Q: What are your credentials?
A: I’ve been trading equities since 1998 and actively trading options since 2003. I’m a registered investment advisor representative in the state of California and previously managed a hedge fund. Every one of my trades are done with my own money, using TD Ameritrade’s ThinkorSwim Platform. My results are fully auditable and verifiable.
Q: Why not just simply buy a call or a put?
A: Basically, it comes down to odds of success. With an at-the-money (ATM) or out-of-the-money (OTM) options trade, the option buyer has to not only be right about what direction the underlying will move, but right about how far it will move in a finite period of time. This is very difficult to do and is statistically a losing proposition over the long run. For example, at the time of this writing, if you were to buy just a 5% OTM call option on AAPL with 30 days to expiration, you'd need the stock to rise 6.5% by expiration just to break even on the trade. Statistically, for AAPL to rise 6.5% in 30 days, there's only a 26% probability that AAPL will be trading 6.5% higher than it is now. So there you have it, the option buyer has a 26% chance of success (and that's just breaking even) and the seller has a 74% chance that AAPL won't be trading higher than the option strike by expiration. Which odds would you prefer... 26% or 74%?
Q: Are you selling naked options? Isn't that risky?
A: For the most part, NO, we're not selling naked options. And, yes, selling naked options can theoretically subject you to unlimited risk. To limit risk, we're combining long and short calls and puts in vertical or diagonal spreads to make up our trades, such as iron condors or calendars. Once in a while, however, we will sell a naked put at a strike price that we think is a great place to own the stock.
Q: I've never traded options, can I use your service?
A: Yes. I provide all of the details to execute each trade entry, adjustment / management, and exit. HOWEVER, if you have never traded options before, I HIGHLY RECOMMEND first "paper trading" each trade until you fully comprehend the inherent risks involved with trading options in the stock market.
Q: How can I learn about trading options?
A: There are some good options education programs out there. Some notables are Online Trading Academy and Compound Stock Earnings. Only problem is... they'll each cost you hundreds, even thousands of dollars for a weekend course. Then, they'll try to up-sell you to their week long courses which are tens of thousands of dollars each. With Positive Theta, you’ll get specifically tailored trades, configured to reduce risk and greatly improve the probability of a profitable trade. My over 17 years of options trading experience allow you to immediately benefit from my knowledge and understanding of options, which can and do cause tremendous losses to novice options traders. So, sign up for a membership and trade along with us. You’ll learn more and more with each trade you participate in, whether it be with your live account or a paper trading account.
Q: Do you provide stops for each position? Is there a general rule for a 10% trailing stop or do you not want to be stopped out and leave the stop decision to the subscriber?
A: Yes, we generally provide suggested stop levels for either closing out (or) adjusting the position. Additionally, prior to entering, adjusting, or closing any trade, we notify you first.
Q: Do you offer Auto Trading?
A: Not at the moment. Some brokers used to offer auto-trading for newsletter subscribers but I'm not aware of any currently doing it.
Q: How much is a subscription to Positive Theta?
A: For $59 per month, you'll be trading along with a professional trader and registered Investment Advisor . With many competitors charging $200, $300, and even $400 per month, why charge so little??? I want to make the Positive Theta service affordable for all investors, not just high net worth individuals.
Q: Do you offer a free trial?
A: Almost. There's a 1 week trial for $0.01, which auto-converts to a $59 per month subscription, unless you cancel before the end of the initial week. I suggest trying it out for at least a full month. $59 is a pretty inexpensive way to learn some new trading techniques and gain exposure to low risk trades, generating consistent monthly returns.