what you're going through? And then I would say you would have to have some sort of mentor, and to be honest, that is you that that is you for us. Right? So we I remember, when I got the calculator that you sent out of this is where if you this is what you need in order to make the monthly income that you want on the percentage of money, and this is how much money you need in your account. And you've done it, like you've gone before us, we know it can be possible. So we're trusting that what you say is true. And we've seen it and especially now that that works for you. So I think finding somebody that you can put that trust into and having if your partner is not going to be in that with you, at least show them who that is that you're learning from or what they've done. And if if it's if it's not Alan Sama, then make sure that they've got a good record of what they've done. So that, that your partner can have trust in that you're learning from somebody that is credible. You know, the first thing we learned from had learned down the road from somebody who had learned from Warren Buffett, and so, you know, I don't really care about names of people, that doesn't impress me, but when you actually know something that impresses me, and that gives me the assurance to bet on myself. And that's what I would say, would be my advice. Matt: Yeah, I mean, I always went into investing, especially as I, you know, started to learn about options. I was like, I don't want to hear about oh, you can make all this money. You can do all this and everything's going great. I wanted to go and be like, show me how to do it. Right. And then once you show me how to do it, I believe you. And that's just who I am. And I think most people maybe are like that they want proof and they but more importantly they want to be be able to do it themselves, some people don't. But if you're into this and you want to learn, and you have to go into mindset be like, show me how to do it. And then you get the confidence that you can do it yourself, and then you can be able to teach other people. Allen: Okay, nice. Next question I have here is that you guys have been doing this for a little bit together? Are there anything thinking back that you would do differently? So basically, the question is, like, you know, are there any tips that you would give to a couple starting out? Or lesson or something that you felt? You know what, we didn't do that? Right? Maybe we should have done it differently? Margaret: I would. I know that $10,000 was a lot for us, when we bought into your class. It was 100% worth it. And I wish that we would have done that first. Matt: Yes, I think in this world, you know, you don't want to believe it, but you really pay for what you get. You know, it's a hard truth. Lots of people want to be like, oh, I want this for, you know, low money, or I want this, but you got to really look at is it? What's the worth of it? Right? Is it going to be? Margaret: And are you willing to do the work? Matt: Are you willing to do the work? That's a lot of people like, I think the advice I give people is like the least tell yourself before you think something is not worthy, or it doesn't go up to your expectations, at least go through and do the work of what has been laid before you. Okay, so you have all these lessons, and you have all everything, but you have to can you really tell yourself that you put on all the work, when you haven't gone through the class, when you haven't gone through all the, you know, really dug deep to get everything out of it, then you can say whether you want to continue or not, whether it was a failure, whether it was not at least do that. And I think it's important for people that start out, set aside a small amount of money, right? And maybe agree that, okay, if you lose this small amount of money, it's a good idea. Fine, it didn't work out. But at least you agreed on that. And then give it a shot. Yeah. Right. And then maybe if it didn't work out, and you want to go further, we examined it at that point. That way, you know, it's not like a, I lost everything. And it's the end of the world type scenario. At least I gave it a try. You know, I followed my dreams to figure out this on my own. And if you at least put in the effort, you can tell yourself, Margaret: I would like to give your wife major kudos. Since you said you lost a lot of money in the beginning. That's a good woman to keep if she kept supporting you to go forward. Allen: Yeah, yeah, I'm, I'm very blessed. I am amazingly blessed. So I just give you a short version of the story. I had just been laid off. And so the question was, and we had just been married recently. And so the idea was, Okay, do I go and get another job? Or do I try something else? And, you know, I had been dabbling with trading. But I was like, maybe I could do this full time. So she's like, Okay, if you think you can do it, go for it. And, of course, I did not have any money. She had money from that she had saved up from working for several years before we got married. So she's like, you know, I have all this in savings. You know, try it. And so then she got a second job to support us. So because I wasn't making anything, so she got the second job. And she's working. She was a nurse. So she was working like three days a week at the at the hospitals, 12 hour shifts. And then on the other day, she would be, they have this thing called home health, where the nurse actually shows up to your house. So she would be driving around town, going from place to place to place, you know, giving injections and IVs and medicines and all that stuff. So very draining, especially with all the traffic and everything. And yeah, and I proceeded to try everything like day trading and futures and forex and commodity options and everything is like nothing was working. And I was down over 40 grand. When I finally actually, I think what turned it around was that she found out because I was hiding it from her. Like I wasn't telling ya that she came on to check the mail. She checked the statement. She's like, where's all the money? Oh, like, oh, yeah, about that. So it was either Yeah, you know, it's like, okay, either go to go get a job right away. Turn this around. Or, you know, if you don't do one of those things, we're probably getting split, right. So I was planning like, I was getting my resume ordered together. And then I found selling options. Like I discovered that Hey, there, there was a trade I did that was actually it worked. And I'm like, Well, what is this? Let me follow up more and then I got into it and I showed her how to do it. She was like, Okay, you have something here. So you'd like you said I did Didn't I put like all the money aside? You know, I stopped playing with all the money. And I took a small amount. And I'm like, Okay, let me see if I could just do something with this, instead of the big amount. And that gave her pause, like, okay, fine, you know, he's not gonna lose all the money. And if I lost that money, then yeah, go get another job. And that's it, end of story. But luckily, I showed her she understood it, it started working. And then you know, then the rest is history from there. Margaret: I can imagine there's some pretty real feelings going on around that. That's Allen: Very stressful. Yeah, very, very stressful. Because she wanted to know what I was doing. But she didn't have any background in finance. You know, her family never talked about investing or anything. So she didn't really know anything about it. Slowly, slowly, I started telling her. And then the funny part is, she would come home, like, and she'd be like, Oh, hey, she got interested, right? And she would come home and she goes, Hey, I checked the news and the markets up today. And I'm like, Yeah, but I'm, you know, I'm in. I'm in calls today. Oh, there she goes, Oh, no, oh, that's too bad. You know? And then two days later, she'd be like, Oh, look, I checked in the markets down today. I'm like, No. I mean, Puts today. She would like she did, she wouldn't know if I'm gonna be happy or sad. But she was nuts. But yeah, so and then after a while, then it got good. And like I said, you know, she wanted that stability. She didn't want that up and down. She's like, I need something stable income, so I can quit the second job, take okay. And then she was able to quit the first job. And then so it worked out. But yeah, it was a long, hard road. And I did not have the mentor that you mentioned, you know, so that was one of the probably the biggest things that if I could have found somebody that could have just pulled my hand be like, here, this works, just follow this plan. Margaret: You know, that's why we got to shortcut it. Yeah. Allen: But.. Matt: I think that is a hard thing. Because you're always trying to search for, you know, they're always there numerous or many mentors out in the world, it's like, is trying to find who's true, right? That's it's very difficult. And you you have a guard up, everyone's got their guard up. And they're always kind of like, is this person trying to take me or, you know, I don't feel right about this person, I maybe feel right about this person. I mean, just look at FTX. I mean, that guy that was like darling, and crypto. And then they find out he's, he's, you know, a Bernie Madoff. So it's like, it happens over and over again. So that's kind of how I got into trading. I was like, show me how to do it, and see if it worked, right. And you're not only a mentor, but you show people how to do it. And then you can build trust in yourself, rather than, you know, of course, a mentor is wonderful. And it will shortcut that process. But you can learn about this stuff. And then you, you make yourself your own mentor in a way, you know, it's like you just kind of be like, Okay, I have the confidence now. And then you can go on. Allen: Yeah, I think it all comes down to confidence too. Because like, if I look at it, you know, we have several students that in any strategy that you pick one strategy, and then there's somebody there that's been like, Oh, hey, I did you know this much percent? And I'm like, wow, that's better than me. And there's another strategy. Oh, I did this much. And I'm like that better than me. And I know that, like, what everybody's doing better than me what's going on? You know, but I think that's part of it is the confidence. There's like, and this will tell you something about me, like, you know, I came up with the rules, right? So I came up with the test and testing it and failing, and I forgot what they call it. But it's like, you know, you, you try something and then you fail, and you try and you're failing, you chaired it. So in my mind, you know, all these rules are made by me. Right? So I was like, I don't know how much I can, you know, like, really? I'm gonna trust myself. I don't know. It's scary. But then somebody else comes and goes, Oh, Allen, you know, he's the man. He knows what he's doing. I'm just gonna go 100%. And they do. They do better than me. And I'm like, I don't get it. Matt: redo my rules. Allen: I just need to, I just, like, forget it. I just give you guys my money's like here. Matt: But I mean, in all seriousness, as well, I mean, people, they come in these programs, and everyone has so much to add. I mean, that's how you get better. I mean, there's people that are just like, oh, yeah, I did this way. And you're like, Oh, I didn't think about that. And it's like, if you're open to that, and you receive that, then it makes everything better for everybody. And I've seen that over and over again, where somebody will just say, Oh, I found this way to do this easier. It's like it's constant learning. All of us are constantly learning constantly getting better constantly trying to achieve and go go better. And that's a wonderful thing. Allen: Yep. Yeah, we had an hour. Just recently, we in our passive trading group, somebody had put like, Hey, I don't know how to do this. And I'm pretty sure it's in it's in the core somewhere. But then another student was like, oh, here, let me make you a video. And he just made a video. Yeah, this is how I did it. It's like, Oh, wow. And they asked another Oh, how about this, he made another video. It's just, you know, everybody's helping each other because we all have the same goal. And it's like, Let's just all work together. And, you know, we're all on the same path. Matt: Yeah, it's like, it's always true, you surround yourself with the right people, and good things will happen. I mean, it's just just got to be able to do that, Allen: you know, it's like, amazing, we had some really cool students, helpful, you know, just to go out of the way for each other. It's really, really nice. So then, okay, so my last question for you guys. And I don't know, maybe you guys like, maybe this is a problem that we've seen people have, but I don't know if you guys are gonna be able to answer it. But how can a trader have their spouse support them in their trading? So like, you know, if, you know, one of you is the trader, or you want to do something, how can you get your spouse to have that confidence in you? That you can do it? Does that make sense? Yeah. Because like, I know, with my wife, in the beginning, she didn't have any confidence. And then later on, you know, the numbers kind of spoke for themselves. But one of the things I did was when the back testing software came out that we that we use a lot, I showed it to her. And she was like, Oh, cool. I want to learn this, too. So we would sit there, and I gave her the rules. I think we were talking about credit spreads at the time. It's like, okay, so this is kind of how we find a trade. And I didn't have like, first set out rules yet. It was just, you know, ideas. I try, sometimes they do this way, that way. And so then I had her and I told her what it was. And we would look at a chart and be like, okay, hey, what do you what's the trade? And so she would pick her trade? And then, you know, we would we would go through it. And then I had already done it my way, you know, and it would always come out where she was actually more profitable than me. Same trade, same stock, same timeframe, if we had done it her way, we would have made more money. That's the thing about the confidence. He knows, like, when you see your wife who doesn't know anything, she just numbers, you know, she doesn't matter. It's like, I don't know, maybe I'm not cut out for this. But then, but then later on, there was a time where I got into like, a, like a rut, you know, so I wasn't I wasn't following the rules, the discipline became a problem. Because our trading doesn't take a lot of time. And so when you're just, you know, stuck, you don't have anything else to do, you kind of start over trading, and you're messing around with stuff. And so I had her, and she came, she's the one that came up with this. She's like, you know what, every single trade, you're going to write it down. And you're going to tell me, and I'm going to come upstairs at one o'clock every day, I'm going to ask you questions about every single trade, you know, and I forget exactly what they were. But it's in one of our products. It's like, you know, what's the goal? What's the plan? You're going to adjust it or you're going to get out when you're going to do it? Where's it now? And why haven't you done what you're supposed to do? You know, and so because of that, because I knew she was going to come? Right? I would have everything ready before she came in. So if I had to get out of a trade because it was down or I needed to do an adjustment, it will already be done by the time she got in. And so that degree of holding me accountable. It really I mean the results just went skyrocketing higher. That's really smart. So that was.. Margaret: something that you said yesterday on our call on our oil call really has stuck with me about every day that you wake up you have a decision to stay in that trade or get out so that's the day that you're making a decision. And it's not Yeah, so that it just hit me this morning because we had the the market was down a little bit this morning. And we talked about it like what what are we going to do so I like that idea of having an accountable Matt: Well, it's important because you're you yourself are going to be emotionally different each day for whatever reason, just as you as an individual that but now you have your wife or someone who was account recording accountable is going to come in and keep you straight. I think what every what everybody needs Allen: Yep. Either either spouse or buddy or accountability partner or something like that, that you can trade with. Trading buddy, I like that. Cool. Okay. Is there anything else that you guys wanted to share with our audience? Margaret: Hmm, you can do it. You can absolutely do it. I think if I could have told myself which I had zero knowledge background in how what what was a brokerage? Let's just start with the simple step. I did not even know the difference between brokerages I did not understand what a brokerage account was. So if I could Tell Margaret, even just five years ago, what I will be doing today, I would not have believed it. And that once you start looking at your money, you know, everybody always says nobody cares about your money more than you do. I think our age group needs this knowledge. Because with the advent of you having to figure out your own retirement and not having pensions, it is extremely important for us to know that and we didn't have any knowledge that is out there. You know, we didn't we weren't 20 and Tiktok. And Instagram rails were out there where you could learn some of this stuff. You know, we're where we're younger people already know so much more than I knew when I'm in my 20s. I think there's a group of us that needs the hope that comes from knowing that you can manage your own money, and you can make money and you can help your retirement, it doesn't matter if you're in your 40s. Matt: No matter really what age you are, I mean, my mother's 80, right. And if she was, you know, I used to stay at Costco all the time. And I said this many times where they're, they're older people that give out samples or they're in the job. And there, you can see that they're in pain. They're standing all day long, and they're like 70, and 80 years old. And if they just knew if they knew how to do a simple strategy, or trade or just learn it, in which they totally can, yeah, or be shown that and, you know, they can believe in it, that would change their life. And they change their comfort, not later on and be right now. Yeah. Which is so powerful. So it's really it goes to, that's what I love about trading, it can help all age groups. Yeah. Right. And you're right. No one cares about your money more than you do. And I look at like, life's risky. Everything's at risk. So you owe it to yourself. You think trading is risky. Give it a shot. Everything's risky. Yeah. Right. So you got to overcome your fears. See how things work? Believe in yourself. And just go for it. Yeah, because we're only on here one turn, you know, Margaret: Why not? Give it a shot? Allen: Well said Well said, you guys, I really thank you for this. This has been a pleasure. And I really appreciate your time and spending some time and sharing intimate details about your lives and your relationship with us. It's it's been a blessing. Thank you so much. Margaret: Thank you for asking us. Yeah.
