Top Reasons Why You Should Learn
90% Probability Index Iron Condor and Credit Spread Options First
Before Putting Time Into Any Other Strategy
1)
Ninety % Probability Index
Iron Condor Options are popular because the are easy to
learn, understand, and visualize without the need for complicated and
expensive options
analysis software. For more on what these trades look like, please go
to Iron
Condor and
Credit
Spread.
2) Ninety % probability Index iron condors & credit
spreads are popular with professional traders and hedge funds because they produce
an excellent return of 6% to 10% per month, or 45% to 65%
return per year. The Monthly Cash Thru Options advisory newsletter achieved a
33% return in 2008, 63% in 2007, 42% in 2006, and a 50% return in 2005.
For more details on our returns please visit the
ROI Track Record page.
3) Getting on the "other side" of the trade and selling
(writing) index credit spreads &
iron condors to options speculators & amateurs can truly change your life financially.
It's one of the few investment strategies
available today where you can truly quit your day job after building up a few years of experience. As you probably have
heard, 80% of option traders who buy calls and puts speculatively lose the
premium that they paid to purchase the options; i.e. the options
expired worthless. In contrast, by getting on the other side of the trade and selling
these calls and puts to the speculators & amateurs, like the "house" in a casino,
80% of
our trades are profitable. And we actually take a more conservative
approach where close to 90% of our trades are profitable. This is why the
strategy around selling options can generate a consistent 6% to 10% return
monthly and truly change your life financially.
4) Index Iron Condors & Credit Spreads Options represent a
non-directional, income generating strategy that makes money when the market
trades sideways,
is choppy, or moderately trends upward or downward. Thus, you can make
money in all market conditions. History has shown us that the stock
market usually makes big upward or downward moves of greater than +/- 10% in
45 days or less about once per year, and then the market usually remains
pseudo range-bound, choppy and/or gradually trends upward or downward for
the remaining 10 months of the year. As a result, this strategy is
profitable the majority of the year requiring very little effort.
5) Ninety % probability iron condors have fewer losing
months/year, about 2 to 3, as compared to 70% probability trades. During the 2 to 3
"difficult months" of the
year when the markets move quickly and where we'll most likely have a losing month, because we trade the more
conservative
90% probability trades, we have a good track record of
typically keeping our losses below 10%.
6) You'll sleep better at night knowing that your
iron
condor has a very wide "safe zone". When the markets get volatile,
90% probability iron
condors give us more time to react and make adjustments if necessary.
7) The Index Iron Condor & Credit Spread Strategy only
takes a few hours each week as compared to other trading systems that take
significantly more time and effort. The "traditional" option strategy
speculatively buys directional calls, puts and/or debit spreads on
individual stocks and bets that the stock or index moves in the correct
direction. A big negative for purely focusing on directional option
trades is that they take a lot more time & effort in identifying the trades,
placing the trades and the stop losses, managing the stops and then exiting
the trades; also about 50% of the time directional trades go the wrong way and
stop-out, thus requiring the trader to handle the stress of taking a loss
and needing to continually replenish the trades. In contrast, the
non-directional strategy of being on the "other side" of the trade by selling calls and puts to the
speculators & amateurs takes less effort and only requires a few hours per week.
8) You'll pay less taxes on your gains. Why?
Because we place at least half of our trades on broad-based indexes such as the RUT (Russell 2000 Small-Cap Index) and MID (S&P 400 Mid-Cap Index) which are taxed per the 60/40 tax rule. Section 1256(a)(3) in the
IRS tax code states that gains from option trades on broad-based, cash settled
indexes can take advantage of the 60/40 rule which states that 60% of gains are
taxed as long term capital gains and 40% of gains are taxed as short-term
capital gains, i.e. ordinary income. Overall, the 60/40 tax
treatment is very generous and gives option traders who trade cash settled,
broad-based indexes a tax advantage and the opportunity to make higher returns
than option traders who focus on other financial instruments such as stocks or ETFs.
We also trade a few ETFs such as the SPY that tracks at 1/10th of the S&P500 index, and the
gains on ETF options are taxed at one's ordinary income level.
Please make sure to talk to a tax professional on
this topic as we're not licensed tax professionals and we are not authorized to
give tax advice.
9) For investors with at least 2 years of experience in
trading 90% probability index iron condors & credit spreads, they have the
option to allocate up to 75% of their portfolio, holding 25% in cash, into
just a few monthly trades. As a result, the investor doesn't need to
trade any other stock or options strategies if they don't desire or don't
have the time.
If working less than 2 hours per week, sleeping well at
night, while generating 45% to 65% return annually (33% ROI in 2008, 63% in 2007, 42% in 2006 and
50% in 2005) and learning to become a competent iron condor trader sounds interesting to you, please
sign-up for a
FREE 30 day trial. (no credit card is required) Once you try our
service and if you decide you like this strategy, you can continue for $85/month,
and you may cancel your subscription at any time.
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