How this Bearish Strategy Beat the Index by 288%… Even in a Bull Market

smbcapitalSMB Options


Please note: Trades discussed below are hypothetical and simulated for educational purposes only. Review the options risk disclosure. The graph below compares the Bearish Butterfly vs. the S&P 500 index. If you had traded the rule-based Bearish Butterfly Strategy for the past 5 years, you could have outperformed the index by 288% — even though the market was bullish during … Read More

One Mistake Your Broker is Glad You’re Making

Andrew FaldeSMB Options, Trading Ideas, Trading LessonLeave a Comment

A common mistake that new and developing traders make in the options market is to trade strategies that involve high commissions relative to the earning potential. We often see newer options traders applying great options strategies to the wrong instruments. Option trading strategies that involve frequent management to control risk can be commission intensive. This is especially true if you’re … Read More

3 Reasons to Pairs Trade with Options

Andrew FaldeSMB OptionsLeave a Comment

Pairs trading is a market neutral strategy that focuses on the correlation of two instruments rather than pure direction. For example, you may want to be long $GOOGL and use a short $QQQ position to offset your systemic risk. Or you may see the relative weakness of $IWM and look to trade it long against a short $QQQ position for … Read More

Learn To Trade Before You NEED To

smbcapitalGeneral Comments, John Locke, SMB Video Blogs, Trading Ideas, Trading Lesson, Trading PsychologyLeave a Comment

Whenever market conditions are similar for an extended period of time it’s not that difficult to come up with a trading methodology that works remarkably well. When this happens I’ll see two things. First is a bunch people selling advisories and set ups. And second are traders who think they’ve found the Holy Grail and want to retire. From early … Read More