Does Personality Affect Trading Results? - 143
26:17Does your personality make a difference in your trading results? Turns out, it makes a huge difference. And so today I want to talk about two different personality types. And I want to talk about the pros and cons of each and how to tell if you're one and how to improve your trading based on which personality you are. I bet you've hardly thought of the possibility of your personality having an affect on your trading results. But scientists have. And they have that one personality is better than the other. In this episode we talk about those findings and how you can improve your trading no matter what your personality. JOIN OUR FREE PRIVATE FACEBOOK GROUP: https://freeoptionsgroup.com Like our show? Please leave us a review here - even one sentence helps. Thank you!
Best Option Trading Books - 142
11:23Hey there, this is Allen from Option Genius. One of the most common questions that we get at Option Genius is, "Allen, I want to know more about options trading, What books should I read?". And so I made this short video for you to tell you some of the top books that I think should be in your library. There are hundreds and maybe even 1000s of books on there on options, but not all of them are worth your time. Okay, so I wanted to save you some time, tell you the ones that I think would be the best. So here we go. This is the first one. Now these books are in no particular order. But this one is "Options as a Strategic Investment". Now this one is the heavy hitter. Okay, you can tell this is thick, it's very long, it's very detailed. This is like the Bible of options trading, okay, now, you're not going to make it through the whole book in one sitting. And you might never make it through the whole book. I've tried it a couple of times falling asleep. But this is not meant to read cover to cover. This meant this book is meant more as a reference book, at least that's how I use it, if I need something, or if I need to look up something, especially when I was starting out with options trading, this one was very helpful. You know, it was it's a good source. There's a lot of good material, a lot of good examples in here. And it covers just about every single thing about options related in here. So if you're just starting out, and you need one book as an introduction to options, this one might be a little bit too technology or jargon heavy, but it's a good one to have with you. Okay. Now, second book I have here is called passive trading, how to generate consistent monthly income from the stock market in just minutes a day. Now, this is the book that I wish I had when I started trading 15 years ago. Okay, now, to be honest, I have written this book. So I'm the author of this book. So I'm a little bit biased. But you can tell it's a decent sized book, this is not the goal for this book was not to cover every single strategy and every single way to trade options and everything about options. That's what this book does. So we don't need to recreate this book, what I put in this book is what I need, or what I think you need to make money the fastest way possible with options, okay? The the how to think about it, why you need to start trading options, and the strategies that you should use to really simplify your trading, and really get going and making money quickly as quick as possible with Options. So that's why I've written this book. That's why it's on my list, because I think everybody who trades options, at least if you're, if you're just starting out, you definitely need to read this book. Okay. And the other thing is that it talks about doing it in your spare time. So that is a whole different philosophy. We don't talk about buying options in this book, I tell you exactly why that doesn't work, I show you how to sell options in a way that doesn't take a lot of your time, so that you can actually make money from the stock market, but still have your time to do whatever you want. Because that's really the goal of making money, right? We want money for freedom, we don't want to make money just so we can work longer hours. So this is what this book shows you. The next book we have here is called "Generate Thousands in cash on your stocks before buying or selling them". Now, this book, I've used maybe the first two or three chapters, and the rest of it is about indicators, technical indicators, technical analysis, stuff that I don't use, I haven't even read. But the first two or three chapters have made me a lot of money. And so that's why they're on the list. Now, the strategies he talks about in the first couple of chapters are basically naked puts, and how to trade them and different ways you can use them. And like I said, it's made me a lot of money in the past. So that's why I put the this book on the list. Okay. Now, a lot of books out there, talk about the different strategies, but they don't tell you what to do. If your trade gets in trouble. They just broadly glance over it. So this book here is options, "The option trader handbook - strategies and trade adjustments". So this book actually goes into more detail about what to do when your trade goes into trouble, how to adjust your trade, and it covers different strategies and covers a couple of different adjustments for every single one. Now, it's not the same thing as watching a video or watching somebody actually do the strategy and think about it and tell you why they're picking one adjustment over another one. But when you have some ideas of what different adjustments you can do, then if you're trying to get into trouble, you can analyze them and see which one you like better, which one you think will work best for your bad trade. And then you can go with that and hopefully it will work out so it's a it's a good book if you don't know anything about adjustments. And it's definitely something you should have. Just in case a trade goes bad you don't know what to do. You can pick this up and look for ideas. Okay, now, for those of you who are iron condor traders, this one is is profiting with iron condor options, strategies from the front line for trading in up or down markets. Now, the reason why I chose this one, and it's not a very thick book, because it doesn't cover everything about iron condors. And if you want to know what an iron condor is, and if you're an individual investor, how to trade it, we actually have a course on iron condors that goes through all the details, adjustments, everything you need to know. But the reason why this book is on the list is because the fellow who wrote this book says he's a hedge fund manager, he runs a hedge fund, and he trades iron condor as his main strategy. So that means he's doing millions and millions of dollars worth of trades in the iron condor. So from his perspective, if you're an iron condor trader, this one was really cool to read to see how he does it a little bit differently than us individuals how much harder, he has a time to do the iron condor. But how he's still able to make very good profits, even though he's trading in the millions of dollars with iron condors. So this one was a cool fundraiser. Okay, the next one. Now, this book might be out of print, it's the complete guide to option selling, this one might be out of print. But if you didn't pick it up, us, it will be a good book, if you're interested in futures options. Now, the title is, you know, the company guide options selling but they don't talk about stock options. In this book, they only talk about futures options. Now, the reason these authors wrote this book was because they had a management fund, like a management company, so they wanted you to give them the money, your money, and then they would trade options for you. That's how they made their money. Unfortunately, they made some mistakes, and they blew up, meaning they lost all of the money for their investors, and they went out of business. So that's why I'm saying that the book might be out of print, because they don't need to use it anymore as sales piece, but it still has some good material and good information in there if you're looking to trade futures options. But keep in mind that the strategies in here work, if you have a lot a lot of money. Now I've tried trading these with a smaller amount of money, like you know what a normal person would have, they didn't really work out. So I had to test and tweak them in order to make them work. So if you aren't going to use this, the book, you need to know that they might not be ready for just, you know, follow along exactly as they say in the book, because, like I told you, this book was meant to be a sales piece. Not exactly, to give you a complete A to Z explanation of how futures options work. Okay, but it is good for futures options, it gives you some good ideas and some good things. So that's why it's on the list. And then lastly, I have a book for all you option nerds. Now, I have not read this book, I don't think it's necessary to understand everything about option volatility and pricing to make money with options. Now volatility, yes, pricing, maybe not. Because pricing is something that, you know, if you can, if you're trying to sell an option, and they're only going to pay you $1, that's all you're gonna get, you can decide yes or no. And if it makes sense for your risk reward on your trade, then maybe you'll take the trade. But, you know, if you want to really get into the weeds, and really understand volatility, and pricing of options, and how they're priced and why they're priced on certain days, so much, and how to take advantage of that, again, if you're playing with a lot of money, then that really helps if you're an individual investor, you're not going to worry about that so much. But this is a very, very jargon intense book. It's very dense. And it's good if you really want to get into the weeds. So that's why I have that one. Now, again, all these books are great. In the beginning, I think this is the only one you really need. Because that's the way I've written it. That's the way you know, this is like, okay, so we have all this information out there. You have all these different strategies out there. What do I start with? What do I do? Well just read this one. That's the way it's simple. That's why I've written it today. Hey, from A to making money as fast as possible. What do I do? That's why I've written this book. So hopefully, this helped. These are some of the books out there that I think can definitely help you. I've tried to bury them. But hopefully this helped. And if you have a book that I missed, or I left out of the list, please put it in the comments down below. Let me know what book you think should be on the list. And so when I update the video if we get enough of the same if everybody if several people say this book help them. If it's not gonna list we'll go ahead and add it. No problem there. All right now, take care and remember to always trade with the odds in your favor.
