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You read that right. $18,000 to $138,000 in profits from Options Trading in twenty trading sessions. How? Options and size.
This student is quickly making the rounds on the internet as he just posted his screenshots and story on the popular Wall Street Bets Reddit forum. This forum is a hot bed for millennials and very, let's say, sketchy trading strategies.
The Wall Street Bets Reddit came to light a while back when a user posted a gain of $900 to $55,000 in ten or so trading days. He was invited to speak at a Ted Talks about this but the real inside joke was that the account statement was doctored and proved to be a fake. You can search that there now and at a simple glance the numbers do not add up so you have to question the journalist who wrote about it and the Ted Talks speech.
To me what this proves is again the detriment of news. People rely on news, articles etc. written by journalists who either A) Don't care or B) Report poorly with the wrong facts. This is the same for financial education: People have discussed, taught and relied on strategies that are just plain false or driven by another motive.
Many new to markets simply lack the fundamental understandings of how the products they are trading actually work, in fact, this idea, is rampant in the Wall Street Bets forum. The traders there refer to it as 'Yolo Trading' - You Only Live Once, essentially, reckless betting. In fact, the markets are not at all that when you learn to do this properly.
I will caution you before reading the forum: The comments are NSFW, many of them, so beware. Read the post here.
Some quick bullet points to answer you questions:
1. He used a combo of OTM and ATM strikes.
2. Minimum 2 Week Expiration, 30 DTE average.
3. Yes, he risked more than 20% of his account on certain trades.
4. Yes, he traded 300 lot size SPY position twice.
5. He is new to options, started in April.
6. He took Core Foundations, Remora Options & Advanced Options, twice.
Style of Trading:
1. Directional Only - Buying calls or puts, no selling.
2. Technical Analysis
3. Momentum & ETF Products
The risk he used is not for everyone but he understood it and took it on, something I can respect. Too many times people get stuck with this idea that 1% per trade is going to make you wealthy, it won't unless you're trading with $10,000,000 already. The quick way to profits is risking it, but in reason and with trading the proper products.
We discuss a way grow an account with Options in this video here.
Enjoy the read.
Disclaimer: This was a Landshark Student, not an instructor or employee of Landshark.