Optionetics question

Discussion in 'Options' started by Jayzee, May 19, 2009.

  1. Jayzee


    Optionetics users: I recently went to a 2 hour free optionetics seminar, and I have a couple of questions for you:
    1. The presenter claimed that thru optionetics, they only enter a trade if they have 3 in 1 or 300% odds of success. Can someone please verify that? How exactly does this work?
    2. Presenter also claimed that there is ALWAYS a buyer available, and its either some other trader or OCC. Is that right?
  2. Sounds kind of fishy. If they had a secret recipe for making money why would they be teaching people the secret? There is usually a buyer but if the price is right :)

    no one seems to want to buy my covered calls for the price I want to sell.
  3. your answer is, stay away from optionetics. You will find no edge there...
  4. 1) You misunderstood. There are no '300% odds of success.' The maximum probability of winning is 100%.

    They probably said the risk/reward ratio was 3 to 1. That means the maximum profit is 3 times as much as the maximum loss. I don't believe that for one second.

    2) There is always a buyer available, but sometimes the bid is zero. That happens when options are far out of the money or these is very little time before expiration.

    For an option that's trading near $1.00, there is always a buyer available when you want to sell.

    3) Either they lie deliberately or you don't understand what you hear. The OCC does not buy or sell options. The OCC will not make a market for you.

    What the OCC does is act as both buyer and seller for each transaction, guaranteeing that when you make a trade, the other party will not default. The actions of the OCC need not concern you, but if you want to understand more, you can visit optionclearing.com

    4) I can tell from your questions that options are very new to you. Forget Optionetics. They want your money and give you little of value in return. What they offer is available for much less (or free) elsewhere. And it's available without the hype.

  5. sumosam


    a 3:1 risk/reward ratio is a strategy that Optionetics uses...its just that it is not that common that the trade will work out...

    I am not for or against Optionetics. I have taken many of their courses. Depends on what kind of learner you are.

    Market Makers ensure liquidity.
  6. A plain old vertical spread can have a 3:1 reward/risk ratio. But expected return is a very different creature.
  7. MTE


    Stay away from optionetics. All they do is try to sell you their overpriced seminars and software.
  8. Jayzee


    Thank you everyone for your replies. As you can tell, I am a newbie, however I am doing a lot of research and I am also reading the posts on this forum to learn.