How to Score a Knock Out (KO) In Your Trading - 141
20:31Picture this, you're a prizefighter. A boxer. And your opponent is the reigning champion, large, strong, fast and deadly. If you win your payday could be huge. But if you lose, you might lose it all. Do you get in the ring? Well, if you're a trader, you get in the ring every single day. So let's talk about how not to get knocked out. Hey there passive trader, how do you think about your trades, and your trading can make a huge difference if you're going to be profitable or not. And I want to share about how I think about my trades. And I think that it's going to help you as well, because I've shared this with my students. And they it was really, you know, a different paradigm shift for them. So I want to say, Okay, well, you know, people don't don't see it this way. So I want to I want to talk about this. All right. Now, trading is more of a mental game than anything else, of course, you got to know what you're doing. But the mental aspect is what really separates new traders from professionals. And I've always said that trading is about 90%, mental, and 10% skills so if you have not become consistently profitable yet, it might be that there are some skills that you're missing. But there's a really good chance that there's the mental aspect is also holding you back. And it's actually something we spend a lot of time on, on our coaching calls with our programs with our students. And it's one of the reasons that we see people come into our programs that have been trading for a while, but they haven't received or achieved the level of success that they desire, until they start working with us. Because then you have a coach and the coach can look at what you're doing and how you're thinking and pointed out and be like, you know what, maybe if you change this, or you look at it a different way that he can make all the difference, right? It might be just that one thing that they're probably doing that the coach understands this is what's the problem. And once you fix that thing, boom, it automatically flips a switch, and then they become profitable really quickly. So that's why in this episode, I want to talk about the mental game, and really how we think about our trading as a whole. Because what I've seen is a lot of traders, they get bogged down in the minutia, they don't really look at their trading as the big picture. Right, they don't look at it from 10,000 feet above, and they're there in the forest, you know, they're looking at all the trees, and they can't see the clearing, they can't see the pasture, they can't see the big picture. And every single tree is a trade and all the trees and all the trades to them look the same. And they treat all the trades the same. So I want to talk a little bit about how I look at and think about my trading. Now to do so, we got to go back in time back to the future. No, back back to the past. Back to my youth when I was a little kid and I used to play this game called Mike Tyson's Punch Out. Right, it's on the Nintendo Entertainment System, which I think they make new ones now they don't make the old ones anymore, but they make the little mini versions travel versions. So this game is still around people still play it. Now I spent hours days probably the hundreds of hours if I'm truthful on that game. And if you don't know it's a boxing game, you know, like the fighting. Boxing, you know, the one guy fighting another guy. And if you remember, Mike Tyson was the heavyweight champion of the world and nobody could really touch this guy. I mean, the guy was was a monster monster like crazy crazy guy, right? So it is really a great metaphor because Mike Tyson is the market. Okay, truth of the matter is you cannot knock out Mike Tyson and you cannot knock out the market right? The market is just too big. So the market is Mike Tyson cannot come out and you're just this little itty bitty guy right we're just we're just at home traders right? We're just a little people. We're not even like big prize provisional trade Wall Street guys that have billions of dollars like those guys, they go against the market they might win we're just we're just little guy right? Even in the game your name was Little Mac and if you look at the game you were like about this big when Mike Tyson was like about this big so he was like 10 times bigger than you the gay and your day was even Little Mac so what about positive encouragement right up late i Big Mac know this Little Mac tiller, you're never gonna be able to knock him out. But you still want to win the match. Right? You still want to win the boxing fight. And the way that you do that is not by knockout. But you do it by points. And you in order to win the fight. Basically that means that you're going to be profitable for the year and you might be beat the market averages. So that is the goal. That is the overarching big picture. That's what we're looking at. We're looking at, hey, I want to win the match, I want to be profitable. And I want to beat the averages. That's my match. So in order to win the match, you have to win enough rounds. You get, each round is a month. Okay? So each match or fight has 12 different rounds. Now, you need to win more rounds than you lose, and you need to avoid getting knocked out. Right. So January through December, every every month is around, so we got 12 rounds in our match. So 12 Round bout, okay, and we're going to win by two things, we're going to get points. And if we get enough points, we win the round. If you win enough rounds, you can win the match, but you have to avoid getting knocked out. Okay, so when you are profitable for the month, guess what, you won the round, you win enough rounds, and you got a chance at winning this fight. And you get these points. To win the round, you don't have enough points. You get these points by making small hits, small base hits, right? We're just jabbing, jabbing, punching, jabbing, punching, blocking, jabbing, jabbing, punching, punching, maybe maybe a cross, maybe maybe an uppercut if you get lucky, right? These are all the trades that we put on. As passive traders, we're trying to hit singles and doubles. We're not looking for grand slams, we're not looking for knockout punches. Because even if you hit Mike Tyson, with what you think is a knockout punch is not going to knock him down. And he's going to knock you off bases of balance. And if he hits you with one of his big punches, you're gonna go down, you're gonna be in a hospital, it's gonna be over game set, match or whatever TKO not even TKO just want one hit, boom, you're done. Right? So that's what we're trying to avoid. Hopefully, you're not getting knocked out completely if you do get hit. And maybe you can, you know, dust yourself off and get back in the ring and be like, yeah, we're pulling me out a, pull me out, right. But a lot of traders, they don't understand this concept. And so they get knocked out. And they might not even be able to get back in, it's over. They give up trading because it's too painful. They can't handle it. They're knockout becomes permanent. And they are knocked out of trading for good. So we want to make sure that you do not get knocked out. That's the biggest thing when you're fighting Mike Tyson. Okay, and how do you not get knocked out? Well, he's going to be temperamental, he's going to be crazy. He's gonna get all excited and come at you like crazy every once in a while. You avoid that by using a trick. Now, in the game, you had to know the tricks. Okay. So the trick with Mike Tyson was that, you know, you hit him and you hit him and you hit him and you hit him. And all of a sudden, he makes a little move. It's a tell. And when you see him make that move. It basically tells you Okay, now he's coming. He's about to get ready. He's about to come at you with his big, big uppercut, to knock you out. And it comes super fast. It's like, you know, split seconds, I usually the move Oh, no, get out of the way. Because boom, if you don't, you're gone. So as soon as he starts making that move, you gotta get out of the way. You can't be in the way because, boom, you're on the floor, right? So you gotta get other way. And if you do, then you can start hitting them again, boom, boom, boom, and it is like starts over. That's kind of what the market does, right? It's kind of like the stock market does. Markets make big wish moves up higher, wish down higher, either up or down? And then it gets tired. So here's another metaphor for you. Right? We're talking about boxing and as the market but how about the market is like an elephant. So when an elephant is mad and stampedes. That's my elephant noise. It starts running around. And then you of course, you don't want to get in front of an elephant when it's damp eating and is running around. But eventually, the market, the elephant gets tired. You know, it starts panting, it gets tired. I don't want to run around anymore. And then it stops and maybe a standstill or you know the market goes starts going up and down a little bit or you just find a bottom and find the top and it just calms down a little bit right. I'm sure you've seen this with the market. We have periods with like high volatility, and then things calmed down and you think, Oh, it might be over. Sometimes it is. Sometimes the market gets jazzed up again. It comes at you again. And so that's what Mike Tyson used to do. He would try to knock you out. Right? And then he would calm down And then he would let you hit him a few more times. And then you're trying to score as many points as you can, before he dressed, it knocks you off again, and then you get out of the way again. And then if you do that enough times, you can actually win. So you got actually beat Mike Tyson. Now, truth be told, I don't know what actually happens at the end of the game, because I was never able to beat Mike Tyson. But I know that I've been through several years of trading where I have come out ahead, and I have won the match. Right. And it's, it's a phenomenal feeling, you know, to show my guns here, my little want to be guns. In me, it's such an amazing feeling to be able to know that look, I can go into the market. And I can just extract money, and I can be self confident. And I can know that I can take care of my family, you have that confidence in yourself that, hey, look, I can go into the market anytime I want, and just take money out, right? But the trick is to manage the trades properly. So you have to know when you should be punching. And when to get out of the way. We cannot control the market. But we can avoid the uppercuts. And this is how you do it. So you don't look at every single trade as an individual event. Right now, when you're taking notes, and you're looking and you do the analyzing. They're like all different things, right? It's like, well, this trade this trade this trade, but don't look at them, as all individual events, they are all part of something bigger, you won't win on every trade. So don't try. Yeah, that's right, I'm telling you did not try to make money, okay, you're not going to win on every trade, don't try. Remember, your goal is to win the round, not land, every punch, there's gonna be punches where you miss, there's going to be punches when you try to hit him, and instead he hits you instead, and you're going to have a loss. That's okay. Because if you try to make money on every single trade, well, you're gonna go crazy, right? And it's gonna be too stressful. Plus, it's not possible. So you look at every round as an event every month that you're trading is an event. And then you look at the entire match the entire year as an event. And that's how you save yourself. You look at the big picture, the eyes are always on the big picture. The eyes are always I don't, are always I want to win the match. Not I want to land this punch, right? So I look at all my trades as a group as a collective. So if I've already made money in a month on four or five trades, and then I got this one tray that might be losing money, I asked myself, What do I want to do? You know, What are my chances that I can make this trade work? Do I even want to mess around with it? There are some times when I don't? Or do I just want to get out and be done with the month and win the round. Now remember, we call this passive trading, right? So I want to do as little work as possible. So if I put on trades, and they're doing great by themselves, and I can get out perfect, but then I put on a trade and it starts not behaving, it starts making me do work, like watching it and analyzing it and trying to adjust it. I don't want to do the work. So if I've already made positive trades on one side, then I have this one one trade not acting properly, I'm going to take a look and say, Okay, how much money have I made so far? How much money am I down on this one? What happens if I try to get back? You know, what's the difference? What is a percentage? Like? How am I going to be up? And if it's not worth it, which most of the time it's not, I'm just gonna get out of that trade. I'll be done for the month, and I won the round. Geez. Right. That's the most important part, winning the round. So if you win the round, and the next and the next, eventually you can win the match. But if you start messing around and playing with every single trade that's going bad, and you try to adjust your way out of it, or you don't do anything at all, because you're like, oh, no, he's gonna turn around, you let her run all over you, you get that there's a chance you're gonna get hit by the uppercut. Not only do you lose the round, but there's a good chance you're gonna get knocked out so badly that the whole match is over. Right? Even if you don't get knocked out completely, you get knocked down three times it's TKO, right? technical knockout. You don't want that either. Not only the match, but in this case, your entire boxing career. Your trading career could be over if you take a big enough loss, and we don't want that. So we don't want you losing all your money or suffering the one large knockout loss, right? everybody complains, and when it comes to trading and selling options, they're like, Oh, I win, win win, but then I give it all back. That's what we'r talking about. How do we avoid that? So you go into every single month, and every round with the goal of just getting enough hits to be profitable. And if you don't win that month, no problem. It's a long match. You got 11 more rounds to fight, right? Big picture, big picture, think of the big picture. So let's say it's the first trade for the month, okay, and it's going bad, nothing, man, first trade, and I'm already going bad. But then you think about it, you know, like, I got several more trades I'm going to do this month, do I really need to fight this one. Or maybe I just get out and take a loss because I can make it up on the next ones. Because my goal is to win the round, right? You can do that. Or let's say you've already been successful on several trades for the month, then you definitely don't want to have one loser, take it all back, you don't want to give back all your gains all your work, right? That's the biggest gut punch you can get is if you've already made several trades, you've already put in the work, you've already made money, you're positive on it. And then you got one trade that you try to mess with, or you try to adjust or play with it. And it just causes you to have a large loss, and you give it all back that you made, and maybe even more, that feels horrible. And you don't want to do that because you want to win the match. Right? The big picture. That's the whole point. That's the goal. That is how I think about my trade. So every single trade is not a life and death situation, you're gonna have 1000s and 1000s of trades over your career, and you're not going to win on all of them, not even close to all of them. Or we don't even want to why bothered, we don't want that stress. So you don't need to worry about it. Don't let your losing trades cost you the round. And get this, you don't even have to win every round either, right? That's where it gets really, really big picture. And there's one more step that gets even bigger picture. You don't have to win every match, either. Right every year doesn't have to be super profitable, there are going to be years when you lose money, sometimes we just can't help it, there's nothing we can do. The market is a market, it's going to it's going to hit us and you're gonna take it you gotta take losses, you just have to make sure you don't get knocked out so that you can come back and fight the next fight. Right. And with passive trading, you're going to win enough rounds, sometimes it just happens automatically, because the stats statistics are in our favor, right? You're just going to win it, you're going to win loss arounds, and you will win enough matches so that overall your boxing career will be a very successful and will be a very lucrative one. Over time. I keep saying this over time the math just works out, play the trades properly, and you'll win in the long run. So there you have it folks, proof that kids do learn from video games. So if this was helpful, I would love you if you could do me a favor, please subscribe and comment so that more folks can find our content. You know, so we can spread the word about passive trading and help more people and it means a lot to me as well. So until next time, trade with the odds in your favor. And watch out for Mike Tyson's uppercuts.
The 66 Trade Challenge - 140
13:24Do you have a problem with trading discipline, or not sticking to your trading plan, or not getting consistent results from your trading, or even getting stuck like a deer in the headlights when a trade goes bad. Let's go ahead and solve that right now. On the other side of the intro. All right, so what does brushing teeth have to do with trading successfully? Everything. But you didn't know that. Right? And it's the key to improving your trading, which I'm going to show you right here, right now. This is why we don't stick to our trading plan. Wait, you do have a trading plan, right? Because you don't want to be trading options without a proven trading plan. One that actually works and is proven to be profitable, not just something you saw on some random Youtube video with something that is actually tested with real money over several years in up markets down market sizes and markets everything and you know, hey, look, this works. Other people are doing it. Other people are using it, you need to do the same thing. If you don't have such a trading plan, contact us. And we can help you. Okay, go to our website, or email us or contact us here, leave a comment, do something we'll get to you, we'll get help, right, because we have these plans, we've been doing this. So if you don't have a plan, get a plan. Today, I want to talk about why we don't stick to our plans, why we don't stick to the rules. And there are many reasons. It could be lack of discipline, could be going with your gut, it could be your technical analysis telling you that the trade is going to turn around. I don't know, maybe a little birdie told you that is all going to be okay. Right? And on and on and on. There's so many different reasons why, you know, we're supposed to do something in a trade and then we do the opposite, or we don't do anything at all right? It doesn't matter the reason that's irrelevant. What matters is that this is the reason for what I call roller coaster syndrome. This is where you do well for several trades, you're going up the roller coaster of profit doing good, then all of a sudden you fall. And you give it all back and maybe even more, then you do it again. Then again, and hopefully you don't have two drops, right in a row, which could knock you out completely. And you're like, oh, man, this trading stuff doesn't work? Well, it's because you're not doing it right. So if you've been trading for a while and you're not consistent, you know exactly what I'm talking about. Now, if you're newer to trading, and you don't know what the roller coaster syndrome is, that's great. You're lucky and hopefully you never do as long as you follow what I'm about to tell you in this video. Okay, let's get back to brushing your teeth. How do you brush your teeth? How do you take a shower? How do you put your clothes on? I don't want it in my head. I'm not asking you for specifics. Okay. What I want you to do is realize that you do those activities the exact same way. Every single time. Every single day. Like clockwork, think about it. How do you brush your teeth? How do you take how do you how do you take off the toothpaste cap? How do you put it on thing what handy you use? Where do you go you go left to right right to bag you do the top top you do top first bottom first tongue first. What do you do? It's always done the exact same way. You're putting your pants on the the one leg always goes in first, whichever one you choose, but that one goes in first every single time. Why? Because you're used to doing it. Because it is a habit. Yeah. So look, our brains have tens of thousands of thoughts every single day. Right scientists have studied this and they get come up with the number, whatever, it doesn't matter what the number is. But what matters is that the majority of these thoughts, almost like 89% of them are the same every single day. And that's why we don't have brain overload. Right? That's why we can do things in a normal way over and over again, without having to think about it. Because subconsciously, the brain is working. And it's doing it is thinking, the brain is thinking, well, we don't realize, and those things happen. We make them happen with our body. So, you know, gonna get in the car, what do you do, sit in car, put coffee down, put seatbelt on, right on this way. Press, press on the brake, hit the little button that turns on the car, you do it every single time. So our brain handles all of that for you. You could probably put your car on blindfolded, because it has just become a habit, you've done it so many times. So what you need to do to improve your trading is to make your trading rules, a habit. Following the rules becomes a habit, no more thinking about it. Make it subconscious. I don't know what the subconscious is, maybe back here up here, I don't know. It's somewhere in your brain, make it go there make your rules go there. And less thinking, more trading by the rules. So to do that, right, to have it become a habit. Scientists have done lots of studies. And recently they did this really massive study. And they determined that the average person on the average task needs to perform that task 66 times in a row to make it a habit. Now I know in the past, people have said, Oh, yeah, you need 30 days in a row to make it a habit. No, it's not. This study blew that out of the water. They haven't actually, you know, it's actually scientific. Now, they did a whole study. Now, that's average 66. The more complicated the task, the more repetitions it takes. And for some people, it took over 200 times to form a habit, but it can still be done. That's the good news. Right? So then here it is, this is what you need to do in two steps. Number one, you got to make sure you have a trading plan that works. Number two, you do the 66 trade challenge. What is that? Well, I'll tell you, it's simple. The next 66 trades you do, you do them by using your plan, no deviating no using your gut, no praying. No birdie is flying around telling you what to do. Take the plan, follow the plan. No deviating doesn't matter what the market does doesn't matter what the Fed does not it doesn't matter what the company is doing. Follow the plan 66 times in a row. Why is that? To make it a habit. And what happens if you break the streak? What did you get to like number 60? And then you decide oh, no, I gotta go with my gut on this one. No, you start over. You do another 66. But, but but but but but but isn't that hard? Oh, but trading is supposed to easy? Yeah. It's hard. Making money from trading is easy, but only if you do it right. If you're not following the rules, you're not doing it right. And until now, you're probably not doing it right. Because that's why you're not consistent. So you take it from somebody who is consistent, right? This is what I do. This is what I do. Trade that follow the rules, okay? And then give you the rules. And then you tell me, I didn't follow the rules. Why not? That's why we have this, right. \ That's why I'm talking about it to figure out another way to get you to follow the rules. So I've come up with this 66 trade challenge. That's it. But wait, you went into trading? Because you wanted freedom? Right? Yeah, man, I don't want to be stuck to my job. I want freedom. I want to make my own decisions. I want to follow the markets. I want to trade, bullish bearish, all this stuff. You want to be able to make your own decisions. Fly by the seat of your pants. Well, sorry to hand it to you. But trading plans are restrictive. Okay. You're not a robot. We know that. And you should be able to change your plan when the markets change, right? Wrong. No. So here's the truth. This is a big truth. So so listen in, okay. Trading well means that you follow a process that is proven to work. There is no freedom in that. You follow the rules, and you benefit. Then, with that benefit that is where you use and you go and you used to get your freedom. But trading itself is not freedom. Trading well means being restricted. That is the truth that no other trading educator tells you. The more methodical, boring route your trading, the better you will do. So if your trading plan is good, it will change for you. It will handle the fluctuations in the market, it'll tell you what to do, it'll already be in the plan. If the market changes, something happens, the trading plan will be like, "Okay, if things go up, you do this things go down, you do this, if things go sideways, you do this. If volatility increases, you do this". That's the job of the trading plan. If you're making decisions on the fly, it means your trading plan is not complete. But you don't change the plan in the middle of a trade. Right? So that's it. Take the 66 trade challenge. And if you can make it through, your trading can be changed forever. If you don't, you just keep trying. You do it again, you do it again. And this doesn't have to be with real money. These are no I'm not talking about real money trades. I'm just talking about trading with a habit. Right? So if you want to put on paper trades, that's fine. As long as in your brain, you think this is real money? And you go through it exactly. No cutting corners, no forgetting about a trade No, none of that lack of discipline stuff, right? Follow the rules. That's it. And you don't have to do it for the rest of your life. You just have to do it for 66 trades until the habit is formed and it will be automatic, and you will automatically be doing it for the rest of you. But it will be subconscious, there won't be a problem, it won't be a pain, you just get used to it. Okay, so this is the solution to lack of discipline and the roller coaster syndrome. So now you know. Question is, what are you going to do with this knowledge?
