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There are hundreds of get-rich-quick schemes out there that promise to "make you one million dollars in 24 hours" or invite you to unlock a "$26 billion safe box…"
But the secret to a lifetime of wealth isn't a billionaire's safe box…
And that's the reason I started Power Profit Trades.
My only goal is to arm you with the knowledge and tools you need to make money quickly and safely.
We've been talking about a lot of different techniques you can use – such as trading options on stocks that only require small price movements, buying LEAPS, and trading around earnings.
But you've had some questions along the way – like using Bollinger Bands over Keltner Channels – and it's important to our goal that your questions get answered.
So that's what I'm going to do right now.
Here are the answers to your top 10 investing questions – the first one will blow your mind…
You've Got Questions, I've Got Answers
So, let's get started…
10. I'm new to options… what advice do you have for beginners on placing trades?
The most important thing you can do as a new options trader is digest as much information as you can before trading options.
Here are three other tips:
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- Never use a market order to enter your trade – use a limit order so that you won't overpay for your trade.
- Never chase the market. There are hundreds of stocks out there, so don't waste your time trying to chase after the "perfect stock" – let the market come to you.
- Always put an exit in place.
9. How can a trader capture profit from implied volatility rushing out of the premium without subjecting oneself to unlimited risk?
A lot of people who've ever sold options before understand that there's risk there. What I suggest is an out-of-the-money (OTM) credit spread. This is when you would, for example, sell OTM puts while also buying an equal number of puts. You may have less reward with this strategy, but you'll minimize your risk.
8. Do you find that Bollinger Bands are more useful than Keltner Channels? Or are there specific situations in which one approach works better than the other?
Why not use them together? While there are some situations where one may work better than the other, using both of these makes a powerful combination. Keith Fitz-Gerald, editor of Total Wealth, loves using these together.
7. Couple questions about trading around stock splits… 1) What strike price do you buy before, during, or after the split? & 2) How far out into the future do you buy?
About the Author
Tom Gentile is one of the world's foremost authorities on stock, futures and options trading.
With more than 25 years' experience trading stocks, futures, and options, Tom's style of trading systems and strategies are designed to help individual investors propel themselves past 99 percent of the trading crowd.