This is certainly my experience. I would add that commish and slippage really eat up the juice, at least for retail. Mav, what do you consider a realistic credit for something like a vertical? And how much would you give back before ditching it?
No, i have no first hand experience with dan's mentoring or have anything against the guy for that matter. Having said that, here is the point i am trying to make. Almost all will fail at options on a consistent basis, which is a painful fact known to all of us. Dan's option mentoring will make no to very little difference. You are not going to pick up any edge nor will you learn how to develop a +expectancy style, all you will learn is ops theory and that is it. What's even worse is that you may actually pick up a few bad habits along the way. Like let's say for example, "selling 5 delta spreads with a stop at 10 deltas" and calling it an income generating strat. When all is said and done there will always be guys who dont care about the 5k but whether you do or not, going in with the attitude that you will pick up any meaningful edge beyond what can be learned from the few option bibles out there is a recipe for disaster down the road.
Rally I don't disagree per se about the idea that any of these courses will develop a +'ve exp for participants, but your implication seems to be that developing bad trading habits is the exclusive domain of these services. I just don't think that is a logical line of thinking. Anybody learning to trade via any method can pick up bad habits. So, let's agree that the best one can hope for from such programs as are being discussed here, is a crash course in option theory & that this is actually necessary (though certainly not the only thing) if one has ANY hope of ever pursuing options trading successfully, then what is the problem. Personally speaking I have taken a number of seminars on trading from various sources. I have never ever believed the insinuation or even the outright claim that some of these providers make about what it is they are offering. I only ever viewed them as a quick way to get myself across the very steep theoretical learning curve. As it is I read my first options book & took my first seminar just on 5 years ago. Trading has provided my primary income for 3 years. Had I tried to do so with my head stuck in a book at the library, I swear on my grannys grave, I would still be there trying to figure out Mc Millan, let alone have read most of Cottle's stuff or have a single real cent in the markets. I think you are making assumptions about the attitude that many people go into mentoring programs or seminars with & I certainly have not set myself up in a recipe for disaster I can assure you. Not everyone can get their options education on the floor of the CBOE, or one-on-one from someone who did, though I can say that in the 5 years I have pursued this style of education, the latter is becoming far more accessible. I wonder what else you suggest retail traders do to get up to speed, who perhaps don't have the years of stabbing around in the dark to waste trying to figure all this out on their own? Flame away boys!
Hi AAH I couldn't agree more. It's always easy to criticise those who are trying to make an effort at improving themselves. Yes, many seminars exaggerate the good aspects but to claim that they are all a waste of time or teach one bad habits is just silly. Those sorts of claims generally come from those who are bitter at having spent too much time trying to reinvent the options wheel and wish they had taken a slightly different course. It will be interesting to see which course of action rallymode would recommend to someone who wants to become proficient at options trading. db
There are a lot of ways to learn to trade options. For sure, one needs to first obtain a theoretical background and that is best done reading several good books. Assuming the prospective trader has the talent and the intellect to understand options, the next important issue is practical skills. For that one probably has to find an experienced trader, earning a living off the floor. It is for that reason that I like Dan Sheridan. Even though I hesitate to recommend spending that kind of money, for options it may be necessary IF you want to get a running start at this business. What I like about Dan's program is the emphasis on risk management. In my opinion, if you touch all the bases, and you stay afloat financially, at some point you will have obtained enough experience to make a go of it. Steve
I disagree about the theory coming best from a book. I read, re-read and re-read Cottle CSW & it wasn't until I was able to be part of educational trading session (role playing) by some MM's that the penny really dropped for me about what all the theory meant for my trading. After that Cottle made a whole lot more sense to me (as much as he possibly can with that writing style - LOL!) & I could pick up stuff that was flying over my head before that. Most every trading seminar I have been to (esp now that I have a level of judgement that helps sort the wheat from the chaff) has focussed on risk management as the lynch-pin to being successful - I don't think Dan is unique in this respect, though I do like what I have seen of his stuff a lot. I don't think I am so different from lots of people in saying that I learn better in a more kinesthetic situation - I think it is part of why seminars are very popular. I definitely do not hesitate to recommend that people spend that kind of money on educating themselves. It has never hurt me & I intend to keep investing in my education (in all sorts of areas, through all sorts of means) until the day I die. The payoffs aren't only monetary I find.
I am saying that I have heard a student indicate that his method was working for him. Who cares if the coach is profitable if the students are making money.
Mav. I have experienced that many times with all my body cells. I used to get huge profits by selling naked calls and Puts and when it went againts me, I repaired it by shooting to the next month the position that has gone against me. It worked a couple of times but the ones that did not work, ate all my profit.