What to Do When You Have Tried Everything and You Are Still Not Profitable Trading - 139
1:25:27Mark: Well, look, it's really it's a, it's a long journey. I've read your book, I've read many books, I've been in this game for a long time. It's very difficult to sum it up in literally minutes, I suppose. But after reading a book just recently, and listening to all your podcasts a lot lately, I've delved into a lot of it and taken many, many things out of each person's story, which I can resonate wholeheartedly with. But I probably got into Options back in 2006. And I've probably come and gone with it a lot. I've started and stopped, due to various reasons, obviously, life, I've got kids and family and work commitments and stuff like that. But it's always been, I suppose, a hobby. But trying to make that jump or trying to get into it. Full time is obviously difficult for lack of funds or lack of time and effort. I don't know, there's always seems to be something that comes up that stops me from progressing. Having said that, I'm a pretty committed person. I'm pretty disciplined. I've been doing it now for a long time. But like, if you look through him on the table here, I've got trading stuff sitting everywhere, notes. Mark: I've crunched the wheel so many times I've done the shiny diamond thing. I've gone from one program to another. I've spent numerous amounts of funds on various programs and different services such as yourself. I don't know this Option Genius has been around in my life, I suppose, on and off. So I don't know like I've all I'm a big advocate for what you say and what you do. I've wholeheartedly believe that I've been selling options for a long time I've done credit spreads, I've done strangles I've done butterflies, I've done covered calls, I've done a lot of those strategies, or centered around selling options. And I've been doing it for a long time. But for some reason, I just can't seem to break through the ceiling, I just cannot seem to be there to go from this hobby, like training interest that I seem to be involved with, to getting to that next level. I suppose I when I found out that we're going to do this call. Set last night I sat down I tried to write out things that would be good to discuss or to ask you. And I've got like all this paper sitting you have all these notes that I've made, as you would have seen in my email, it was quite lengthy. I think one of the assistants said all that email is probably the longest one I've ever received, that I really okay then. Allen: Like, you know, because we get, we get lots of emails every day and some people, right? Some people write two paragraphs, but when somebody goes in deep, and they really share their, you know, their soul pretty much. It's like, Hey, I've been doing this and this and this, and this, and I don't know what's going on, then, like we you can feel it when somebody is really, really wanting to make it work. And so those most of those get passed on to me. And when I read it, I was like, alright, you know, we need to we need to talk about this. Because if you've been doing this for years, then like, I have not doing my job. I've let you down in some way that because you know, you shouldn't still be feeling that way. I know. But it's not uncommon. You know, we come across many, many people that come to us and say, hey, you know, I've been doing this for a long time. But you know, it never clicked for me. But you will.. Mark: Yeah, I can see that. So many people that you talk to, you know, have the same they're trying and trying to trying to find the right system, the right setup the right, whatever it is just can't seem like I feel to break through that ceiling. Like you're stuck underneath the water. You're swimming hard. You're learning this, you're watching that you're reading this you're researching. You're looking at the charts to pair with analysis, paralysis, all that stuff. And I've made lots of trades. I've done lots of trading. I've been I've been I won't say successful because clearly we wouldn't be on this call otherwise, but I've made money, but I've also lost money. I've got scars, I've got all that stuff I've had I've had losses, but still here I am battling looking at all that stuff that you talked about in the book in that book really resonated with me there's a lot of stuff in there that I thought I can do this. I know I can do it. Why am I doing it? Why it's just what why does it elude me so much? Is it just a pipe dream and more and more just a duck on the water swimming and just never gonna get there? I don't know. Allen: So you know, when we when we got the email, when they forwarded to me, they asked me like, hey, what do you think the problem is here? Does he not know enough? And my answer to them was No, I think he knows too much. He knows too much. That's part of the problem. I'm just guessing here and I wanted to try to get to the root of it. But you know a lot of the times when so there's there's different things that you need. Everybody needs different things to in order to succeed in anything. Obviously, you know, you need to know what to do you need to how to do it. You know, you have to practice you have to put in the time. You need somebody Do that can actually has doing it like coach that's teaching you, you need a team or a teammate or somebody to do it with. These are all different things that that can help. But a lot of times we come across people that have been, you know, bouncing around from program to program, like you said, they know all the different strategies, they know everything, they know how it works. Some people come and they know it better than I do. You know, so they're, they're telling me that, oh, the Vega this is this and the Gamma and the theta and the row and all this other, you know, they're touching on the Greeks, and they're managing by the Greeks, and they're doing all these complicated stuff. But they're like, it's still not working, why is it not working? So I think, if it can work for somebody else, it can work for you. And I firmly believe that in just about anything, except maybe sports, you know, should somebody else could dunk the ball, maybe I can't dunk the ball. But in trading, a lot of it is I think, 80 to 90% of it is menta. Mark: I've totally, totally, totally. Allen: So there might be something that is holding you back, or, you know, maybe like I don't know, so let's get into it. So now you've mentioned a couple of times that you haven't gotten to the next level. So tell me what is the next level? What is the goal that you're trying to get to? Mark: Well, I think the goal is the same for everybody's, you know, everyone's trying to make income, like, right, I have a I mean, I'm in I'm a cop. So I work in a profession that I see myself coming to a fork in the road. I've been doing this job now for over 14 years, for 10 years. And before that I was in a private industry, we had a family business. So I understand all the dynamics of running a business, how it operates. We had a family business for over 30 years. And long story short, we got out of that for various reasons. And then I got into the government sector, which is a totally different psyche altogether, which took me some time to try and come to terms with. Having said that, I've forever in my wife, and I've come from a family that has been heavily invested in property, shares, businesses, and stuff like that. So I've always had this belief that I can do something with my life that will be able to produce constant income money have investments, like I've had investment properties, and I've done the share thing now on the option things for a long time. And I'm not destitute, I'm not desperate, I have a house, I have three beautiful children and family sort of stuff. But I want to go to the next level I want to be able to provide, I want to be able to teach my kids trading, I want to be able to show them how to invest all the money stuff, like all that sort of thing. I feel as if I'm promoting this stuff, yet, I haven't really truly succeeded myself. I haven't got to the level where they can say okay, Mark, look at you've got all this great stuff, and that show me how to do it. And when they do ask me, I'm sort of thinking so I will not really, I can talk about it. I've read about it, and I'm doing it, but I really haven't got what you think I have. Having said that. Getting back to the trading side of it. I think I want to have this as a business, I can see the potential in it as you can do from home. It's all in front of you in the net. I don't have to go out I don't have to be injured tree. I understand that. I do know a lot about it. I understand all those things you just mentioned with the Greeks and what not right? And I probably do, I probably do know too much. And I do want to keep it simple. I do say to myself, when I'm doing it, just keep it simple. Why do you need to have this indicator? Why do we need to be having that? I totally agree with what you've promoted and talked about for so long. And I think I was probably watching on Option Genius probably before you even started doing podcasts. But over the years, I've come and gone. I've been involved with and I've been with other things. And I've on and off as we mentioned before, right? All right. Does that help answer the question? Allen: No. So what what what do you mean by the next level? Is it an income? Is it is it a certain amount of money in the account is a certain amount of money every month? Where it is it that you say okay, now I've arrived now I have achieved my goal? What what is that number so that you would be able to be like, Yes, I feel happy though. Mark: Okay, so I've sort of thought about that. And I've put a number down to 10k. Now that's a pie in the sky dream. That's a pie in the sky dream. I know. And that's a long way off being achieved. I would just like to be able to see some consistency, all that stuff that you promote consistent, being profitable, and I can do that. But then as you know, you get one or two trades that wipe you out, wipe it back to zero and then it got to start again. Right? So just not we're just not getting that constant. Right? What do they call it.. Allen: Okay, so 10k is the goal. Now, it's not a it's not a it's not a pipe dream. It's so 10k is the goal. If you got 10k every month, you'd be happy. You'd be like okay, I've made it you know I'm accomplishing And that this stuff is actually working. Finally, this stuff is actually working if you were making 10k a month. So tell me, what is it that you think is keeping you from doing that? Mark: Well, clearly a lack of funds at this stage. But I have had numerous accounts where they've had a substantial amount of money in there, but I've just brought it right back down to just doing one lots, until I can see the consistency and seeing that, the, that my trading works, it's consistent, well, then we can scale up. So I'd rather than that, so I'm happy to do just one month a month, which means I'm not gonna make 10 grand in the near future, right, those types of trades, but we can scale that up at a later date. Allen: But what do you so if you were to say, hey, Alan, give me this one thing, and I know I can make tons of money. What is that one thing? Mark: Well, I suppose it's like a business plan, isn't it, like a franchise to follow a step by step thing, do this, do this, do this, do that put it on, obviously, there's a little bit of, there's gonna have to be a little bit of a thought process and feel for the market. But I suppose I need a plan. Like I know how to put the trade on, I know how to do a credit spin on it, for example, but I suppose I need a set of rules or business plan or like something to follow. So that way, I can just follow the recipe for a particular day, not particular strategy, but it's very hard to identify it or pinpoint it down to one thing. Like I've written all these notes in the book and pages and pages of all these things that you're discussing the iPad and whatnot, and try to answer those questions myself. Like, what am I looking for? What's stopping me I've written here a recipe, a plan, a template to follow rules to follow or to abide by tools, treat it like a franchise, for instance. So that way, I'm not deviating to another thing. So I have it on my wall and write down Am I following those particular plans? Does that is that sort of answer the question? Allen: So do you not have any trading plans right now? I mean, you said you were in different programs and everything so did you do you have any that you've been using as a guideline as a framework? Mark: The cover I've written things down in the past but I suppose sticking to it, or having it visible is difficult. I suppose someone to write one with me or for me to say right this is a trading plan. This is what you need to have in it to follow I suppose I haven't really been given a choice like if it says write a trading plan, write down this stuff, write it down, but I suppose I just want to try it like this is what's going on my head just put the trades on just put the trades on work with the probabilities. Yeah, it should work out. Allen: Okay, and are you conservative or aggressive? Mark: I believe I'm conservative in the sense where at the moment like with the one loss, so like, if I was aggressive, I'd be going right I'm pretty positive this trades gonna work of two or five, or 10 lot but at the moment, it's like let's just hold back and do one more being conservative. I think I can be aggressive if I need to be but on how Allen: And how much percentage return are you looking to make? Mark: I knew you're gonna ask me that question. And I don't actually have a percentage. I've just I suppose a bad way of saying it but I just keep putting the trades on and hope that the probabilities work out so I don't have a particular percentage amount that I've got Okay. When you ask that question Allen: obviously so obviously you know, just putting the trades on hoping they work out that's not working. So we're gonna have we're have to refine this What strategy do you think most appeals to you? Mark: Well, obviously I've been working on the credit spread that's probably the one thing that I've done the most of the credit spreads like I've done in many others, but that's the one that I've probably done the most so in the last few years. Allen: Okay, and are you keeping track record of all the trades that you've been doing? Mark: No, I don't. I have written them down in the past. I do try to follow that put it in a journal, but over time, it just becomes cumbersome I suppose like it's writing it all down. I don't I don't stick to it. It's probably the kind of problem there. Allen: So what you said is you want to franchise, and in the franchise are going to tell you the first thing is to document everything you're doing. Because we cannot tell what's going wrong if we don't know what you already did. So having a firm plan that says okay, I'm gonna put this trade on and writing down why, why am I putting this trade on? Because it's moving higher because it's got news coming out because it's high. It's, you know, very volatile right now or the IV is off or whatever their reasoning is, you put the rig, you put it there, you write the trade, you record what happened, why or why did not work out. And then after you do a whole bunch of these, you can go back and look at it and say, okay, every time I do a trade that's at, you know, 35 Delta, it works wonderfully. But every time I do any other Delta, it doesn't work. So I'm just going to do that 35 delta. So if you want to find your own trading plan, then this is how you do it. Now, this is a long way to do it, it's going to take a long time, because you're going to have to test different things and try different things and see what's working, what's not working. But it would be one way for you to create your own plan based on what you find you're more comfortable in, because some people they come in and they tell me, hey, you know what I want to do Credit spreads, and I want to do 2025 Delta spreads, some people don't want to do five Delta spreads, you know, so everybody's comfortable with different things. And then based on the amount of credit they get, then we can figure out okay, how do we how do we manage the trade, some people should be not managing the trade at all, they should just be getting in and getting out at a certain amount. Some people, they can go ahead and say, hey, my trade is going bad, I'm going to, you know, adjust it or do something else with it. So depending on what we're thinking, when we get in will dictate what we do when we're in the trade. Mark: So now that I know what I do for trades, there are particular entry signals that I looked for, like I don't just go and find a stock and then look up a chain and then play delta and put it on. I do have, like, for example, I think there's market volume, I use volume. So obviously, when volume is increasing, I'll have them put on a put trade, obviously, when the stocks turning or progressing. And obviously over the three averages, like you say, things like that. So there are particular indicators, and not too many I do try and keep it fairly simple, I believe, before I put anything on, so I do try and put the weight in my favor. And the advocate of that, of course, by using those some small indicators to try and get it on sideways or progressing in the in the direction that we think it's going. So I do look at that I'm not a big person, I'm gonna use a 35, Delta, or 45, or whatever. Right? Okay, I understand the Delta side of things. But it's more about volume, I suppose at this stage and what. Allen: Okay, so that that's good to know. Right? So I mean, what I would do is, I probably have a sheet, kind of like a checklist, you know, so get it out of your head, and onto an actual piece of paper, where every single trade you have to mark it off, you know, the volume is high, yes, you know, movement is this way or whatever, whatever your your things are, you check it off. One, two, three.. Mark: I actually have done that I can attest that I have done that I've written down, like when the bar gets lower than the level of bar, it's time to get in or when a turn when it points up. It's getting. So I have written most things down in the past. Yes. Allen: So that'll be your trade law right there. That's if you do if you have the discipline to do that, before you put in the trade, you'll you'll know at the end, okay. You know, just go back to that journal and be like, Okay, what worked and what didn't work? What are the patterns. And that's kind of the stuff that I was doing originally, when I was first starting to figure this stuff out, is look at every single one. And now I have my my checklist, where if there are two or three things that I cannot mark off, I don't put the trade on, because I know that hey, there's not enough, you know, these things are really important. I want them, I don't want to put a trade on without everything checked off. Allen: Now, that doesn't mean that I'm not going to lose, like you still lose on the trade with everything checked off. But like you said, you know, we're putting the odds in our favor. As many times if you have a checklist, like you said you did. That's your journal right there. And so before you put on the trade, you just mark it off, you know, check, check, check, check, oh, I can't check this one. Then later on, after the trades are done, you do 2030 trades, at least, then you can go back and look at and say okay, I lost on these three trades. What is the pattern I lost on these five trades? What is the pattern? And you might find a pattern, you don't have to but you might find something that say okay, these indicators, you know, they're not working or they are working. The other thing is, I mean, it's, it's really simple, right? You find the strategy that you want. And you said, Hey, I found the strategy. Second step is to find the trading plan, that you think you think will work and then is just test it and trade it and do it over and over over again. But the important part is that you have to stick to the plan. Do you think you stick to the plan, or is it? Is it a discipline? Mark: Tell me, tell me, what got you out? I've read your book or listen to your story. What part got you through that ceiling? Obviously, we're doing the same thing as we all do for such a long period of time. But there must have been something that clicked or something that you did or something did you get into? Was it a program for you? Was it someone that you got? Hold on What, what got you to that next level that we all tried to get to? Allen: It took time, it took discipline, there were a few things that really helped me. One was really sticking to the rules that I had set up. And really, it's about, you know, when it comes down to it, it's about putting the trades on with the odds in your favor as many ways as you can. And I learned about that later on, you know, having different different levels. But what I started to do, and the ones that I really started doing well on, and in the beginning, were iron condors. For some reason, that strategy really, really clicked with me. And I was like, Oh, my God, I gotta work. No, no, it doesn't work right now. But he's like, you know, that strategy really worked. And it was like, Oh, I can adjust it. So I might never lose money in the trades. It's just really awesome. But I still was having trouble following the rules. Because, you know, you have to work that. So there were there were a few ways. Number one is my wife got involved. Allen: So every day, she would, like I would have a list of all of my trades, and I would have all the rules, like when I needed to do what, so every day at a certain time, she would come upstairs because I was working from home and she wasn't she wasn't working. So she would come upstairs. And she would ask me, Okay, let's go through every single trade one by one by one. And so she'd be she'd have her notes. And she's, okay, this trade on Russell. Where is it now? And they go, Okay, this, it's up this much money, or it's down this much money? Okay. When are you going to adjust? Well, when this happens? And they said, where is it now? Say, Oh, it's right here. So do you have to adjust it? No, not yet. Okay, cool. Next one. All right. I did this. Okay. Why did you do this trade? And when are you going to adjust it? Should you have adjusted it? Yeah, I should have adjusted already. Why didn't you adjust it? Ah, I don't know. She's like, Oh, what the hell are you doing? Mark: All that is basically you got your wife involved? Allen: I mean, not just involved, but she was holding me accountable. So I had to answer because she doesn't need to know anything about trading. But she just needs to look at my rules and ask me the questions like, hey, what's the trade doing? Is it up or down? Why have you not? What are you going to do about it? And if there is something to do about it, what are you going to do? So it's just asking yourself those questions every single day. And it helped. I used to do that on my own. But I would always ignore the answers. Because I didn't have anybody to answer to. It's like, oh, I'm a trader, I'm the boss, I make my I'll make the decisions. But when she came in, I knew I had to answer to her. And if I don't have a good reason, then I'm putting her money on the line as well. Right? I'm putting her future on the line as well. So we would have a discussion about that. So I knew in advance, I knew, Okay, she's coming at one o'clock, I need to make sure I got everything right. I'm doing everything right. Otherwise, we're gonna have an argument. And so I needed her. Like, in the beginning, I wasn't, I was I lost a lot of money. And so the only reason that I didn't have to go out and get a job was because she was patient with me. But it was part of it was like, she's going to be the boss, right? Until I turn it around. And until I break the ceiling, she's the boss. She's going to tell me what I can do what I cannot do based on how I'm doing. And so I call that my one o'clock, you know, fire drill. It's like every day at one o'clock, I still do it. I go through every single trade and I look at it and say okay, is this trade up or down? It's up. Okay, good. Allen: What happens if it goes down a little bit? Am I still going to be okay? Yes. Okay, move on to the next one. And so I don't have time to do that on 100 trades. So that's why I limit the number of trades I have. But every day I go in and I look at it and I monitor it I know where each trade stands. So that before it starts to get into trouble, I know and I can look at it and be like okay, this one I need to monitor this one I need to adjust early or this one I need to maybe just exit it because it's not acting right. It's not acting properly. So It kind of gives me you know, so having that while you go in every day and look at each trade, and everybody does that. But in order to you ask yourself the right questions, and then you have to do what you need to do. So just monitoring the trades, and just checking on them is not enough. You have to know, okay, this is my plan, and I have to do this, then you have to stick to it. And then if you have an accountability partner, or if you have a wife or a child, or whatever, if somebody comes in and asks you, hey, you were supposed to do this, well, why didn't you do it? And then you have to answer to them. So when you have somebody else there, that automatically, I mean, that instantly made me better, like instantly, the first day, second day she came in, you know, I just I just started following the rules, because I knew I had to, I had to give her an answer. So that was one of the things that did it. Allen: The other thing was that I realized that this is a long term game. And so you've read the passive Trading Book. So I wrote that book, because I saw that if you're only selling options, eventually, you don't like the options can go against you. So what I mean by that is, in the financial crisis, when we had the financial crisis in 2008, there was everything was just going up and down. And so if I had options on if I trades on those trades lost, and then I could never get that money back. That's when I realized that, okay, you know, if I want to play the long game, if I want to be in this forever, I cannot let something else knock me out. I cannot let a COVID 19 pandemic knock me out, I can't let the financial crisis I can't let you know, the President making some decision and sending the stocks down, knocked me out. And so I started building up the foundation of stocks, and using those to generate capital on those. And the idea is, hey, I want to own the stocks as my foundation. But I want to use options as basically like a rocket ship, you know, so I wanted to boost the returns. So I'm gonna have conservative stuff in the in the main portfolio, you know, where I have the stocks, and I'm making money. Mark: I totally agree with all right. Yeah. Allen: So, you know, that was now Mark: I totally agree with all that, definitely. Allen: So you can't start off that way. Because it takes a lot of money to own that stocks. So in the beginning, you do have to get good at picking one strategy, getting good at it, just following it and being disciplined, and saying, Hey, I'm going to do this, and I'm going to follow it along. Now, again, long term, picture wise, every month, you're not going to make money, every trade is not going to make money. So you have to have that in your in your mindset that, hey, sometimes it's gonna work, and sometimes it's not. So there's lots of lots of little little things that you can improve on it. But the biggest thing that I'm seeing is that you have to follow the plan. Mark: So Allen, do you think that I would benefit? Like I know you're selling plenty of courses, promote what you promote in the book. And I totally agree with all that, I get it on one side. But if I was to do another course, such as yours, I my fear is, and we're just going down that same rabbit holes, as I've done before, hence why I'm confused as to why I can't seem to break that ceiling. If I was to go into a course such as yours, this one that you're the passive trading and whatnot, I worry that I really fear that a year I am going into it again, I'm doing another course. But I understand the strategy. I think now I need more of a coach, maybe I need maybe that one on one, maybe maybe that's what I need. Or maybe there are things that I'm not happy to admit to that I do that I need to be changed. I need to be molded stead of going down this direction on to be heading over in this little bit direction over here with my trading. I understand the why thing. That's a great thing in my voice. She's a great supporter of me. I am trying to I'm trying to get out of work. She works. I'm trying to get her out, keep trying and trying and time is your course gonna sit me on that path to freedom. Allen: So it's like, you know, I mean, I'll give you an example. Like when people go to college, right? They everybody's told go to college, go to college, some people they go to college, and they just they just party the whole time and they don't get anything out of it. Some people go and they study, study, study, study, study, and they get a good job. Some people go and they make lots of contacts, you know, they they meet, they make lots of friends. They meet lots of teachers so that when they get out, they know a lot of people and they have a good network and then that helps them so it's really up to each person individually. Now I would love to say that yes, every single person that takes my course makes them million dollars. But that's not the reality. You know, people come in, life happens, they take it seriously, they don't take it seriously. And, you know, that's, that's one part I cannot control. So I cannot tell you that, yeah, you know what, it's going to work for you just because it's, I'm amazing. And I'm a wonderful person, and it's just gonna work. 90% of it is on you, I can give you everything I know, I can do it with you. But again, the markets have to cooperate. Number one, and then number two, it has to click for you, you have to do it, and you have to practice it. And you have to stick to the plan. A lot of times when people come into my programs, and they tell me Oh, hey, you know, I'm doing XYZ, I'm like, but that's not what I have in the plan. Allen: That's not what I have in the program. They're like, yeah, no, but I'm changing. I'm like, okay, but have you done it my way? No, not yet. But then why did you join my program, you could do your own way. Without my program, you don't need to pay for my program, right? If you're going to pay for something. And if you believe that, hey, yeah, this guy knows what he's talking about this thing works, I think it works. If you're going to pay for it, then just follow that step by step by step and don't change it. Unless it works. Allen: When it starts working, then only then would you say, Okay, now I'm going to, you know, change it up, because I think I can, I can be a little bit more aggressive, or, hey, I want to be a little bit more conservative, or I want to change it up a little bit. But you don't do that until it's always working. So the problem is that people that have been doing this for a long time, they know all the strategies, they've listened to many other coaches, you know, they come in, and they're like, Well, you know, I don't like that one thing, I'm going to change, I don't like that thing, I'm going to change. And so they start doing it their own way and they don't listen. And so you can't take stuff from this course and this course and this course and mash it into a Frankenstein, and then tell me "Oh, it didn't work?" Well, because I don't know why that guy told you to do that. And I don't know why that other guy told you to do that. Or the only thing I know is if you do it this way, you'll get the similar results that what I'm doing. Now, if you add and change it, then I can't help. So, you know, like you're saying that we have, I think there's like four pillars that I tell people that people need. So if you want to learn how to do something, you need these four pillars. Number one is you need the right strategy, which you've already said is, hey, that's the credit spread, right? Number two, you need the trading plan that works. So number three, is you need other people to do it with because you're doing it all alone, like you said, you know, you might need a wife, if you don't have a wife or partner like that, then you can have a community or other students that are doing it the same way. Allen: And then number four, you need a coach that can actually show you what he's doing, because he's still doing it. And he's actually doing it right now, instead of somebody that said, oh, yeah, I was a market maker 30 years ago, and I don't trade anymore. So I think those are the four things and depends on which everybody needs. So the coaching part is the one that takes the most time. And that's why those coaching programs are the most expensive. Allen: In my passive trading course. You know, we give you the trading plan. It's like okay, here, this is the plan, these are the rules, you follow it and, you know, good luck. But there's no one on one coaching. There's no group, you know, where we are, where we're doing and looking at the trades. And so when we have that passive trading course, it's a cheaper course. And so people would join it, and they would go through the modules. And some people would have a lot of success, some people wouldn't. So I said, What, what's the problem? Why are they not? Why is it not working? And I realized that it would help if they could just spend a lot more time with me. And so we created that credit spread mastery course, where every week, we get on the call, and we're just looking for trades, we're managing trades, we're adjusting trades, doing it together. So the point of that is, here's the rules. Here's the trading plan. Now let's do it together, over and over and over and over and over and over. And so once you have that habit of doing it the same way over and over and over the other, the other ideas, the other habits kind of die off. So I've seen that that program does deliver results. So we back it up and we say hey, look, if you're in our program, and the program doesn't work, like you don't if you're not profitable in our program, then we keep you in the program. We keep working with you. We keep you in the class until you become profitable. And so even if the markets not cooperating That's fine, we'll learn how to manage it together. And then we'll stay longer in the program, if you'd have to be.. Mark: So with your target trading alum, obviously, it does take a type of market. And obviously, that's why through the last six months with Covid whatnot, it would be easy Earth to do that type of training, because obviously, it just went straight up didn't keep they're still on put, credit spreads the load of was money for Jim, in a market such as what we're in now, which is up and down, up and down. It's far more difficult, isn't it? Allen: Currently it is more difficult, doesn't mean it's impossible. So we do have to dial back our, we have to dial back our expectations. So last year, the year before, you know, making 10% a month, 7-8% a month, not a big deal, it was pretty simple. You know, put the trades on most of them work out in anybody, and everybody was making money. Like any you know, you could buy anything, and it was going up any everyone is making money. This is a market where you have to be really good at selection, trade selection, and management. So you have to know when things are turning around, and when to get out before they get really bad. Allen: So the trade management, sticking to your stop loss is very important right now. And those are things that most people get afraid of, you know, so it's like, okay, I put the trade on, it should work. And then oh, no, the stocks turning around, what do I do what I do, and they don't do anything. So if your thing is part of, if you're doing as part of a group or in a program, then be like, hey, we need to get out, we need to get out, get out, get out. Some people let people know, Mark: There's that mental component, that's the biggest part. And as I've gone along this journey, if all these years, I've realized more so in the latest year, it's not about the strategy. It's not about all that stuff. That mental side of it, it's 80-20, Mark Douglas, the book, the trading zone, I listened to that over and over and over again, and various other podcasts and whatever other things, but trying to pull the trigger when you're in a loss is it wasn't so hard, we put this trade on, it was gonna work a met the probabilities, it was all looking good, it was under the over the top of the averages. I had volume, blah, blah. But all of a sudden, now I'm underwater again. And here we go again, and then I've got to pull a trigger to get out to take that loss. Mark: And I have taken some big losses in the past, I've had to pull the trigger, just recently with the weekly trading system. And when that I mean, there's Solomon says, I've been there for a couple of weeks, again, I've been on and off over the over many years. And all of a sudden, now I'm having to pull the trigger again to get out because we lose money. Like it's hard. It's another scar, isn't it another scar, not a scar, it's another get back down there. You know, I don't want to see you do any good. It's difficult, you know, and that's that mental side of it is arguments or trading? Allen: Yep. The emotions, you know, the emotions have to be kept in check. So there's different ways that you could do that, you know, one, one of the ways is people say that you divorce or divorce yourself from the outcome. So whether you win or lose, doesn't matter make a Mark: ..difference? Exactly what I totally agree with that. And that skill is very difficult. Allen: Yeah, your job is to just follow the plan and stick to the plan. And if you can do that, eventually, over the long run, it'll work out, you know, maybe you have losing trades, that's fine. But over the long run, it should work out. So too much of it, like you said, you know, like, oh my god, I'm, I'm going to be negative again, oh, my God, I'm gonna have to pull the trigger. And oh, my God, you know, when you have that kind of reaction, that compounds and it just makes it all, it makes it much harder to get out of the trade when there is a loss. The other there's one lady, she told me something that really worked for her. She goes, You know what, this is not my money. This is God's money. And what what are you talking about as God's money? She goes, Well, I use this money. And I use the gains from the money to do good. Because they use it for charity work. So she's like, I don't need the money to live. Because I have enough income I have enough. You know, I have I have money coming in that I live off of. But this is my trading money. And so I take the money that I make, and I give it away to charity, and I do good things with it. So it's really God's money, and I cannot lose God's money. There's no way I can lose money. And so if I'm if I'm going negative, that the trade is losing, I get out right away because I don't want God mad at me because it's not my money. So that's another way you could look at it. That you know, again, it's it's taking yourself out of the outcome, you know, and it's not like okay, it's not under my control. So you've got the wife coming in and asking you what you're doing and why it's working or why it's not working and being accountable. You have you know, not looking at the outcome just getting better as a trader, just hey, I need to do my skills, whether it wins or not, that's not up to me. That's up to the market, I can't control that. But I can follow my plan. That's up to me. The other thing is, you know, not looking at it in emotional point of view, like, Hey, this is not my, maybe this is my kid's mind. Maybe this is, you know, God's money, however you want to look at it, but it's not yours. So if you lose it, it's bad. Like, that's the worst thing to happen. You know. So there's, there's three different ways that you can mentally overcome the different obstacles. But again, I think one thing that we haven't talked about yet is to simplify, right? So you've done all the different strategies, and I'm sure, you know, some of it is creeping in. And, you know, it's like, oh, you know, I got to do this, or I'm going to, I'm going to wait for this indicator, or I'm going to wait for these Bollinger Bands, or the Fibonacci, or the technicals, or any of that stuff, the more you simplify it, the easier it becomes to actually follow through with it. And so I think, you know, just one strategy, not chasing after the shiny object, you know, it's like, Hey, make a decision. If it's spread, spreads, and that's the only thing you focus on, and you get rid of everything else, you stopped listening to everything else, you unsubscribe from all the emails, you know, whatever, whatever service that you choose, like, Hey, I'm going to, I'm going to follow this plan, I'm going to, you know, if you've taken a course, maybe you've already taken a course, you have a course that you've tak`en and be like, Okay, I like this course, I'm going to follow this course, we'll get rid of everything else. Just go through it. Master that and don't do anything else until you know what that is, until you get the results that you're supposed to get it. In the beginning, when I started screwing up, like I would learn something, and then I would do good for a little bit and then I would mess up. And then I would do good, then I would mess up. So I was like, What the hell do I do? Well, I would always go back to the basics. I would imagine that I don't know anything. And I would go back to step one. Okay. What is a call? What is the put? What am I doing here? What is the strategy? How am I supposed to put it on? What are the rules and I gotta follow them step by step by step, not like, oh, you know, I'm gonna, I think this stock is gonna go down or or, you know, there's a Fibonacci retracement level, and there's some support here. So I don't have to adjust. No, forget all that stuff. I don't know any of that stuff. All I know, is the strategy and my trading plan. And that's it. And so that was, you know, you go back to the basics. And that will change your mentality of it, like, Okay, how do I manage the trade? How do I deal with this? Allen: Again, if there's other things involved, like stress, you know, if you're under a lot of stress, you're going to make the wrong decisions. If it has to work. If I have to make money this month, from my trades, you're going to make the wrong decisions. It's not going to work out in the long term. So there was a there was something another trick that one of our one of our students taught me. And now everybody can't do this. Most people can't do this. But what he does, is that he takes whatever money he makes trading this year. He will live off that next year. So when he's trading next year, he doesn't have to live off that money. Because he already has the money set aside from the last year. If that makes sense. Mark: You need a big bankroll sounds like a real estate agent. Allen: Yeah, you need Yeah, he was. Yeah, he was. He was a politician. But, um, he has obviously, other people's money then. So I mean, he did have, you know, he had, he had a large account to do that. But eventually, that would be the best thing to do. You know, you have you already know your expenses are covered. Right? Now, you're only focusing on the plan and focusing on on just winning and just trading properly. It's not it takes the emotion out of so whatever you can do, whatever trick you can use to get that emotion out of it, that will make you a better trader. One, one more thing that that that that I've seen is happening to me is, the more you do it, the more of a habit it becomes. So if you do, you know, 50 trades, that's a lot better than five trades, but 500 trades is a lot better than 50 trips, if you do them properly with the right practice. So eventually, you get to the point where Oh, it's just another trade. It's not a big deal. It's just another trade. There's another one coming. So if I get if I hit my stop loss, yeah, it hurts. I hate it. But it's Just another trait, you know, I'm going to move on, move on to the next one, move on to the next one, because every month is a different ballgame. So you start over, you get to start over again and again and again. And so that is another trick that you would help in the long run. But again, you know, you have to, in before all of that happens, you have to have the confidence that this actually works. Mark: So what do I truly do believe in? Allen: Yes, you say that you say that. But then you also say that, you know, I can't do it. It's not working. It's not working. But you, you you've heard it that it works, you want to believe that it works. But I don't think you have that conviction yet that it works. And so the only way to get that conviction is to get it done for yourself. Right? And so it might be that you take a maybe you take a step back, and you go even simpler. And you say you don't want not the credit spreads, how about I do something like maybe a naked put, right, in a naked put, I'm going to make money if the stock doesn't go down. And it'll expire. And then I'll sell another one. And I'll sell another one. And I'm going to sell it far out of the money. So that I just when I just make that 20 bucks, or that $30 or whatever it is that small amount I'm just going to make month after month after month trade after trade I'm going to make and if the stock drops, okay, no fine, I can buy the stock, no big deal, I'll buy the stock. And then I'll sell covered calls on that stock. And so the covered call will expire, and I'll make something the covered call was expired, the next month will expire, and I'll make something so you build up that confidence that you know what, there is a way to do this. That's another option, you know, if you want to go that route, so you really got to figure out like, okay, you know, it's a, it's a personal thing, I wish I could just tell you that, hey, this is the one thing you need to do. But for everybody, it's different. And unless I spent a lot more time with you, unless I see all of your trades, unless I see you know, your emotion, how you handle the emotions, I won't be able to tell you. So that's kind of like in our in our program, what we do is we tell we give everybody a spreadsheet, and we say, hey, look, you have to fill out the spreadsheet, you have to put every single trade on the spreadsheet. And then they shared with me so that I can go in and I can look at them. You know, I could look at the tray. And I'll go in I'll see like, why did he do this trade? This doesn't make any sense to me. And I'm calling this Hey, John, why did you do this tray? Allen: And he goes, well, no, that's not gonna work. And he goes, okay, okay, fine, I'll do it. All right, done. You know, and if they're doing all the trades, right, then it's probably working. And most of the time, it's not working, like if they're not making money, then we can identify, Okay, what are what is not going right? You know, there was one of our current students, he was doing several trades, and he was still negative. So I looked at his spreadsheet, and I'm like, Okay, what's going on? What do I see, and his trade entries were great. You know, he was picking the right stocks, he was doing it properly. But whenever he lost, he would lose a lot more than he should have. He just wasn't getting out early on time. And so that was the biggest thing is like, you're not getting out. This is it, you know, your losses are too big. Doesn't matter how many trades, you win, your losses are still too big, you're still going to be negative. And so we worked on that. And then over time, he got better at getting out earlier and earlier and earlier. But he had, you know, he had somebody to look at that and to point it out, and to hold him to it. So that eventually he did it over and over and over again. And then by the end of the class, he was positive. He was like, Yeah, I fixed it. Again, that's all you need to do. That was he needed that one thing, everything else is simple. The training plan I could give you, you know, you could go do it on your own. But the discipline part of it, that's sometimes where we need help from somebody else. And so whether you know, it might be a wife might be somebody else, it might be a trading partner, somebody you work with, it might be a coach. So I think that might be one thing that you could implement. Mark: So just quickly, what what's the key points in a trading plan make like entry criteria, stop losses or that sort of stuff. Is there anything else that I can many points or rules should be in a trading plan? Like what I try and put a trading plan together, that is doable and simple to follow. To look at rather a complicated bloody list of all this crap, what would be a good trading plan? Allen: So, you want it to be simple and easy to implement. But you don't want it to be too simple, where it's just broad, like anything can happen. So, you know, I've seen people that have a trading plan that says, I'm going to do an iron condor on this stock 45 days to expiration, I'm going to sell a 10 Delta calls and sending out the puts. And that's it. That's my whole plan, and I'm just gonna sit and let it expire. That's a trading plan. It's very simple, right? You know, what you're going to do you know, what you're going to how you're going to do it, you know, what you're going to trade it on. And you know, when. And so now that pretty good plan doesn't work. So whoever's listening don't don't do that one. We've back tested that, and it didn't work. But there are, there are times there are several months where it does work, just because it has, you know, 80% probability, but over time, it doesn't. So that's the basics, you got to know what you want to trade, you need to know the strategy, you got to know what you want to trade. And then you have to know what constitutes a good setup. So when it comes to credit spreads, you mentioned credit spreads. So I like to do that, depending on the size of the of the trade, if it's a you know, maybe a $5000 $10,000 trade, then I'll go into I can go into a stock, or I'll go into an index ETFs are good, too. But they're their strikes are a little bit smaller. So you got to do a lot more contracts. But if I can go into a stock that has, you know, five point spreads, and I do 10 of them. That's a $5,000 trade. That'll work. Allen: So you can, what do you want to trade? And then what's the proper setup? So for me, again, I like to keep it simple. So if I see a stock that's trending, as moving up, or moving down, then I'm happy to trade it. Because I'm, I'm more of a trend follower, you know, so there's people that think, okay, if the stock is gonna go up, it's going up, it's going to keep going up until something big changes, there are other people that think the opposite. They're like, Oh, if it's going up, they just kind of come back down, because it's gonna do reversion to the mean. And sometimes that works. And sometimes it doesn't. So I don't really buy that I just like, hey, if it's going up, then it's telling me that it wants to go higher. So that's basically what I'm looking for. In a setup, I'm looking for the stock to tell me what it wants to do. So if I see a stock that's jumping up and down, no, I don't know what it's doing. I don't know what it's telling me, I can't understand the language, I'm not going to trade it. If it's going up, then I'm going to play it bullish. If it's going down, I'm going to play bearish. And sometimes, you know, it turns around and you get banked, but most of the time it's going to work out. So that's the kind of setup I'm looking for. And then over the years, you know, we've added other things to look at, you know, how do you make sure that all of your trades are not in the same sector? Right now, you know, right now, oil has been doing well. So all of the oil companies were doing great. But then they all turned around and went down all together. So if you have 10 trades on in different oil companies, that's not that's not diversification. That's the same trade. And so if they turn around, I'm going to turn on together. So that would be one way of putting the odds in your favor by having you know, only a small portion of your account in one sector. So you have to separate that. How do you diversify by time? You know, so not putting all your trades on on the same day. That's another way to do it. So you diversify by time. So there's so many different ways that you can do it, some of them might make sense to you some might not. And then, you know, we have other students that come in and say, Well, I do it, you know, I look for this also in my trade, like, Okay, if that's what you want to add to it, then add it. Don't subtract things that I've given you. But if you want to add to it, one student said that he likes to look at the weekly chart, I usually look at the daily chart, see how the stock is doing. He likes to look at the weekly chart as well. Allen: So I'm like, Okay, fine, you can add to it, you know, if it doesn't hit your criteria on the weekly chart, then just means you'll have less trades that qualify, but it's not gonna it's not going to put you into a trade that's going to hurt. So when you're basically you just have to figure out what you think is going to work. And then you have to test it. So back testing, and paper trading are really really, really helpful. Especially back tests, Mark: I find paper trading useless. To be honest. You lose interest very quickly. It's very easy to lose in that type of trading. Yeah, go ahead. I've done a little bit of paper trading and I've just found that I find okay, it's gone the wrong way. But I got it wrong. You just let it go. Because it doesn't mean anything. It has no significance, does it? Start with money trading? Yeah. You've got a connection heavenly with the with the live trading, because actually, it's not your money tied to it. Allen: It's not your money. It doesn't matter what the style of the trade does, you're only focusing on becoming a better trader, the goal is not to make more money, the goal is to become a better trader. Right? It's kind of like playing poker. It's like when you when people go to play poker, right? They'll professionals, they'll tell you that if they play their hand perfectly, and they lose, they're okay with it. Right? If they play, if they mess up, and they still win, they're still mad at themselves. Because I didn't play it right. I didn't play my cards, right? Even though I won, I don't care, because long run, it's going to hurt them. If they keep playing incorrectly in the long term, it's going to hurt them. So that's the goal to become the better trader. And the end results, the profits will take care of themselves. So paper trading is practice. That's all it is. Right? If you didn't need to take that on board. It's slow practice. Back testing, I prefer back testing way better than paper trading. Because you can go really quick. You know, if you if you come up with a plan, like okay, these are my criteria, I got these seven criteria on my trading plan. I'm going to enter when I see this, this and this. I'm going to exit when this happens. I'm going to adjust it this way If this happens, okay, I got that right and down, and that you can even just come up with your you can just guess No, I think this one's good. This one's good. That's my plan. Okay. You pick. You pick a stock, spy. Great, perfect. You go back to yours in time. January 1, put the trade on. How does it do? Oh, it made money. Awesome. Cool. February, how do you do made money? Great. March. Oh, we lost a lot of money. Doing it, huh? Okay. APR, how do you do? And then just do it month by month, I want back testing one month or one trade, you know, might take you five or 10 minutes. And so you can get years worth of practice in just a few days by back testing. And you'll find that Mark: It's something that I've never done is back testing. Is there a particular software that's adequate for that sort of stuff? I've never really looked down that line. I've heard about it. I've listened to it, but I've never actually really done it myself. Is there anyone ticular that would be worthy. Allen: The one that I use, the one that I use is called the option net explore. option that explore? Yeah, and I think I think they're based out of Great Britain. And so basically, it's, it's an options selling platform, you know, so it looks like your broker's platform, you put the trade on, and you go through it day by day by day. And it doesn't do it all for you, you actually have to look at it every single day. And if you want to make changes, you can make changes to it. That's what I like about it. There are other software's that you just put in the strategy, you press a button and it'll tell you "Oh, you made money or you lost money". That's not the point. We want to get better as a trader. Right. And so this one is like, Okay, I put the trade on, click a button. Oh, stock is down today. Do I need to do anything? No. Okay, next stage. Oh, stock is back up again. I don't have to do anything. Next stage. Oh, stock is down again. Oh, no, I'm at an adjustment point. Okay, what adjustment am I going to make? I'm going to do this adjust. Okay, cool. Let's see, did it work out? Go there forward today forward a day forward a day. Oh, expiration day stop. It worked. So it's, it's just, you know, there's no money, right? It's just about becoming a better trader. It's just about getting the practice doing it over and over and over again. So that I think would definitely help you as well. Mark: Okay, so one of the things obviously, we talked about discipline and the mental game, what's probably the best thing to follow, or to train your mental strength, like, as you said, like a paper trade or a live trade, you should be able to make that same decision, then in there without any emotional war. What's the best way to get to that level of trading where you whether you win or lose, it's just business as usual? Allen: Yeah, I've done to you have to divorce yourself from the outcome, whatever, whatever that takes for you. For me, in the beginning, it was getting my wife because I knew how I would have to answer to her. Mark: And scary Allen: I didn't have it. Exactly. It has to be scary. Because if you do it properly, she cannot get managed. Right? It's like, Hey, I followed the rules, babe. I did everything I was supposed to do. It still didn't work out and she'll be like, Okay, fine. That's no problem. But if you do not follow the rules, that's when she gets manage. And that's when it gets scary. So yes, you have to make it scary for you not to follow your rules, because a lot of us a lot of US traders, like, if we lose money, yeah, we don't we get mad about it, we're like, oh, man, I lost money, we feel bad about ourselves. But it doesn't hurt enough. You know, it's kind of like these people that say, Hey, I want to lose some weight. You know, so they make a goal, I'm gonna lose some weight, I'm gonna lose some weight, they tell everybody, and they do it for a few days, and then they give up. But then there's this website, that what, what this website, basically what it does is, you have to pick a, maybe a political party, or a person or some organization that you hate, you actually hate them. And you have to put up a lot of money and say, Okay, if I don't stick to my goal, this organization is going to get $5,000 or $10,000. So that makes you because it's now becomes a different level. It's not about just the money, or about doing the thing. It's like, okay, you know, let's say, for example, I don't want to give my money to anybody like the Save the whale Foundation, right? I don't want to, I don't want to give my money to the whales, I hate whales, I want them all to die. I don't want anybody to save the whales. So if I don't lose 10 pounds, they're gonna charge my credit card $5,000 and give it to the whales, and I hate whales. So I want to do whatever I have to do to lose that money to lose that weight. You know, because I don't want that well to be saved. You have to want something more than what you have. So there's, that's another psychological trick. No, in trading? We sometimes we get used to it, you know, it's like, oh, last? Oh, well, you know, we get used to it. And it just, we gotta it's just the mental part of it. Mark: Definitely, definitely, it's a huge part of it. Something I didn't I didn't realize, until much later down the track of trading, how big a part of mental side of it really is. Allen: I mean, if you find trying to avoid is difficult. Yeah. So if you find yourself having a problem with discipline, make it simpler, cut it down, make it as simple as possible. Find the trade that you know will like you know, the naked call or the naked put the covered call, these are very simple trades, they're really hard to mess it up. Right? On the naked put, if you get assigned the stock, hey, that's great. I just bought the stock much cheaper than it was before. And I'm going to own it. So you want to you want to do it on companies that you're going to own you want to own for a long period of time. That's the only way it really works. You can't you can't be selling naked puts on stocks that are just, you know, going crazy. That's the wrong way to do it. So you know, if you can simplify it, if you can find some way to have somebody else monitor you, and hold you to your fire, you know, hold your feet to the fire like, hey, you need to follow this, why aren't you doing this? Or, hey, it's not my money. Right? I'm doing it for somebody else. This is my kids inheritance, right? I cannot mess it up. So I have to follow the rules. One guy, when I was in, just after high school, I became an agent, a real estate agent. And as an agent, as a brand new agent, they tell you that you have to do a lot of things that you don't want to do. You have to talk to hundreds of people all the time, you have to cold call, people say Oh, Hi, are you doing? Do you want to sell your house? Oh, hi, do you wanna say, Well, you know, they have to keep doing things that you don't want to do. So it was like, okay, in the guy, the guy is like, hey, most of you guys are not going to do it. But if you want to be really, really, really motivated, what you need to do is go out and buy a fancy sports car. Sounds like what you're talking about, what do you do a fancy sports car? Because yeah, you need to go out and buy an expensive sports car so that you have that payment that you have to make at the end of the month. And so that is going to make you work your butt off because you have to make the payment. And as I go I mean, I understand what he was saying. I was like, No, I'm not doing that. But then eventually I didn't make it as a realtor. Maybe if I did do that, maybe I just didn't do the work that he told you to do. I just didn't do it. It wasn't the reward wasn't worth it for me. Mark: It was up to risk, I suppose. Yeah, Allen: I mean, you know, so with your training, you got to figure it out. Is it really worth it? Is the goal that hey, I want to quit my job. Is it I want my wife to quit her job. I want the kids to have this vacation or whatever it is. You have to burning. Yes, just eat you up every single day. You have to really really, really want it Mark: Explain to me how and it's burning me. Allen: Then the discipline has to stick. Because if you want it, but you're not disciplined, and your losses are too big, then it's it's not there yet. So I think, you know, if you don't have a trading plan, I'll just give you the training. You know, I mean, it's not that hard. It's not it's, it's the training plan helps. But it's up here. And it's the practice just doing it over and over and over again and having confidence in the plan. Because then if you have confidence, you'll stick to it. If you don't have confidence, you're going to change it, you're going to you're going to add things to it, you're not going to follow it, you're going to forget about it. Like with the paper trading, that's exactly what that is, you know, so it's not real. So, oh, well, I'm gonna ignore it. I'm gonna forget about I'm gonna do that. Allen: That really resonated with me Allen's that that point, like, go back to the paper trading, treat it like it's somebody else's money, and then make it work. Don't look at it as just as being as a fake account, that doesn't matter. Allen: I mean, I wouldn't Yeah, I would prefer you do back testing, it'll be much faster. Mark: To look at that I'll get, I'll get onto that particular site that you've made. Yeah, Allen: That'll give you years of experience in just a few days. And so, to me, that's like the best way you can do it. But if you know, if somebody is listening to this, and they can't afford that software, paper trading is free. And you can do it. Just Just treat it seriously. Treat it like real, and just follow the plan. And you'll see, because if other people can do it, you can do it. I'm talking to you. You're a very smart man. You know, if you understand what a strangle is, and and all the other things you taught me, you know that you told me, Oh, you're doing this. And we're doing that. And if you understand that part, you can get this. It's nice. Not that much. Mark: I know I can do it. I know I can I honestly believe in my heart, that of all the work and the discipline. Part, probably not so much the discipline, I suppose. But the tenacity that I have. I know I can get there. My wife, she just can't understand why I'm not there yet. She says you've worked so hard at this for so long, why aren't we living a better life than what we are now? Not that we're destitute and desperate, we're not we're doing we're doing fine. We both work with secure all that stuff. But I want to take it to here. I don't want to be just going through life normal and just crunching the wheel everyday living in a rat race. I've done that I want to I can succeed. I know I can do it. I've just got to find a way through. It's why we're here, I suppose. Allen: Yeah, I hear you. I feel it. You know, I was I was in your shoes for a long, long time. But, you know, part of it is sometimes, and I don't like talking about this too much. But the whole nature of options trading it, there's a lot of money to be made by teaching people how to trade options. There's a lot of people out there that don't trade options that teach people how to trade options. And they have no clue what they're doing. They're putting out information. You know, we've had people that joined our program, and then took our stuff and start selling it. And they don't know they never used it. You know, they're just oh, I learned this. And I learned this and I'm going to start become a coach. But you don't do it yourself. Right. But somebody else listening to that guy doesn't know that he doesn't know how to do. And so it calls into question like, okay, all the stuff that you have been learning. I hope that it's been correct. But we don't know. So that's another thing. Like, if you feeling overwhelmed, if you are feeling like Man, I've learned so much. And I'm studying this guy, and I'm studying this podcast, and I'm listening to this, I'm listening to that. Sometimes what you need is just a vacation from all of it. Mark: I have done that over time. Now I had stopped that period of time where I felt like it's too much or I've had a few losses. And in some of this during that time it says walk away for a while, take a break. And and at periods I've gone No, no, I've got to keep that I've got to keep at it. I've got to keep moving forward. But then I've probably learned as time has progressed, that it maybe just walk away for a few weeks, even maybe a couple of months. Just go and do something else for a while. But I always gravitate back to it. I always keep coming back. Allen: You can come back, you can come back. But what I'm saying is that don't make it too complicated. If you're listening to too many people, if you're listening to too many voices, then it just becomes too overwhelming. And even listening to so many like success stories, you know, everybody has success stories. If you just listen to that and say oh my god, this guy's making this much money. This guy's making this much money. He's good. Why can't I do it? What the hell is wrong with me? Why am I you know, am I stupid? Or am I First or what? It's, you know, everybody has a different path. And so, you know, sometimes you just gotta stop listening. You know, no more marketing gimmicks, no more marketing emails, no more webinars, no more, none of that. Focus on that one thing that you decided to do, you know, pick that one strategy, it's like, I'm going to focus on this strategy, this the only thing I'm going to learn about this, the only thing I want to listen to, and you go back to the basics, you start from scratch, you keep a record of all of your trades, you figure out the pattern, what's going on, you learn it, and then you just go from there and build on that. And I think.. Mark: So what did that, that comes back to that trading plan doesn't have a number of headings in there? Why did you went up? What day did you enter? Where was your stop loss? Why did you not take it out? I suppose there is a number of things that can be headlined in your journal, then you would have to account for as the trade progresses through to the end. Allen: Yeah, I mean, we have a we have a presentation, a video that we show people. And basically, what I did was I took nine years of credit spread trades. And I put them, you know, like, these are all my real money trades, if I started with $100,000, and I put 20% into each one. So you know, 20,000 20,000 to five trades, right? Of all the trades that I did, I looked at I went back nine years, I looked at all the spreads that I did, if I had done that and put 20% into each trade. Now, every month, I didn't have five trades. So I didn't have all the money invested. If I started with 100,000, at the end of nine years, I had 1.1 million. So that tells me that, okay, you know what my trading plan kind of worked. Right? The trading plan worked, the strategy works, you gotta give it long enough. Some years were really good. Some years, we lost money. But over the long term, with real trades, I was able to make the work. And so you know, in terms, a lot of people say, oh, I need to learn adjustments. Okay, that's one way you can increase your odds. If you learn adjustments --true. But if you want to just go back to simplicity, just make it as simple as possible. Put the trade on, if you make 10%, you get out, you lose 25%, you get out. Now, you know, I mean, I could teach you a hundred other things to add on to that. But if you want the simple, the simplest way to do it, find a credit spread that works that looks good to you. Try to make 10% temporary, you make 10%, you get out, you don't get greedy and try for 15 or 20, or whatever, you make the 10 you get out you make 25 or you lose the 25% you get out you don't you never lose more than two and a half times what you could make. And that was that's your plan right there. That would work. That's what I was doing before. So you know, I got a history Hey, yo, a real money. This is not back testing. Just this is real trades. It works. So, you know, the problem is, we don't always stop when it's down 25% We don't always stop when it's up 10%. You know, there's been many times when I started when I was when I was getting started. I was up 10% on a trade. And I'd be like, you know what, no, I'm going to make 14%. Allen: If I go to 40, if I let it go to expiration, I'm going to make 14%, I want the 14% I don't want to. I don't want to get out of the trade now. It's only got a week left. You know what's going to happen in a week, a lot could happen in a week. And then that thing would turn around, it would take back all the money that I made, and it would give me a big loss. And those are like oh my god, my stomach. Somebody just punched me in the stomach. Oh my god, I've got to die. Because not only did you give back all that money, but now you have this huge loss you're sitting on and you feel like you're the stupid schmuck in the world. So, you know, just stick to the rules. You'll feel better about yourself. Mark: Yeah, definitely. Definitely. Definitely. That's what I made on a set of rules. Just follow. Allen: Had this helped? Mark: Yeah, I think so. Yeah, it's been good is there's been a few aha moments. And yeah, I just got to stick at it and take into paper trading thing. I think I'd definitely take that on. Have another look at that and try and treat it differently as opposed to just artists fake money. So to practice again, doesn't matter. The wife thing I might have to get her involved and as much as she doesn't really want to be involved in training. She's not interested in one or the other. But I'll have to probably get her into look over my shoulder and as you say, Make me accountable, more accountable. I suppose. I've got no trouble Follow the strategy. I've got no trouble following above averages and looking at the deltas and stuff like that. I think it's more the discipline thing is probably.. probably the key thing and taking that 25% loss rather than thinking like that, we'll come back, we'll come back, like now at the moment, look at the market, we're in the moment. It's not easy, peasy, no, it's gonna bounce, we're gonna bounce, we're going to bounce, but it's just keeps going down doesn't, we're in a bear market. Allen: You have to trade the market that you have, not the one that you want. So that's where that's where your your setup will keep you out of trouble. You know, so you want to like I said, you want to have the odds in your favor, as many as possible. So if you have all the indicators, or whatever your whatever your checklist is, you know, you got to make sure that they you check them all off. Otherwise don't do the trade. Mark: Yes, just want to get back to the COVID times when the market is frustrated off again. Allen: I don't think those days are coming back for a long time. This is the new normal, you know, where the Fed is the most important part, the Fed is.. Mark: I know inflation over there is raising interest rates is obviously a big thing in the States at the moment. But over here, we're having similar things happen as well. inflation's like interest rates, rock bottom for a long time. But now we're starting to move back up again. And it's really shaking things up. And people, I think, probably a lot of overextended over a period of time, because everything was so cheap. And now everything's starting to go back up again. everyone's freaking out. And it's obviously shaking the markets up this bear market downturn? Allen: Yep. Yep. I mean, it was, you know, we could see it coming. You know, we could, you could predict it be like, hey, when they start raising rates, stocks are gonna stop going up. They have to go down. So like, I've been predicting it, like, Yeah, we're gonna have a bear market, when they announced, hey, we're thinking of raising rates in the US, you know, when the US Fed announces that, we're thinking of raising rates, that's going to be the top, that day is going to be the top and then it's just gonna go down. And that's exactly what we've seen. So, you know, there are still there are some things that we're looking at, like, Okay, if we see this, and if we see this, we might be putting in a bottom, but I don't think we're there yet. And this volatility is something that we're gonna have to get used to the ups and downs. So, you know, that means when you have a trading plan, and it's been working, but then it stops working, because the market changes, then you as a trader, you have to trade with, you have to change with it. So you have to either trade a different plan, or get a different strategy. So, you know, like, like I said, in the financial crisis, I knew a lot of guys, and I was one of them, that was just doing iron condors all the time, every month, iron condor, easy, easy, 10% every month, but then the market changed, and the condors didn't work anymore. And there were people that didn't adjust, and they didn't change themselves. And they lost whatever money they had, they had to go back to work. You know, they just couldn't make that change and shift. So now we're in a more volatile market. So having resources on your side, you know, having a community having a coach or other people that are trading working with you, it's more important now than ever before. You know, Mark: Now, I think it's been very worthwhile today is reading that was fantastic. It's sort of revisit, there's so many things that have resonated in there with that. It's listen to podcasts, and people's success stories has been fantastic. And what you said today, certainly put a lot of thought in my head, where I definitely need to revisit a lot of those points that you've made today. I know I can do it. I know I can do it. I just just got to break through that ceiling. And I suppose I'm still going to do that. Allen: Yeah, I mean, by talking to you, I know I can tell you know, you have the desire you have everything you need, is there just there's just something there's just one or two little tweaks that we got to make up here. Once that clicks, then then it's gonna start working. That's all that's all it is. And.. Mark: I suppose to claim is definitely one of those things, the wife and the perpetrator. There are three things I've probably taken out of today's discussion. Allen: Yeah, and if you do the right thing, you know, she doesn't know she doesn't have to know how to trade. She just has to be able to ask you the questions. Like, Hey, let's go through every single trade. What's going on in the trade? And what are you going to do if it goes bad? You know, and when. And if you haven't done it, why, why didn't you change it? Mark: Follow the 25% loss Allen: Yeah, if that's if that's the thing, then die she comes in, and she's like, Okay, what's the trade? Apple? Okay? When are you gonna get out? When I'm down 25% Okay, where are you right now? I'm down. 27% Why are you still in the trade? Okay, I'm getting out right now. And then that's it, that will keep you at your losses to around 25%. And so if your gains are 10, and your losses are 25, you should you shouldn't be profitable. You know, the numbers just worked out. Allen: Again, markets a little bit crazy right now. But once things, once thing settled down. It's gonna, you know, everything's gonna clip again. So even now, like we had, in you mentioned, the passive trading formula course, you know, we had a, we had one of our students on this week on the last call, and he said, Yeah, you know, I did nine credit spreads this month. And they all won. You know, even in this craziness, he had nine trades, they all won. So, you know, there's still people doing it, it's still working. So give me give me give me give me like to take like two things, you're going to do two steps, like two activities or two takeaways that you get that you're going to implement? Mark: I think I'm gonna revisit the pilot training, I'm definitely gonna look at that and try and utilize that more. Okay, sure. And I keep thinking the wife, I've got to bring the wife in, but I don't want to do that. That's, that's gonna be hard. Allen: Why is it gonna be hard? Mark: Well, anyway, she's not interested for a start. But if she.. Allen: Is she interested in the money? Yes? That's it. She doesn't have to care what you're doing. You just have to ask you questions. You know, and it's just, you know, like, for as a man, as a husband, you want her to be happy and you don't want her mad at you. And that's the that's the emotion. Right? So if it's if it's the wow factor. Exactly. Yeah, exactly. It's the will factor. Oh, damn well. Okay. All right. So I hope this has helped you. I want you to stay in touch. Keep me apprised of what's going on? And if there's anything we can do, please let me know. Mark: I'm definitely going to be in a much better place. Next time we talk. JOIN OUR FREE PRIVATE FACEBOOK GROUP: https://optiongenius.com/alliance Like our show? Please leave us a review here - even one sentence helps. Thank you!